Mining And Oil Boom Propel Investment In Colombia
He would not name the oil companies, for his own security.
Companies operating or exploring in Meta and Guaviare include Canadian-owned Pacific Rubiales, Exxon Mobil Corp., Brazilian-owned Petrobras, and Petrominerales â¿¿ a Colombian affiliate of Canadian-owned Petrobank.
"Part of the reason why Colombia, unlike many of its neighbors, was forced to provide so many tax incentives and regulatory sweeteners was precisely because they had to deal with that legacy of insecurity," Esteruelas said.
Those incentives helped persuade Pacific Rubiales to begin investing in Colombia in 2004, said the company's vice president, Jose Francisco Arata.Colombia's second-largest oil company after Ecopetrol, Pacific Rubiales moved into formerly rebel-held areas of Meta and its production is now up to 125,000 barrels a day. Over the next year, the company plans to invest $235 million in further exploration in the eastern plains, as well as in the lowlands of the southern state of Putumayo â¿¿ both areas of continued rebel activity. "In areas that are considered a high risk, like in the border regions with Venezuela and Ecuador, military forces will accompany oil operators," said Armando Zamora, regulator for the National Agency of Hydrocarbons. Just last year, he said, the Revolutionary Armed Forces of Colombia, or FARC, burned some trucks and tried intimidating workers during an oil operation in the southern state of Putumayo, which borders Ecuador. He wouldn't detail the incident. To Rodriguez, the former environmental minister, the intimidation, violence and extortion are simply the price of doing business in Colombia. After all, he said, major coal operations began in Colombia during the peak of its conflict. "Historically, the country's violence hasn't been the biggest difficulty for outside companies," Avila said. "The biggest difficulty was that they didn't know the region. And now that they've done preliminary studies and know, they're investing more."
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV