Ecopetrol SA (ECOPETL), the world’s best- performing major oil producer, said second-quarter profit fell as costs rose, missing analysts’ forecasts.
Net income slid 2.5 percent to 3.66 trillion pesos ($2.03 billion), from 3.75 trillion pesos a year earlier, the Bogota- based company said yesterday after markets closed. Profit trailed the 4.17 trillion-peso average estimate of four analysts surveyed by Bloomberg.
Guerrillas have stepped up attacks on pipelines and oil fields, increasing transport costs and hampering production at state-run Ecopetrol. Rebels are targeting infrastructure as an armed conflict stretches into its fifth decade in Colombia, South America’s third-largest crude supplier.
“Most oil activity is in rural areas where armed groups have a presence,” said Mauricio Hernandez, an analyst at Corredores Asociados SA in Bogota, which has a hold recommendation on Ecopetrol. “So it puts production targets at risk.” Hernandez doesn’t own the company’s shares.
Production at Ecopetrol, Colombia’s largest oil company, rose 4.8 percent to 762,200 barrels a day in the second quarter from 727,200 barrels a year earlier. It climbed from 743,400 barrels a day in the first quarter.
Guerrillas this week blasted part of Ecopetrol’s Cano Limon-Covenas pipeline, causing an oil spill in eastern Colombia. Carrying oil by truck is more costly, according to Hernandez.
Ecopetrol rose 0.9 percent in Bogota trading yesterday to close at 4,995 pesos. Shares have returned 35 percent in U.S. dollar terms in 2012, the best-performing major oil producer with a market value of more than $50 billion, according to data compiled by Bloomberg. The company has surpassed Total SA, (FP) Statoil ASA and Gazprom OAO to become the world’s seventh- largest with a market value of $114 billion.
Ecopetrol is investing in decades-old fields in Colombia and exploring in the U.S. Gulf of Mexico, Brazil and Peru as part of an $80 billion expansion plan to increase output to 1 million barrels a day in 2015 and 1.3 million barrels in 2020.
This year, Ecopetrol plans to reach a record 800,000 barrels a day from an average of 724,100 barrels a day in 2011. The government is taking steps to increase security to defend energy infrastructure from sabotage, Mines and Energy Minister Mauricio Cardenas said this week.
“The rebels want to send a message to discourage investment,” said Cesar Cuervo, an analyst at Bogota-based brokerage Correval SA, which has a hold recommendation on the stock.
The Colombian government owns 88.5 percent of Ecopetrol.
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