Background and Relevance of Ecopetrol
Ecopetrol, Colombia’s state-owned oil company, has been a significant player in the global energy sector. With a production of nearly 755,000 barrels of oil per day (bpd), the company has been striving to maintain its position amidst challenges such as reduced gas availability and fluctuating market conditions. Recently, Ecopetrol has been actively managing several critical situations, including the potential divestment from its non-conventional Permian Basin assets in Texas, USA.
Permian Basin: A Growing and Profitable Asset
The Permian Basin, the only non-conventional field in Ecopetrol’s portfolio, has seen substantial growth since the joint venture agreement with OXY in 2019. Initially producing minimal amounts of gas and crude (1,400 barrels of gas and 3,800 barrels of crude in 2020), the Permian Basin has experienced a steady increase in output. In 2021, daily production reached 5,800 barrels of gas and 13,500 barrels of crude. By 2022, these figures rose to 14,000 barrels of gas and 23,800 barrels of crude. The trend continued into 2023 with daily production reaching 27,800 barrels of gas and 38,600 barrels of crude. As of mid-2025, the Permian Basin is producing 115,000 bpd, with 51,900 barrels of gas and 63,600 barrels of crude.
The Permian Basin also holds a significant portion of Ecopetrol’s total reserves, accounting for 10% (189 million barrels) out of the company’s 1.893 billion barrels reported reserves from the previous year. Moreover, this non-conventional field is one of Ecopetrol’s most profitable ventures, with a lifting cost of $6 per barrel compared to an average of $12 in national fields.
Financial Performance and Strategic Importance
Sergio Cabrales, an energy affairs expert, highlighted the financial and strategic significance of Ecopetrol’s Permian Basin operations. The Ebitda margin for this business stands at 76%, significantly higher than the average of 35-40% in national operations. The Permian Basin accounts for approximately 14% of the upstream segment’s Ebitda, underscoring its strategic importance.
Union Sindical Obrera’s Stance
César Loza, president of the Union Sindical Obrera (USO), a labor union representing Ecopetrol workers, has expressed strong opposition to the potential divestment from the Permian Basin. Loza warned of possible nationwide mobilizations and potential operational disruptions should Ecopetrol proceed with the negotiations.
Productivity Comparison
While the Permian Basin ranks fourth in daily production among Ecopetrol’s fields, it still lags behind historically productive regions like the Orinoquía, which boasts daily production of 192,500 barrels.
Key Questions and Answers
- What is Ecopetrol considering? Ecopetrol is contemplating divesting from its non-conventional Permian Basin assets in Texas, USA.
- What percentage of Ecopetrol’s oil business does the Permian Basin represent? The Permian Basin accounts for approximately 15% of Ecopetrol’s oil production.
- Why is the Permian Basin significant for Ecopetrol? The Permian Basin is one of Ecopetrol’s most profitable ventures, with a low lifting cost and substantial reserve holdings. It also contributes significantly to Ecopetrol’s Ebitda margin and strategic upstream segment performance.
- What is the Union Sindical Obrera’s (USO) stance on the potential divestment? USO’s president, César Loza, has expressed strong opposition to the potential divestment and warned of possible mobilizations and operational disruptions.
- How does the Permian Basin’s productivity compare to other Ecopetrol fields? Although the Permian Basin ranks fourth in daily production, it still lags behind historically productive regions like the Orinoquía.
