With the tax reform approved, the oil industry faces the consequences of the greater fiscal pressure, as well as messages related to the need to reduce the operation, on behalf of the energy transition.
(‘Protect the investment’: petition of the ex-Minhacienda to the Petro government).
During the reform discussions, sectoral voices warned that one of the effects of this greater pressure would be a drop in investment levels. Precisely, now the companies are analyzing the resources that they will mobilize next year. Such is the case of Frontera Energy, Hocol, Gran Tierra or Canacol, which are currently evaluating the resources they will allocate in 2023.
This was reflected in the results of the Oil Barometer presented by Jaime Arteaga y Asociados, which showed that 37% of the companies would reduce their operations in the next 5 years. However, the businessmen said they have a long-term commitment to the country, so they will continue.
Although the companies are analyzing their investment portfolios and there is still no clarity regarding the level of resources that will be allocated to their activities for the next year, the truth is that some are considering the possibility of reducing them. The companies indicated that for the moment they are analyzing, but there is a scenario of uncertainty.
(There are already oil companies stopping their investments in the country).
Orlando Cabrales, CEO of Frontera Energy, stated that they are currently working on what will be their plan for the next year. “We are obviously incorporating the impact of the tax reform, but we have not announced anything,” assured and added that “We hope to have ready that readjustment of the investments that we are still analyzing in a month.”
This is also the case of Hocol, part of the Ecopetrol Group. According to Rafael Guzmán, president of the company, factors such as the rent surcharge and the non-deductibility of royalties are already being taken into account in the analysis.
“We are at the moment of understanding the tax reform and calculating what the impacts are. Obviously the investment depends on the cash available”Guzman said.
Precisely, Francisco José Lloreda, president of the Colombian Association of Oil and Gas (ACP), said that the environment of uncertainty coupled with the effects of the reform will lead to a contraction of investment next year.
However, the presidents were emphatic that they remain committed to investing in the country. “We are committed to continue investing in Colombia in the 23 contracts we have”pointed out Manuel Buitrago, president of Gran Tierra Energy.
In fact, on this point, Guzmán was also emphatic and stressed that they will continue with their explorations. The leader stressed that they have an ambitious drilling plan that they hope to continue.
At this moment the companies are in the process of making and presenting their investment plans, as is the case of Frontera, Hocol, Canacol or Parex.
(For Campetrol, if we lose confidence, the investments will go away).
According to Lloreda, the plans will be fully disclosed in the coming weeks. This year the investment in exploration and production was US$4,000 million, according to the ACP. This data is greater than that of previous years; however, the following year they could be affected by the tax reform. “It will depend on the signals that the Government gives in the coming months”Lloreda concluded.
Gas reserves could double
Ecopetrol announced that gas discoveries in one of the offshore blocks have the potential to double reserves. With a cut to 2021, the country had 3.8 cubic terapiés of gas (representing 8 years) and in the two wells found, there could be between 3.4 and 5.5 terapiés of gas. Regarding the discovery in the KGG block explored together with Shell, Felipe Bayón, president of the state oil company, stated that they are verifying the magnitude of the reserves. Likewise, in 2024 they will drill in blocks COL – 1, 2, 6 and 7 together with Occidental Petroleum (Oxy).
Daniela Morales Soler
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