• Bid numbers below expectations amid low oil price, budget cuts
  • `Ronda Ecopetrol' comprises four stages, seeks to reduce risk

Colombia’s state-controlled Ecopetrol SA has received four bids for onshore exploration areas, missing company expectations as low oil prices and budget cuts curbed participation.

The bids come from international drillers that already have a presence in the Andean nation, according to Ecopetrol Exploration Vice President Max Torres. Earlier this year Colombia’s main oil producer announced a divestment program called ‘Ronda Ecopetrol’, following suggestions from the Boston Consulting Group to reduce risk and generate cash.

The divestment program is divided into four stages, offering companies a chance to bid for a maximum 50 percent stake in exploration contracts where Ecopetrol currently has a 100 percent interest. The first two stages this year each offered stakes in eight contracts, receiving a total of four bids.

“Many companies came, but we didn’t receive a lot of offers,” Torres said in a Bogota interview Thursday. “It’s understandable. Oil prices are very low and exploration is no longer a priority for many companies.”

Ecopetrol hopes to close the deals in two or three months, Torres said, declining to say where the contracts are located or how much the farm-outs will generate for Ecopetrol. Bids for a further eight contracts in the third stage of the divestment program are expected Dec. 14. A final stage will take place in 2016.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE