2. Disclaimer
This document was prepared by Ecopetrol S.A. with the purpose of providing the market and interested
parties certain financial and other information of the Company.
This document may include strategy discussions and forward-looking statements regarding the probable
development of Ecopetrol’s Business. Said projections and statements include references to estimates or
expectations of the Company regarding its future and operational results. Potential investors and the
market in general should be aware that the information provided herein does not constitute any guarantee
of its performance, risks or uncertainties that may occur or materialize. Real results may fluctuate and
differ from those provided herein due to several factors outside of the control of the Company. Neither
Ecopetrol nor its advisors, officers, employees, directors or agents, make any representation nor shall
assume any responsibility in the event actual performance of the company differs from what is provided
herein. Moreover, Ecopetrol, its advisors, officers, employees, directors or agents shall not have any
obligation whatsoever to update, correct, amend or adjust this presentation based on information attained
or events occurred after its disclosure.
This presentation is for discussion purposes only and is incomplete without reference to, and should be
viewed solely in conjunction with, the oral briefing provided by Ecopetrol. Neither this presentation nor
any of its contents may be used for any other purpose without the prior written consent of Ecopetrol.
2
5. Capex plan focused on E&P has lead growth since 2008
Growth
Capex
2008-2012 ( e )
2007 vs. 2011/2012
Production
11%
750 mboed (Jan-Sep 2012)
10%
Total Capex
USD 32.9 bn
8%
1.9 X
15%
11%
45%
Reserves (1P) 1.5 X
1.8 bn boe (Dec. 2011)
Ebitda
3.4 X
Market Cap
4.7 X
USD 15.1 bn (2011)
Production
Acquisitions
Transportation
Refining & Petroch.
Exploration
Other
Source: Ecopetrol
USD 128 bn (Dec. 2012)
5
6. Ecopetrol is Colombia´s top player and holds interests
in the U.S., Brazil and Peru
Ecopetrol and interests in subsidiares & affiliates
E&P:
america
Ref.& Petchem. :
Transport:
CENIT
Biofuels:
PERU
Key figures:
*
Upstream
• Production: 750 mboed
• Exploratory area: 21.3 mn has.
• 1P Reserves : 1.86 bn boe
*Figures for Jan-Sep 2012 except
for 1P Reserves as of Dec. 31. 2011
Source: Ecopetrol
BRAZIL
Midstream
• Crude transport:
895 mbd
• Products transport: 303 mbd
Downstream
• Refining capacity: 330 mbod
• Petrochem. prod.capacity: 500k tons /yr
• Biofules prod. capacity: 100k tons / yr (biodiesel)
Sales & Marketing
• Sales : 874 mboed
• Exports 60% / Colombia 40%
6
7. Strategic plan with a Capex of USD 80 bn to reach a
production of 1.3 mn “clean” barrels by 2020
USD 80 bn
1.3 mn boed
1.3 million boed
“Clean barrels” in 2020
• No accidents
• No environmental
incidents
• Sound labor relations
• Delivering commitments
to stakeholders
• 17% ROCE
Biof. & other
Transport
Refining
Exploration
3%
5%
7%
25%
Production
60%
Capex 2012-2020
Source: Ecopetrol
• 85% allocated to E&P
• 90% in Colombia
7
9. Remarkable rise in production led by heavy oil in Colombia
Average production / year
(thousand barrels of crude oil and gas per day)
1,300
1,000
399
72
521
447
616
104
97
85
270
253
81
109
153
224
2007
2008
2009
2010
Source: Ecopetrol
780
108
280
289
246
Heavy oil
724
336
2011
Light and medium oil
2012 (e)
2015 (e)
2020 (e)
Natural gas
9
10. Upstream strategy has four drivers that rise production to 1.3 mn
“clean” barrels in 2020 and add 6.2 bn barrels of 1P reserves
1
1
Production &
Recovery Factor:
Prod: 840-870 mboed
2
3
• Primary/Secondary/Tertiary Recovery
• EOR/IOR (Enhanced Oil Recovery/Improved Oil Recovery)
2
Exploration
Colombia:
• Llanos Orientales
• Caribe Offshore
• Caguan-Putumayo
• Sustained activity in other basins
International:
• Brazil
• Gulf of Mexico (U.S.)
