Food exports must triple to match oil

Food exports must triple to match oil

After the Minister of Mines and Energy, Irene Vélez, reiterated her participation in the World Economic Forum in Davos (Switzerland) that no new contracts for the exploration and production of oil and gasa series of reactions were generated that question the decision of the Government.

(See: Director of Public Credit says that oil revenues are needed).

According to the Ministerthe objective of the presidency of Gustavo Petro it is betting on agribusiness as well as tourism to replace oil revenues.

In fact, after his final intervention in DavosPresident Petro told journalists that “We are convinced that a strong investment in tourism and in the capacity and potential of the country in clean energy generation could, in the short term, make a transition, fill the gaps that the fossil economy on which we have depended can leave”, according to ‘EFE’.

(See: ‘Gas reserves reach for a period between 2037 and 2042’: Petro).

The announcement came after this sector provided a historic figure of tax revenue, since the Colombian Association of Oil and Gas (PCA) estimated that by 2022, for taxes and royalties the Nation would receive $58 billion, more than twice the amount sought with the tax reform, as explained by Francisco José Lloreda, president of the union.

Now, although the Government has indicated that its objective is in the “short term” to replace oil and the coal of the economyAt the moment, there are no known specific actions that lead to achieving this objective.

According to the most recent report of the National Administrative Department of Statistics (Dane), as of November the weight of the extractive industries (hydrocarbons, mines and quarries) represented 56.3% of the exports of the country.

For its part, despite its growth of 24.8% so far this year, the weight of agricultural, foods and beverages was 20.2% of the exports of the country.

(See: The positions found after Minenergía’s announcement continue).

That is, these two sectors would have to be almost three times larger just to represent the same worth that represents the sector extractive.

“Diversifying the export basket should be an objective, but not at the cost of withering the industry. And, the development of other sectors, such as tourism, has enormous potential, but it will take time.”affirmed the ACP.

(See: ‘Government has not really said how it will replace oil revenues’).

Not only that, the sector also has an important weight in the income of currency to the country. This is reflected in the foreign direct investment.

According to the data of the Bank of the Republicin 2022, the capitals that arrived to the nation had a increase of 57.7% and the figure totaled US$11,304 million. Of this amount, 72% was represented by mining and energy.

Following the announcement, the director of Public Credit, José Roberto Acosta, published in his account Twitter that Colombia “it still needs oil dividends, royalties and taxes.”

He pointed out that the energy transition plan will take about 20 years to complete. For this, the PCA pointed out that the country has proven reserves for less than 10 years and that the contracts that are signed in Currently they are not able to guarantee security and energy self-sufficiency.

Although the minister Velez has indicated that the proven, probable and possible reserves, as well as the contingent and prospective transition could be madevoices in the sector have pointed out that making accounts with these resources is risky.

“Prospective resources are those quantities of hydrocarbons that, on a given date, have not yet been discovered but have been inferred and are estimated to be potentially recoverable.” explained Flover Rodríguez, president of the Colombian Association of geologists and geophysicists of Petroleum.

Therefore, he asserted that “it is key to be very precise when mentioning numbers in order to ensure comparability”.

the portfolio of Energy presented a “balance of hydrocarbon contracts and resources available for the Just Energy Transition” although this does not specify the conclusion regarding whether or not a new contract is necessary.

government reserve accounts

“If proven, probable and possible reserves are added and development of discoveries is added, the supply would be guaranteed until beyond the year 2037. If the prospective resources are added, it would be ensured until the year 2042”, said the Minister of Mines and Energy, Irene Velez.

Nevertheless, only proven reserves are considered (7.6 years), since the others require certain conditions to surface.

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