The battle between energy security advocates, who want to boost oil production, and environmentalists is heating up in Colombia. While a Colombian oil and gas industry group says Colombia must increase its crude oil production to ensure the country’s energy security, activists are fighting to stop fracking. With presidential elections approaching, the future of Colombia’s energy is at stake. The Colombian Petroleum Association (ACP) warned this week that Colombia could lose its energy self-sufficiency as early as 2028 if it doesn’t take action soon to boost oil production. Maintaining production at current levels could lead to greater investment in the country and generate revenues of around US$25.9 billion under the next government, keeping Colombia from having to import gas and oil from 2026 and 2028 respectively.
AKP President Francisco Lloreda specified, “Colombia has the resources to be self-sufficient on matters affecting (oil and gas).” And “If anything what’s happening in Europe teaches us, it’s that self-sufficiency is key,” he added. The Russian invasion of Ukraine and subsequent sanctions on Russian energy has prompted governments around the world to focus more on energy self-sufficiency.
But while oil and gas companies struggle to keep Colombia’s fossil fuel industry alive, environmentalists are taking to the streets to oppose fracking. The town of Puerto Wilches in the oil-rich region of Santander Magdalena Medio is set to become the site of Colombia’s first fracking development. But many local residents reject the project. However, several activists were in the region threatened for protestingprevent others from doing the same.
In 2018, a temporary ban on fracking has been introduced in Colombia with the exception of pilot projects. This indicated that fracking could be allowed in the future. But after widespread local opposition to developing a fracking development, the potential for major crude oil production may be limited.
State oil company Ecopetrol announced earlier this month that it believes commercial fracking operations have the potential to add 12 to 15 years to oil and gas production. A suspended environmental license for a pilot fracking project is expected to be reconsidered in June, with the potential to start operations in Santander. Ecopetrol sees fracking as a necessary step to ensure Colombia’s energy self-sufficiency in the coming years.
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Ecopetrol and partner ExxonMobil are allowed to continue research for the pilot project while the administrative court decides whether to allow commercial development of the fracking site. The pause in operations came after a judge ruled that local communities had not been consulted about the development. However, following an appeal, Ecopetrol is confident it will be able to proceed with drilling 150 to 200 fracking wells. It hopes that if the operation is permitted, each of the wells could produce around 1.1 to 1.2 million barrels of oil equivalentwith a service life of 20 to 25 years.
While the oil operation is currently the subject of controversy, Colombia’s gas operations are looking upbeat. Frontera Energy plans to increase long-term natural gas production at its operations in the lower Magdalena Valley. The energy company has already increased its production significantly over the last year, with conventional gas production of 9.53 Mf3/d in the first quarter of 2022 compared to 4.66 Mf3/d in the same period of 2021.
Orlando Cabrales, CEO of Canadian company Frontera Energy, specified, “We do not expect any significant changes in our gas portfolio or in the production mix in the short term. But it is very important to note that in the lower Magdalena Valley we have had a significant increase and positive results [from other] acreage in the past.” And “Additional exploration and development activity in the lower Magdalena Valley could further increase our interest in gas,” he added.
Frontera plans to invest $225 million to $255 million in its Magdalena gas operations. In addition, the company plans to develop a solar power generation system by 2023 to support its operations.
However, with the upcoming presidential election, Colombia’s energy outlook could change quickly. Earlier this year, Colombian senator and presidential candidate Gustavo Petro urged the rest of Latin America to move away from fossil fuels and demonstrate its stance on the oil and gas industry. But most expect that oil and gas will continue to contribute to the country’s energy mix under the next administration, regardless of who wins. If Petro wins, he’ll likely map out a strategy for the eventual national transition to renewable energy.
Juan Carlos Arenas, Director of Political Studies at the Universidad de Antioquia in Medellín expressed his expectations from the elections: “He didn’t insist on curbing the exploitation of oil resources or coal mining, but on a suspension of this business model. Opponents often claim he says there will be no more oil production. That would be stupid. As far as I know, the proposal is more closely related to how this period can be used to design an effective energy transition process.”
There is no clear vision of what the Colombian oil and gas industry will look like ten years from now. As the state energy company struggles to get its fracking project off the ground to ensure the country’s long-term energy self-sufficiency, residents in the region oppose the development. Moreover, if Petro wins the presidential election, Colombia’s energy transition could come sooner than many thought
By Felicity Bradstock for Oilprice.com
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