Bidding Rounds 2007-8 in Colombia

From Oil4All
Jump to: navigation, search

In December 2006 the National Hydrocarbons Agency (ANH) announced plans for a series of bidding rounds to begin in 2007, as part of the country's strategy to attract investment and boost oil output.[1]

Caribbean Round 2007

In 2007 Colombia launched its first offshore bidding round, offering 13 blocks off the Caribbean coast. Each block on offer was around 740,000 acres and are located along a stretch running from offshore Guajira to the northern end of the Uraba Gulf, taking in almost the whole of Colombia's Caribbean coastline. The blocks included not only deepwater offerings but shallow blocks both onshore and offshore.[2]

On the 18 September 2007 the bidding took place, resulting in the successful auction of nine exploration blocks. According to a leaked US diplomatic cable, the Colombian government had anticipated receiving bids on no more than seven of the nine blocks.[3] However the blocks were awarded as follows:[4]

Block Operator Other Partners Initial investment ANH profit margin
RC10 ONGC Videsh (50%) Ecopetrol (50%) $5.3 million 2%
RC11 Ecopetrol (100%) $5.3 million 3%
RC4 BP (35%) Ecopetrol (35%); Petrobras (30%) $5.5 million 16%
RC8 ONGC Videsh (40%) Ecopetrol (40%); Petrobras (20%) $5.3 million 4%
RC5 BP (100%) $5.8 million 12%
RC12 Ecopetrol (100%) $5.3 million 15%
RC7 Petrobras (40%) Ecopetrol (30%); Hess (30%) $5.3 million 11%
RC6 Petrobras (40%) Ecopetrol] (30%); Hess (30%) $5.3 million 2%
RC9 Ecopetrol] (50%) ONGC Videsh (50%) $5.3 million 5%

Chevron, one of the first offshore producers in Colombia, did not submit any bids during the round. Companies which were awarded blocks agreed to invest a minimum of $5 million in exploration in each respective block. On completion of the round, Colombia had 6 million hectares of offshore territory under exploration.[3]

Colombia Round 2008

'Colombia Round 2008' comprised of two separate bid rounds.

In the first round held in November 2008, 43 blocks were on offer in four basins: the Cesar-Rancheria Basin in the north-east, the Sinú-San Jacinto Basin in the northwest, the Cordillera Basin in the eastern central region, and the Crudos-Pesados area of the eastern portion of the Llanos Basin in central Colombia.[5]

The second bid round was competed in December 2008. According to a US diplomatic cable from December 2008, Colombian officials characterized the second bloc auction as a success, asserting that many of the blocs received several bids higher than expected. The auction attracted bids on 48 heavy oil mini-blocs in the eastern Cordillera region (provinces of Santander and Norte de Santander), Magdalena province, Putumayo province and the eastern Llanos region (Meta province). Half of the blocs on offer attracted bids, meeting the government's target. The total exploration investment committed to the 48 blocs exceeded US $300 million and brought the total number of contracts ajudicated in 2008 to a record 100 contracts.[6]

References

  1. ANH unveils plans for future bidding rounds - ColombiaBusiness News Americas, 5 December 2006.
  2. Colombia opens offshore tractsE&P, 2 July 2007.
  3. 3.0 3.1 Colombia Auctions Nine Offshore Blocks On Caribbean CoastWikileaks, 19 September 2007.
  4. The ANH successfully closes the Caribbean RoundANH, 19 September 2007.
  5. Colombia is open for businessE&P, 24 June 2008.
  6. Colombia Energy Update: More Blocs, Gas Prospects, And BiofuelsWikileaks, 17 December 2008.