Colombia pushes development of its fossil fuels

Colombia is committed to developing its oil, natural gas, and coal resources for export to world markets, said Luis Alberto Moreno, the Colombian ambassador to the US, on Wednesday.

Jun 13th, 2001


Sam Fletcher
OGJ Online

HOUSTON, June 13 -- Colombia is committed to developing its oil, natural gas, and coal resources for export to world markets, said Luis Alberto Moreno, the Colombian ambassador to the US, on Wednesday.

Since taking office in 1998, Colombian President Andraes Pastrana has worked to reform government regulation of Colombia's energy and mining sector to encourage more participation by international companies in exploration and development of the country's resources, he said.

As a result, the oil and mining industries now account for half of Colombia's total exports, Moreno said at a luncheon in Houston sponsored by the Houston InterAmerican Chamber of Commerce.

"Oil surpassed coffee as our primary export nearly a decade ago. Last year, coal also surpassed coffee as an export," he said. "Oil accounts for 35% of our total exports, and coal reached as high as 12% last year."

The US is the major market for both the oil and coal exported from Colombia. The country sends 85% of its oil exports to US markets.

"We are the second-largest provider of light, sweet crude to the US and now also the most important provider of low-sulfur coal," said Moreno. "Our low-sulfur coal meets the highest US environmental standards."

Colombia plans to double its coal exports by 2004. By the end of this decade, Colombia will become the third largest coal producer in the world, up from the fifth largest at present, said Moreno.

Moreover, he said, Colombia has some 70 tcf of proven natural gas reserves that it wants to develop for interstate markets in South America. The country has some of the largest untouched energy reserves in South America, with much of its resources in areas where there has been little exploration and development so far, Moreno said.

To encourage development of its oil and gas, the Colombian government has speeded up the licensing process and reduced its take of oil production to 30% from 50% previously. Tax rates now are in a 5%-25% range instead of the fixed rate of 20% earlier, Moreno said.

The result has been increased participation, with 80 companies "from all over the world" now helping Colombia develop its energy resources, he said.

Contact Sam Fletcher at samf@ogjonline.com

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