The Colombian hydrocarbons sector Armando Zamora Director General National Hydrocarbons Agency

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The Colombian hydrocarbons sector Armando
Zamora Director GeneralNational Hydrocarbons
Agency
Colombia Oil Gas Investment Conference
Cartagena, 20 May 2005
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It all started 100 years ago
1905 De Mares and Barco concessions 1918
First discoveries La Cira and Infantas
(Tropical Oil Co.) 1951 Reversion of De Mares
Concession Ecopetrol is established 1953
Petroleum code 1974 Crude imports
Chuchupa Ballena discovery (TPC)
Association contract
Agencia Nacional de Hidrocarburos
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The 80s witnessed the highest activity
A-3 Wells
WTI Oil price (US/bl)
Cusiana
Opening of new areas worldwide
Caño Limón
1996
1990
1992
1994
1998
2000
2002
1978
1976
1972
1984
1980
1982
1986
1988
1974
1997
1999
1993
1995
2001
1977
1975
1991
1979
1981
1985
1983
1987
1989
1973
Variable Royalties
Sliding-scale participation
R Factor
Association Contract International Prices
War taxes and remittances
70/30 Participation
Crude imports
Source ACP, DOE
Agencia Nacional de Hidrocarburos
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The new royalty scheme (2002) is competitive
Royalties
of production (per field)
25
20
8
10
0
5
125
400
0
5
125
600
400
Production level (000boe / day)
Agencia Nacional de Hidrocarburos
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Active areas are located in a few basins
Agencia Nacional de Hidrocarburos
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The new contractual scheme is attractive

• EP Contract
• Taxes Royalties
• Flexible Periods
• Automatic extension possible
• Materiality autonomy

• Award process
• First come, first served
• Prompt and transparent
• Pre-set negotiation periods

Agencia Nacional de Hidrocarburos
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Competitiveness map
100
Venezuela
Indonesia
Not very competitive
90
Norway
Turkmenistan
Angola
Bolivia
Gabon
China
80
Colombia (2003)
Australia
70
Objective
State Take Economic Fields PEPS
Kazakhstan
India
Brazil
Argentina
60
Colombia (now)
Peru
50
Pakistan
Very competitive
United Kingdom
40
0
5
10
15
20
25
30
35
40
45
50
Prospectivity Index
Source PEPS-USGS
8
Contracts signed since June 2004 with
New entrants in bold
9
Number of EP Contracts
39 approved (27 signed)
35
ANH
32
31
30
30
28
25
25
21
20
21
14
11
15
10
5
7
4
0
1999
2000
2001
2002
2003
2004
2005(p)
Ecopetrol
ANH-for signature
ANH-signed
Goal
Planned
Agencia Nacional de Hidrocarburos
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Exploration activity is increasing
Number of A-3 wells
2D-equivalent Kms of seismic
45
14000
40
12000
35
10000
30
8000
25
20
6000
15
4000
10
2000
5
0
0
2000
2001
2002
2003
2004
2005 (P)
Planned
Agencia Nacional de Hidrocarburos
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An unexplored country
Only 13 of total sedimentary area has been
licensed
5 by ANH
8 by Ecopetrol
87 available
Total sedimentary area ? 1 million km2
20 off-shore basins 80 on-shore basins
Non- sedimentary areas
Agencia Nacional de Hidrocarburos
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Geological potential (to 2020)
New discoveries scenarios (to 2020)
106bls
12
10
8
?
6
4
2
Potential
Self-sufficiency
ANH
optimistic IHS
Source IHS, ANH analysis
Agencia Nacional de Hidrocarburos
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Production profiles contingent to potential
scenarios
Geologic potential scenarios
000barrels/day
2.000
1.600
IHS optimistic
1.200
800
ANH
400
Self-sufficiency
Current fields
2005
2015
2010
2020
Sources UPME, Ecopetrol, IHS
Agencia Nacional de Hidrocarburos
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Required activity according to scenarios of
reserves to be discovered up to 2020
150
75
60
40
30
60
20
10
5-6
Self-sufficiency
ANH
Optimistic IHS
A3 Wells
Discoveries (20mmbl)
Contracts
Agencia Nacional de Hidrocarburos
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An aggressive campaign of new information
acquisition is at the core of the ANHs strategy
Promotion
Identification of opportunities
Investor support
Contract Management
Promotion
Negotiation

• ANHs investments in acquisition
• of new geological information
• US70million in 2005
• US800million to 2020

• New information
• Identification of opportunities
• Promote them to investors

Agencia Nacional de Hidrocarburos
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Investment campaign 2005 seismic
SINU SAN JACINTO
CAYOS 2D
VMM
PACIFICO OFFSHORE - ONSHORE
LLANOS
Agencia Nacional de Hidrocarburos
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Investment campaign general studies
SINU- SAN JACINTO SEQUENCE STRATIGRAPHY
EASTERN CORDILLERA SOAPAGA CARTOGRAPHY
VMM HEAVY OIL
LLANOS HEAVY OIL
LLANOS FOOTHILLS CARTOGRAPHY
Agencia Nacional de Hidrocarburos
Agencia Nacional de Hidrocarburos
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The State will be priming the pump

• Plan 2020 to discover gt 4Bn boe
• ANH and Ecopetrol to invest 15Bn in exploration
  and development (to 2020)
• ANH alone to invest around 800m in frontier
  areas (to 2020)
• Activity objective 30 new EP contracts / year
• ANH flag projects
• Heavy oil
• Tayrona
• Pacific basin
• Sinu-San Jacinto
• Tello field

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Thank you! www.anh.gov.co
Agencia Nacional de Hidrocarburos
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ANH heavy oil project Llanos Basin
 
Bidding Round Preparation Early 2006 Planned
Bidding Round Mid 2006