An upcoming Colombian government count of the country’s oil reserves is expected to show a decline, putting pressure on President Gustavo Petro to reconsider his ban on new fossil fuel contracts.
A National Hydrocarbons Agency report to be released later this month is expected to show that reserves fell last year from the previous assessment of 7.6 years and 8 years respectively , of crude oil and natural gas production, analysts said.
Despite the increase in international oil prices last year, the best case scenario is that crude oil reserves would remain flat, according to Daniel Guardiola, an analyst at Banco BTG Pactual.
While Petro’s administration has refused to issue new oil exploration licenses, the energy, finance and industry ministries in March said the reserves report would be key in determining policy.
“We are already seeing the impact of the uncertainty created by this administration and there is no reason to think that things will change,” said Sergio Cabrales, a professor at the University of Los Andes in Bogotá. “New contracts should come with attractive terms and everything we’ve seen so far is quite the opposite.”
Last year, lawmakers barred oil and coal companies from deducting royalty payments from corporate taxes and imposed a windfall tax. Congress is currently considering a ban on fracking.
