Colombia national oil company Ecopetrol SA’s (EC, ECOPETROL.BO, ECP.T) net income fell 4.4% last year compared with 2011 due to slightly lower oil prices and higher operational costs.

The company, one of Latin America’s largest publicly traded companies and the largest company in Colombia, also missed its 2012 oil production target of 780,000 barrels a day. It said output last year was 754,000 barrels a day of oil equivalent, 4% higher from 2011.

Ecopetrol’s consolidated net income last year was 14.8 trillion pesos ($8.3 billion) compared with COP15.5 trillion in 2011, it said. For the fourth quarter, its net profit was COP3.6 trillion, down 18% from that quarter a year earlier.

Javier Gutierrez, Ecopetrol’s chief executive, said last year “was quite challenging for Ecopetrol. Various circumstances related to operations and the overall environment were addressed in order to attain growth and positive results for our shareholders.”

Ecopetrol’s stock price rose nearly 30% in 2012, most of the gains coming in the first three months of the year.

A reduction in guerrilla violence in Colombia over the past 10 years has allowed Ecopetrol and other oil firms to expand exploration and drilling to regions once deemed too dangerous. This is a main factor in the overall rise in recent years in oil production from Ecopetrol and Colombia in general, which is now Latin America’s 4th-largest oil producer.

Despite efforts toward ending the guerrilla war completely, Colombia’s two main rebel groups, the FARC and ELN, remain potent and last year there was a worrisome rise in attacks on oil infrastructure, which the rebels view as strategic targets. Bombings of oil pipelines are partly to blame for Ecopetrol’s 21% rise in operational costs last year.

The firm’s consolidated earnings before interest, taxes, depreciation and amortization, or Ebitda, which is an indicator of a company’s cash flow, was COP29.3 trillion last year, down 2% from 2011.

Ecopetrol is nearly 90% owned by the government, while the rest is traded on stock markets. The company’s shares trade on the Colombian Stock Exchange and in New York.

Analysts were expecting a decline of about 3% in Ecopetrol’s net income last year. The company’s share price fell 0.7% Friday in Bogota to COP5,410.

Read more: