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Drop in Colombia oil output

Drop in Colombia oil output

Posted by Jesus Mendoza on January 21, 2015

A decline in oil production in Colombia will be "inevitable" in 2016, when output could fall to roughly 900,000 barrels per day due to a steep drop in international oil prices and scaled-back investment, the ACP oil producers' association said.

"Starting in 2016, a steady slowdown in the country's crude production is expected. By 2018, this could end up meaning a reduction of 220,000 barrels per day," ACP President Francisco Lloreda said at a press conference Tuesday.

In December, average crude output in Colombia amounted to 1,007,400 barrels per day, an increase of 0.5 percent, or 5,400 bpd, from November, the Mines and Energy Ministry said.

The ACP, which comprises nearly 80 oil-sector companies, estimates that every one-dollar drop in international oil prices translates into a 300-billion-peso ($123-million) decline in funds entering the country.

"If the price of crude stays at $50 a barrel, that would mean a 15-trillion-peso ($6.2-billion) decline in revenue for Colombia," where crude oil accounts for more than 50 percent of the country's exports, Lloreda said.

The ACP is forecasting that oil output will come in at an average of 1,020,000 barrels per day this year but then fall to roughly 900,000 bpd in 2016.

Lloreda also noted that half of the companies in Colombia's oil sector have announced plans to scale back their exploration plans.

"To the extent you explore less, unfortunately this is going to adversely affect the incorporation of oil reserves, which is essential for the country," the ACP chief said.

The association expects seismic exploration this year in Colombia to cover an area of 14,000 sq. kilometers (5,400 sq. miles), down significantly from 32,000 sq. kilometers in 2014.

It added, however, that 126 exploratory wells are expected to be drilled in 2015, up from 113 last year. EFE

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