Colombia attacks cut Gran Tierra profits in half
Sliding fortunes: Export disruptions see production and profits fall for Gran Tierra Energy
07 August 2012 11:12 GMT
Canada’s Gran Tierra Energy has seen production in its Colombia-focused portfolio fall 22% compared to this time last year due to pipeline disruption.
The Calgary-based explorer reported quarterly average daily production of 16,306 barrels of oil equivalent net after royalty before inventory adjustments, compared to 18,141 a year earlier.
Delivery restrictions on the Ecopetrol-operated Oleoducto Transandino pipeline, the latest of which lasted from 3-14 July, forced Gran Tierra Energy to produce at a reduced rate, with a portion of its crude sold through trucking and the rest put in storage.
The output dive – first flagged to shareholders in New York and Toronto last month – compares to a target set for the past three months of 20,000 to 21,000 boe daily.
Quarterly net income sank 58.5% to $13.1 million in the second quarter compared to $31.6 million in the year-ago period.
Colombia has seen a significant increase in rebel attacks on oil and gas assets in recent months, with 67 such attacks occurring in the first six months of the year including an attack that killed five workers.
The attacks have cost the country an average of 11,000 barrels per day in lost production, according to Ecopetrol estimates.
The explorer said it was “working with the authorities, outside parties and Ecopetrol to look at multiple transportation and storage options to help mitigate the risk of pipeline disruptions”.
Dana Coffield pointed out that Gran Tierra Energy had more capacity to produce than ever before at 20,700 boe per day, adding that the three-month period had also seen the discovery of oil at Ramiriqui-1 in the Llanos basin.
Meanwhile, the company also announced a 40% rise in at its Costayaco field’s reserves net after royalty to 23.2 million barrels of oil, based on a new independent evaluation.
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