Colombia To Grant Rights To Seek Oil, Gas In 78 Areas

Date : 09/10/2010 @ 3:33PM
Source : Dow Jones News
Stock : Gran Tierra Energy Inc. (GTE)
Quote : 2.83  0.04 (1.43%) @ 8:00PM

Colombia To Grant Rights To Seek Oil, Gas In 78 Areas

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The Colombian government revised the results of a June auction of rights to seek oil and gas and reduced the number of areas allocated to oil companies to 78 from 96, the head of the country's oil licensing agency said Friday.

Armando Zamora said several companies that had filed the best offers for some areas were too small to get more than one area, while other areas granted were canceled on other technicalities.

During the revision, state-controlled oil company Ecopetrol SA (ECOPETROL.BO) was granted one more field than the 14 it had won in June.

The companies that filed the highest bids for the areas included Royal Dutch Shell PLC (RDSA), France's Etablissements Maurel & Prom SA (MAU.FR), Canada-listed Gran Tierra Energy Inc. (GTE, GTE.T) and South Korea's SK Energy (096770.SE), which teamed up with Pacific Rubiales (PEGFF, PRE.T) and Canacol Energy (CAAEF, CNE.V) in some areas.

Ecopetrol teamed with Spain's Repsol YPF SA (REP, REP.MC) for some areas.

Zamora said the final results of the auction will be released next month and about three areas are still being evaluated.

Foreign direct investment in oil this year will likely reach $5 billion, Zamora said. The amount will be close to the two previous record years of 2007 and 2008.

He said several oil companies in the country are in the process of certifying reserves from new discoveries. "These are small, there is nothing gigantic but together they add up to a significant amount," he said.

Colombia has seen massive inflows of foreign investment to develop its oil and natural-gas industries as a result of the government's market-friendly policies and its success in gaining control of territory once in the hands of Marxist guerrillas.

The country's output is recovering to levels not seen since the end of the 1990s and analysts and government officials expect output to break previous records and reach one million barrels a day within a couple of years.

-By Inti Landauro, Dow Jones Newswires; 57-310 867 65 42;


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