‘Government has not really said how it will replace oil revenues’

In the midst of the World Economic Forum, which takes place in Davos, Switzerland, the Minister of Mines and Energy, Irene Vélez, assured that In Colombia, mining or gas exploitation titles will not continue to be delivered.

(Read: Why new oil exploration contracts won’t be delivered.)

Given the news, which had been announced since the campaign of President Gustavo Petro, the Colombian Association of Oil and Gas He expressed his concern about the announcement.

“The exploration and production of oil and natural gas is essential to guarantee the
country self-sufficiency and energy sovereignty, in the short, medium and long term, while
advances the responsible transition that Colombia requires“, they explain in a statement.

Along with this, ACP assures that the main challenge for the country in the energy transition is not the diversification of the electrical matrix but the energy And that this process is only possible with the transition of the automotive fleet.

They also ensure that “theThe hydrocarbons industry is essential for the economic stability of the country, national financing and that of the departments and municipalities“.

(In addition: Oil and mining sector attracted 72% of FDI to the country).

They further indicate that transition is not a short-term process: “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. This transition will not take place in the short term A triple transition is needed: energy, fiscal and royalties, and productive.”

The union also ensures that the government has not clearly explained how it is going to replace “Realistically” oil and gas knowing that the reserves will only last approximately 10 years and “that the exploration contracts signed do not ensure self-sufficiency or energy sovereignty in the medium and long term.”

“Nor has it explained how it will replace the tax revenues that the industry contributes to the Nation (fundamental in the past tax reform) or royalties. For this reason, in different scenarios, we have called for caution. For a transition to be just, it must be responsible“, they expose.

(Keep reading: ‘Stopping oil exploration is social suicide’: former President Duque).

For the guild the elimination of new contracts nor does it have an impact on the fight for climate change that justifies much of the decision. According to the entity, the exploration and production of oil and gas contributes less than 1% of the Greenhouse Gases in the country.

Finally, he assures: “Ihe national government affirmed last year that it would submit the decision to sign new exploration contracts or not to a study of the country’s hydrocarbon potential, an analysis of the signed exploration and production contracts, and the time that Colombia will need from the industry to its export diversification, and the substitution of fiscal income and royalties. This study does not exist“.

For ACP, the studies used by the Government are “superficial” and have not included a macroeconomic or fiscal component. From the union they state that they will continue to be willing to work on the “construction of a joint vision of the country and its energy, social and environmental opportunities.”

The president of the National Association of Industrialists Andi, Bruce Mac Master, also commented on the decision. Through his Twitter account, he assured that the decision of “Giving up the main source of foreign currency, exports, foreign investment, and resources for public finances, without replacing it, generates unsustainable pressure on the economy, the exchange rate, and inflation“.

Finally, he said that this would have “irreversible” effects.

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