Ecopetrol Renews Permian Basin Joint Venture with Occidental Petroleum
Colombian energy giant Ecopetrol has secured a renewed joint venture agreement with Occidental Petroleum for oil exploration and production in the U.S. Permian Basin in Texas.
The agreement follows uncertainty surrounding the future of the partnership after Ecopetrol's withdrawal from a separate $3.6 billion Permian basin asset acquisition deal with Occidental last year, as ordered by Colombian President Gustavo Petro.
Ecopetrol's CEO Ricardo Roa stated that under the new plan, Ecopetrol Permian will invest over $880 million by 2025 to develop assets in the Midland and Delaware sub-basins, potentially involving 91 development wells.
The Midland sub-basin agreement allows for potential contract extensions, subject to market conditions and company interests. A separate contract has been established for Delaware sub-basin development until 2027.
Ecopetrol's Permian basin operations have significantly boosted its production, with oil and gas output rising by almost 62% to 95,200 barrels of oil equivalent per day (boed) in the first nine months of 2024, despite declines elsewhere.
The contract extension will enable Ecopetrol to produce close to 90,000 boed, Roa confirmed, without specifying whether this is in addition to existing production.