Today in Oslo, Norway, the Colombian government is beginning peace talks with the Revolutionary Armed Forces of Colombia, the nation's largest rebel guerrilla group, hoping to negotiate an end to the conflict that has gripped the country for 50 years.
Taking advantage of this, and with confident expectations to agree a deal, the government is holding an auction of oil and gas blocks for the first time in two years.
Companies such as Royal Dutch Shell, ExxonMobil, Petroleo Brasileiro, and OGX Petroleo e Gas Participacoes have already qualified to bid on the 115 blocks that are up for grabs. The companies started placing their bids this morning, and the results will be announced throughout the day.
Columbia is looking to raise investment, whilst at the same time hope to find new oil reserves to ensure future oil production. Existing proven reserves stand at just 2.3 billion barrels, which at current production levels is the equivalent of seven years output.
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As Juan David Pineros, an analyst at Interbolsa, stated, "seven years is a relatively small amount for a country that depends a lot on oil." He said that today's auction is "a big step to ensure future reserves."
The 115 blocks up for auction cover about 13.5 million hectares of central mountainous regions, eastern plains, and offshore areas within the Caribbean.
By. James Burgess of Oilprice.com
James Burgess studied Business Management at the University of Nottingham. He has worked in property development, chartered surveying, marketing, law, and accounts. He has also… More