Ecopetrol Cuts 2012 Output Target on Rebel Attacks
Average output will reach 780,000 barrels a day, according to a presentation today on the Bogota-based company’s website. The state-run company as recently as this month forecast average output of 800,000 barrels a day.
“It’s surprising since it’s the first time they’ve changed it,” said Juan David Pineros, an analyst at Interbolsa SA (INTBOL), Colombia’s largest brokerage, which recommends holding the stock. “The first half of the year didn’t help much with reaching that goal.”
Guerrillas have increased attacks on pipelines and oil fields, raising transport costs and hampering production gains at Ecopetrol. Rebels have targeted infrastructure as an armed conflict with the Colombian government stretches into its fifth decade. Colombia is South America’s third-largest crude supplier.
Ecopetrol fell 2.5 percent to close at 4,870 pesos in Bogota, the biggest drop in a month. The decline dragged Colombia’s benchmark COLCAP (COLCAP) stock index down 1 percent to 1,642.76, the lowest close since June 29.
Second-quarter profit fell at Ecopetrol as costs rose and prices slid, missing analysts’ forecasts.
Net income slid 2.4 percent to 3.66 trillion pesos ($2.03 billion), from 3.75 trillion pesos a year earlier, the company said yesterday after markets closed. Profit trailed the 4.17 trillion-peso average of four analyst estimates compiled by Bloomberg.
The company still expects to reach targets to increase production to 1 million barrels a day in 2015 and 1.3 million barrels in 2020, Exploration and Production Vice President Hector Manosalva said on a conference call with analysts.
Shares of Ecopetrol have returned 35 percent in U.S. dollar terms this year, the best performance among major oil producers with a market value of more than $50 billion, according to data compiled by Bloomberg.
Venezuela and Brazil are South America’s largest crude suppliers.
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