Ecopetrol takes control of pipeline

Mar 16, 2009 01:00 AM

Colombian state oil company Ecopetrol said it would take control of the Ocensa pipeline via an agreement with Canada's Enbridge to acquire that firm's stake in the operation.
The $ 417.8 mm deal will leave Ecopetrol with 60 % of Ocensa, which spans 829 km (515 miles) and is Colombia's longest pipeline. The remaining 40 % of Ocensa is held by oil majors BP and Total, which are also Ecopetrol's partners in the Cusiana and Cupiagua fields, located in Arauca province on the north-eastern border with Venezuela.

Ocensa, which has been operating for nearly 15 years, was built to carry crude from Colombia's Eastern Plains to Covenas, a port that has terminals on the Caribbean. The pipeline, which has been operated by Enbridge, has the capacity to carry up to 650,000 bpd of crude.
"This transaction will strengthen Ecopetrol's position in the most important oil transport system in Colombia," the state-controlled firm said. "As such, the transaction is vital to the growth strategy of the company, which aims to increase Ecopetrol's oil production in the Eastern Plains region of Colombia and promote the development of new business opportunities," the company said.

The pipeline deal was the second infrastructure acquisition made by Ecopetrol in the past days. On March 10, Ecopetrol announced plans to acquire the Colombian assets and working capital of Hocol Petroleum, a subsidiary of French oil company Etablissements Maurel & Prom, for $ 748 mm.
Ecopetrol, the fourth-largest oil company in Latin America, said Hocol produced an average of 15,000 bpd in 2008, with production expected to rise to 22,000 bpd in 2009. Hocol operates fields in eastern and south-western Colombia, owns 36.12 % and 21.72 % stakes in the Alto Magdalena and Colombia pipelines, respectively, and has interests in some exploration blocks.

Earlier this month, Ecopetrol said it reached an agreement to acquire Swiss multinational Glencore's stake in Refineria de Cartagena, or Reficar, for $ 549 mm.
Ecopetrol also said recently that it planned to issue up to $ 8.1 bn in bonds and would ask for authorization to carry out the debt offering at its March 26 shareholders meeting.

Source / EFE
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