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Felicity Bradstock

Felicity Bradstock

Felicity Bradstock is a freelance writer specialising in Energy and Finance. She has a Master’s in International Development from the University of Birmingham, UK.

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Colombia Has To Choose Between Energy Security And The Environment

  • The fight in Colombia between environmentalists and proponents of energy security is a microcosm of the global conflict between energy and emissions.
  • Colombia’s Petroleum Association warned earlier this week that the country could lose its energy self-sufficiency by 2028 if it fails to boost production soon.
  • Environmentalists and local residents have been fighting hard against fracking operations in Colombia, operations that Ecopetrol believes will boost the country’s oil reserves significantly.
Energy

The fight between energy security backers who want to boost oil operations and environmentalists is intensifying in Colombia. While a Colombian oil and gas industry group says Colombia must boost its crude output to ensure the country’s energy security, activists are fighting to stop fracking. With presidential elections coming up, the future of Colombian energy hangs in the balance. The Colombian Petroleum Association (ACP) warned this week that Colombia may lose its energy self-sufficiency by as early as 2028 if it does not take action to boost oil production soon. Keeping production at its current rate could encourage greater investment in the country and achieve revenues of around $25.9 billion under the next administration, saving Colombia from having to import gas and oil starting in 2026 and 2028 respectively.

ACP president Francisco Lloreda stated, “Colombia has the resources to be self-sufficient in matters concerning (oil and gas).” And “If what's happening in Europe teaches us anything, it's that self-sufficiency is key,” he added. The Russian invasion of Ukraine and the subsequent sanctions on Russian energy have made governments around the world focus more strongly on energy self-sufficiency.

But while oil and gas groups are fighting for the survival of Colombia’s fossil fuel industry, environmentalists are taking to the streets in opposition to fracking. The town of Puerto Wilches in the oil-rich Santander Magdalena Medio region is set to be the site of Colombia’s first fracking development. But many local residents are opposed to the project. However, several activists in the region have been threatened for protesting, deterring others from doing the same.

In 2018, a temporary ban on fracking was put in place in Colombia, with the exception of pilot projects. This suggested that fracking might be permitted in the future. But following widespread local objection to the development of a fracking development, the potential for greater crude oil extraction could be limited.

State-owned oil firm Ecopetrol announced earlier this month that it believes commercial fracking operations have the potential to extend oil and gas production for 12 to 15 years. It expects a suspended environmental license for a fracking pilot project to be reconsidered in June, with the potential of commencing operations in Santander. Ecopetrol sees fracking as a necessary move to ensure Colombia’s energy self-sufficiency in the coming years.

Related: What Thomas Edison Can Teach Us About Our Electricity Crisis

Ecopetrol and partner ExxonMobil have been permitted to continue research for the pilot project, while the administrative court decides whether to allow commercial development of the fracking site. The pause in operations came as a judge ruled that local communities had not been consulted on the development. But, following an appeal, Ecopetrol is confident that it will be permitted to go ahead with the drilling of between 150 and 200 fracking wells. It hopes if operations are approved, each of the wells could produce around 1.1 to 1.2 million barrels of oil equivalent, with operations continuing for 20 to 25 years.

While oil operations are currently facing controversy, Colombia’s gas operations look optimistic. Frontera Energy plans to increase long-term natural gas production in its lower Magdalena valley operations. The energy firm has already increased its output significantly in the last year, with a conventional gas output of 9.53Mf3/d in Q1 2022 compared to 4.66Mf3/d in the same period of 2021. 

Orlando Cabrales, CEO of Canadian firm Frontera Energy, stated, “In the short term, we don't expect any significant change in our gas portfolio or in the production mix. But it's very important to note that we have had a significant increase in the lower Magdalena valley and positive results [from other] acreage in the past.” And “Additional exploration and development activities in the lower Magdalena valley could continue to increase our participation in gas”, he added. 

Frontera expects to invest $225-255 million in its Magdalena gas operations. In addition, the firm has plans to develop a solar plant to produce electricity to support its operations by 2023. 

However, with presidential elections looming, Colombia’s energy outlook could quickly change. Earlier this year, Colombian Senator and presidential front-runner Gustavo Petro called on the rest of Latin America to move away from fossil fuels, demonstrating his stance on the oil and gas industry. But most expect oil and gas to continue contributing to the country’s energy mix under the next government, regardless of who wins. Although, if Petro wins, he is likely to draw up a strategy for the eventual national transition to renewable energy. 

Juan Carlos Arenas, director of political studies at the Universidad de Antioquia in Medellín stated his expectations from the elections, “He has insisted not on putting brakes on the use of oil resources or coal mining, but on a suspension of that business model. Opponents often claim that he says there will be no more oil exploration. That would be stupid. From what I understand, the proposal is more closely related to how this period can be used to design an effective energy transition process.”

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There is no clear understanding of what Colombia’s oil and gas industry will look like in a decade’s time. As the state’s energy company fights to get its fracking project off the ground, to ensure the country’s long-term energy self-sufficiency, residents in the region oppose the development. In addition, if Petro wins the presidential election, Colombia’s energy transition could come sooner than many thought

By Felicity Bradstock for Oilprice.com

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Leave a comment
  • Pedro Jaramillo on May 12 2022 said:
    Good article Felicity, the only thing you are missing is that the energy transition in Colombia is already ongoing, this government has put in place several wind and sun farms to make sure we move from coal and oil and gas, but we need to be ready to keep the production of O&G and mining products because the economy needs this resources not only to the government but also to make sure the energy transition keeps ongoing

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