Colombia's Ecopetrol Scores Positive First-Quarter Results

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Written by Amir Richani for Industrial Info Resources (Sugar Land, Texas)--Ecopetrol (NYSE:EC) (Bogota, Columbia) closed the first quarter of 2023 with strong financial results and higher production.

Ecopetrol reported a net income of 5.7 trillion Colombian pesos (US$1.25 billion) in the first quarter, about 14% below the same period last year. The strong earnings resulted from a favorable Brent-peso environment, robust operations across business lines, and a positive operating performance.

On the upstream front, the Colombian company had a total oil and gas production of 719,000 barrels of oil equivalent per day (boe/d) across all its local and international units. This represented an increase of 3.9% compared to the first quarter of last year.

Oil production stood at 548,000 barrels of oil per day (BBL/d), while natural gas output was 172,000 boe/d, 3.5% and 5.3% higher compared to the same quarter last year, respectively.

The stronger oil volumes were the result of better flows from the Rubiales and Cano Sur fields in Colombia. Additionally, the company's Permian subsidiary, which operates in the United States, increased its oil output by 67.3% to 29,000 BBL/d and gas volumes by 136.5% to 23,000 boe/d compared to the same period last year.

Meanwhile, exploration efforts continued in the first quarter of this year, with eight exploratory wells drilled out of the 25 projected for this year.

The company is also betting on exploring Colombian offshore areas in search of new deposits as the South American nation faces depleting hydrocarbon reserves.

Oil exports, for their part, averaged 442,000 BBL/d during the first quarter, about 11.3% more than during the same period last year. This resulted from more cargoes in transit sent to China, India, the U.S. Gulf Coast and Spain.

Meanwhile, on the downstream front, Ecopetrol hit a historical quarterly record of combined throughput of 412,000 BBL/d. Refinery utilization rates between the company's two major refineries averaged 86%, about 30% more year on year.

The higher output resulted from stability in the company's refineries to benefit from market advantages, as well as the maximization of domestic crude consumption.

Finally, Ecopetrol continues to focus on renewable energy through the development of hydrogen and solar projects. On the hydrogen front, the company is developing two electrolysis projects with a total capacity of 120 megawatts (MW) which will be able to produce some 18,000 tons of green hydrogen per year. Additionally, in a partnership with Total Eren (Paris, France), Ecopetrol is building a photovoltaic solar farm of 180,000 panels in the Rubiales field to provide 100 MW of electricity. Subscribers to Industrial Info's Global Market Intelligence (GMI) Power Project Database can click here for the related report.

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