In line with what was stated in its campaign proposals, the Government of Gustavo Petro has confirmed the suspension of the signing of hydrocarbon exploration contracts until 2026. It did so in the voice of its highly visible Minister of Mines, Irene Vélez, at the height of the summit of the World Economic Forum (WEF) in Davos, the annual epicenter of the financial and business world. The declarations, which mean that the future of oil in Colombia will depend on the success of the contracts already signed, did not take long to make a dent in the circuits of power, and numerous voices were raised publicly against an abrupt interruption against the main source of foreign currency income.
The previous three governments, in fact, have devoted themselves during the millennium to the task of turning the country into an oil economy. Today, together with gas and coal, it constitutes half of the country’s exports. For this reason, the first question for several critics is, with what economic activity will the measure be compensated, once the exploitation of hydrocarbons decreases? The former Minister of Mines and Energy Tomás González fears that the Government is still unclear.
“No one is saying that the energy transition should not be carried out”, explains the current director of the Regional Center for Energy Studies, “or that the fight against climate change is not important. The only thing we are asking for is an orderly process and clarity about the responsibilities we are embarking on”. He recalls, for example, that a quarter of direct foreign investment is concentrated in the hydrocarbons sector: “What will happen to exports? Where are they going to get the money to pay, precisely, for the energy transition, with a fiscal mess of that magnitude?
His doubts about the lack of a well-defined emergency plan summarize the fear of a good part of the trade union sector, but also of experts such as the oil engineer Óscar Vanegas, who assures that with the 330 exploration and exploitation contracts in force in “6 to 8 years the country would have to start importing oil”.
It doesn’t make much sense, according to most critics, to embark on such a steep path at a time when the world economy is trying to navigate various obstacles, and in a country whose CO2 emissions are marginal. “The government’s argument,” says Tomás González, “that the signed exploration and production contracts are enough, is not a strong argument.”
Studies conducted by geologists and official authorities, González continues, show that Colombia could have underground, according to prudent estimates, potential reserves of 9 billion barrels. In the same way, it is estimated that proven reserves today amount to 2 billion barrels: “If one looks at what is yet to be discovered, according to studies, it would be absurd to renounce, translated into similar figures, 75 tax reforms like the one that It was approved last year.
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On the other side is the coordinator of the Stockholm Environment Institute in Latin America, Elisa Arond. The academic values the determination of the Government and suggests that, although it will be difficult, it will bring benefits that are not usually cited these days in the Colombian press: “international attention to an actor that is positioned first in the region can bring more access to international cooperation, recognition as a competitive actor in a transformation context, or financing for clean energy”.
His speech highlights the benefits of an “unprecedented approach” for Colombian society. Remember that the ‘boom’ and the days of euphoria for raw materials are a thing of the past and find it reasonable that the Government tries to focus its effectiveness on already existing contracts: “We have been seeing for a while that, despite the large tenders held, and all the perks for the oil companies, the success of the discoveries has been very modest”.
Something similar thinks the engineer Vanegas, who recites the figures from memory: “In 18 years of life, the National Hydrocarbons Agency (ANH) has signed 600 exploration contracts and has only found 11 billion barrels.” He specifies that it is “little or nothing”. And he adds that only “880 million barrels have been added to proven reserves, which is equivalent to the production of two years.”
The academic Esteban Rossi, professor at the Javierana and Rosario universities, emphasizes that the scientific evidence is clear that the energy transition will last decades. A long-term process, he repeats, time after time. “The Colombian government, and especially the minister, insists on ignoring this and on making some very thick simplifications that generate a lot of confusion.”
From there, he shows his discomfort with the decision, contradictory in his opinion, to dispense with gas exploration in the same package (whose reserves have been calculated to last another 8 years): “no country in the world, let alone a middle-income country like Colombia, has been able to make the energy transition without natural gas, compatible with our infrastructure, clean and cheaper than the Internet in some places”. Including gas in that discussion, he concludes, is a notable strategic and environmental reading error.
Depending on the price of a barrel of crude oil in the future on Russian roulette is no longer a very viable option, the sources consulted agree. Searching for alternatives is imposed on the agenda as an urgent matter. Tomás González recalls that, in fact, this is the line adopted by Ecopetrol, the largest company in the country and with a state majority: “Felipe Bayón, the president, made it clear in Davos: we must meet the demand for gas and oil Because it’s there and it’s not going to go away. But in parallel, he is leading an agenda in research, in the production of blue and white hydrogen, in the production of small hydroelectric plants or in renewable energy programs ”.
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