CARTAGENA, Colombia (Dow Jones)–Ecopetrol SA (ECOPETROL.BO, EC), Colombia’s state-run oil firm, will not carry out any stock issuances or debt sales in 2012 to finance expansion projects, chief executive Javier Gutierrez said Friday.
The company has the option to carry out a share sale for an 8.5% stake but will forego that this year, Gutierrez said on the sidelines of a business conference running parallel to the Summit of the Americas in the coastal city of Cartagena.
“With the price of oil as it is right now we won’t need any financing,” Gutierrez said. “The direction of oil prices has been very positive.”
The company plans to invest $8.47 billion this year and Ecopetrol has already secured this financing, Gutierrez said. “For now we are not expecting to come to the markets.”
The government, meanwhile, has presented a project that would allow it to sell an additional 10% stake in the company to finance public spending projects.
Colombia has seen massive inflows of foreign investment to develop its oil and natural-gas industries as a result of the government’s market-friendly policies and its success over the past five years in gaining control of territory once held by Marxist guerrillas.
A recent surge in attacks by guerrillas against oil pipelines, along with protests by local communities, has slowed the growth of Colombia’s oil output. The government, however, insists it will soon reach the oil production milestone of pumping 1 million barrels of oil per day.
Gutierrez said the government and Colombia’s security forces had demonstrated “a great reaction capacity” to limit attacks against the oil industry.