Exploration and Production
Increase in Reserves
The proven hydrocarbon reserves of Ecopetrol and its affiliates (corporate group), with estimates based on the technical and reference price methodology of SEC, amounted to 1,878 million barrels of oil equivalent (Mboe)at the end of 2009, which represented a 35.5 per cent increase as compared with 2008.
The reserve replacement rate under this methodology increased by 359% as compared with 2008. Similarly, proven hydrocarbon reserves of Ecopetrol and its affiliates (corporate group), with estimates based on the technical and reference price methodology of SEC, but sing Ecopetrol reference prices, amounted to 1,793 (Mboe) at the end of 2009, which represented a 22 per cent increase as compared with 1,474 Mboe in 2008.
With the latter methodology, the reserve replacement rate was 269%. This means that for each oil barrel or equivalent gas produced, Ecopetrol and its affiliates incorporated over two new proven barrels.
The sources for adding reserves were the revaluation of producing fields by 394 Mboe, recent acquisitions for 114 Mboe, and new discoveries for 44 Mboe.
The region adding more serves was the Central region (47%), located in the Department of Meta, mainly from the Castilla and Chichimene fields, which are operated directly by Ecopetrol and are the axis for the country’s heavy crude strategy, with a record production of over 90 thousand barrels per day in the year 2009. It was followed by the Northeastern region (22%), where the Pauto field, located in the Department of Casanare and under association with BP, is to be highlighted.
As regards the reserve figures presented as corporate group, including its affiliates in Colombia and abroad, 98% were certified by three different specialized firms (Gaffney, Cline & Associates, Ryder Scott Company and Degolyer and McNaughton). Out of 1,793 Mboe, Ecopetrol S.A. contributes 95%, followed by Hocol with 3% and its share in Petrotech with 2%.
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Exploration
Material achievements were recorded in the exploration activity in the year 2009, both national and International, with the target of producing one million barrels per day by the year 2015.
In the year 2009, exploration activities added up to US$510 million. It is worth noting that out of this total, US$346 million were allocated to acquiring new geological and geophysical data, in line with the positioning strategy in high exploration impact areas, not only in Colombia, but also in Brazil, the Gulf of Mexico (USA), and Peru.
Investment in exploratory drilling amounted to US$164 million, which resulted in five new discoveries (3 in the Eastern Plains Region, 1 in the Magdalena Upper valley and 1 in Putumayo), with an exploration success rate of 28%. These discoveries will be incorporated as proven reserves in the short term (as regards the Putumayo discovery, these reserves were incorporated in the year 2009).
It is also worth to highlight the increased International exploration activity, particularly the positioning in the Gulf of Mexico and Brazil, where 49% of the investment was made. In the Gulf of Mexico the company was awarded 22 blocks in Lease 208, in 7 of which Ecopetrol has 100% holding, in 7 of them it shares with Repsol, in 4 with Eni and in 4 with Stone. In Brazil, it has shares in two blocks in the de Espirito Santo basin, operated by Repsol, and it also entered in Peru on two exploration blocks operated by Petrobras.
Furthermore, it participated in the drilling of 3 exploratory wells in the Gulf of Mexico and in one offshore well in Brazil. With regard to seismic data, we were involved in the acquisition of 4,810 kilometer equivalent.
In Colombia, the strengthening of our exploration portfolio is to be highlighted, through the awarding of high potential areas and the identification of new exploration opportunities. We acquired 4 high impact blocks: 2 in the Easter Plains Foothills, 1 in the Middle Magdalena Valley, and 1 in the Eastern Plains basin, all 100% Ecopetrol.
In relation with exploration opportunities, the data acquired in recent years has translated in 43% increased materiality of opportunities in the years 2008 and 2009. As regards exploration drilling, Ecopetrol drilled 9 exploratory wells directly and participated in 6 more.
In addition, in association contracts in which Ecopetrol does not share the investment risk, 9 exploratory wells were drilled. Relative to seismic data acquisition, Ecopetrol acquired or participated in the acquisition of 5,060 kilometer equivalent, and the companies in the association contracts with 627 kilometer equivalent.
Another fundamental aspect of the exploration activity in the year 2009 was the outstanding results of the delimitation campaigns performed by Ecopetrol associated companies. In particular, it is worth mentioning the progress in Rubiales (Eastern Plains), Moriche (Middle Magdalena Valley) and the Pauto complex (Eastern Plains Foothills).
Workers in Apiay, one of the main heavy crude
production centers in the department of Meta
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