April 16 (Bloomberg) -- Ecopetrol SA won authorization from Colombia’s Finance Ministry to sell as much as $2 billion in overseas bonds by 2016 as the state-controlled oil producer seeks funding for exploration and production.
Colombia’s biggest company is struggling to meet output targets amid a surge in pipeline attacks by Marxist guerrillas. Ecopetrol said in its financial plan published in December that it planned to invest $75 billion through 2020 to boost output by 63 percent to 1.3 million barrels a day and raise the average life of its reserves to 10 years.
The authorization is “part of the procedures required for keeping available different debt alternatives to finance its long-term investment plan,” the company said in a statement.
The company is 88.5 percent-owned by Colombia’s government and rated BBB by Standard & Poor’s, the second-lowest level of investment grade. Its $2.5 billion bond offering in September was the first since 2009.
Ecopetrol dropped 2.3 percent to 3,870 pesos at 9:29 a.m. in Bogota, extending its decline over the past 12 months to 11 percent, the biggest after Petroleo Brasileiro SA among oil companies with a market capitalization of more than $50 billion.
Pipeline bombings have risen sevenfold since 2010, according to the Defense Ministry. The Revolutionary Armed Forces of Colombia, or FARC, is trying to damage an industry accounting for more than half of the Andean nation’s exports.
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