Colombia calls halt to new oil and gas contracts

Jan 23, 2023 News

Kaieteur News – UPSTREAM ONLINE – The Colombian government has decided it will not issue new oil and gas exploration contracts and instead will direct investments to tourism and renewable-energy sources.

Colombia Mines and Energy Minister Irene Velez. Photo: REUTERS/SCANPIX

Colombia’s President Gustavo Petro took office in August after running a campaign promising to halt new hydrocarbons developments, phase out fossil fuels and develop clean energies.

Speaking in a panel on energy transition from the World Economic Forum in Davos, Switzerland, Colombia Mines and Energy Minister Irene Velez said the decision to stop granting new licences will not affect existing contracts.

This policy had been pledged during the campaign, but soaring global energy prices had led to suggestions that Petro would backtrack and offer new acreage.

“We have decided not to award new oil and gas exploration contracts, and while that has been very controversial, it is a clear sign of our commitment in the fight against climate change.

This decision is absolutely urgent and needs immediate action,” Velez told the panel.

Colombia had 381 active exploration and production contracts at the end of November, according to a government report.

Of that total, 331 are under the supervision of the country’s hydrocarbons regulator ANH, another 49 are supervised by Colombian state-controlled oil company Ecopetrol and one is a concession contract.

While oil accounts for about a third of Colombia’s exports, the government report suggests that current exploration and production contracts guarantee the country’s self-sufficiency in natural gas for the next 15 years.

Hours after Velez’s speech, Petro assured that tourism and clean energy could replace the weight of oil in the Colombian economy in the short-term.

“A big investment in tourism, given the beauty of the country, and the capacity and potential that the country has to generate clean energy, could perfectly, in the short term or as part of a transition, fill the void left by fossil fuels, on which we depend,” he told journalists in Davos.

Petro added the world needs to have an agreement to move away from fossil fuels by reducing the consumption of coal, oil and gas.

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Colombian, Contract, Exploration, gas, Government, oil

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