• Peru
Exploration
Prod: 260-410 mboed
Unconventional
Prod: 50-200 mboed
3
4
Production and Increase Recovery Factor
Acquisitions
4
Unconventional
• Assesment of potential
• Joint ventures with strategic partners
Acquisitions
10
11. 1
Production of current fields supported by drilling,
non-thermal recovery, and thermal recovery
Workstreams
Drilling
Key Initiatives
Primary recovery
• Infill Drilling
• New area development
• Optimize well configurations
Screening and projects
• Llanos Orientales
Horizontal and
multilateral wells • Middle Magdalena
Thermal
Recovery
Tertiary recovery
• Cyclic or continuing steaminjection process
• In situ combustion
Water Flooding
(135 fields)
Gas Injection
Non Thermal
Recovery
Secondary and tertiary recovery
• Water injection
• Alternating water and gas injection
• Chemical injection
• 21 fields implemented
• Casabe
• La Cira
• Upper Magdalena
• 21 projects in progress
• 93 fields to be implemented
• South: 5 Projects
• Magd & Central: 6 Projects
In situ
• Chichimene (pilot)
• Quifa (pilot)
Continuous
Injection
• Teca
Cyclic Injection
• Santa Clara
11
12. Upstream strategy has four drivers that rise production to 1.3 mn
“clean” barrels in 2020 and add 6.2 bn barrels of 1P reserves
1
1
Production &
Recovery Factor:
Prod: 840-870 mboed
2
• Primary/Secondary/Tertiary Recovery
• EOR/IOR (Enhanced Oil Recovery/Improved Oil Recovery)
2
Unconventional
Prod: 50-200 mboed
3
4
Exploration
Colombia:
• Llanos Orientales
• Caribe Offshore
• Caguan-Putumayo
• Sustained activity in other basins
International:
• Brazil
• Gulf of Mexico (U.S.)
• Peru
Exploration
Prod: 260-410 mboed
3
Production and Increase Recovery Factor
Acquisitions
4
Unconventional
• Assesment of potential
• Joint ventures with strategic partners
Acquisitions
12
13. Ecopetrol´s exploratory plan is focused in proven
basins in Colombia
2
Yet to Find per Sedimentary Basin (mmboe)
Magdalena
Lower
Valley
10.000
5.500
3.585
2.000
4.000
2.636
Catatumbo
2.000
1.500
1.000
913
750
366
650
304
Magdalena
Mid Valley
550
Llanos /
Foothills
250
150
100
Magdalena
Upper Valley
90
60
40
10
Putumayo
Llanos/ M. Magd. U. Magd. Catatum. Putumayo L. Magd.
Foothills
Valley
Valley
Valley
Mean
Source: Ecopetrol
13
14. Estimated contingent resources in Colombian
frontier areas of 15 bn boes (mean)
CARIBBEAN OFFSHORE
PMEAN 2,900 MMBOE
380-14,000 MMBOE
Potential (mn boe)
SINU
PMEAN 414 MMBOE
50-900 MMBOE
STRAT TEST VMM
PMEAN 92 MMBOE
50-200 MMBOE
PACIFIC
OFFSHORE
PMEAN 600
MMBOE
50-1,500MMBOE
31000
10000
13948
2000
1000
MBPE
2
1500
661
950
900
433
401
200
100
50
70
116
50
250
115
50
20
10
HEAVY CRUDE OIL
PMEAN 418MMBOE
70-950 MMBOE
Source: Ecopetrol
Caribe Off
Carib.Off Pacifico Crudos Sinu
Pacif.Off Heavy Sinú
Off
Pes
oil
Estrat.
Strat
VMM
MMV
Cayos
Cays
Mean
14
15. 2
Ecopetrol has 37% of the total licensed acreage in Colombia
and operates in 6 strategic basins of high potential
Exploration assets*
Caribbean sea
(61 blocks)
14.5 mn hectares
4
Operated directly: 51 Blocks
Not operated:
10 Blocks
5
Basins
Ecopetrol S.A.
Hocol S.A.
Llanos – Catatumbo
2 Mid Magdalena Valley
3 Upper Magdalena – Putumayo
4 Offshore Caribbean
5 Lower Magdalena Valley
6 Offshore Pacific
1
Producing assets
Direct:
Partnerships:
Equion
2
Pacific ocean
51 Blocks
64 Blocks
2.1 mn hectares
(94% of Colombia´s production area)
* Does not include the blocks awarded in the Open Round Colombia 2012
Source: ANH, Ecopetrol
1
6
3
15
15
16. Basins in key countries with high potential
2
Yet to find per Basin
Reserves discovered in 2009
(bn boe)
v
v
v
Ecuador
Chile
Gas
Trin & To.
v
Colombia
U.S. West East Coast
Mexico
U.S. West Gulf Coast
Venezuela
Brazil Campos
Crude
Argentina
v
Brazil
Brazil Santos (presalt)
(mn boe)
Countries where Ecopetrol has interests
Source: Wood Mackenzie
16
17. 2
International exploration assets with 8.7 mn Has
U.S.A.
EC America
0.1 mn Has
Miocene
GOM
Paleogene
Jurassic
EC Peru
4.4 mn Has
Para Maranhao
Marañón
Ucayali
Huallaga
Sechura
Salaverry
Lima
Savia Peru
4.1 mn Has*
Marañón
Ucayali
Peru
Brazil
EC Brazil
0.1 mn Has
Campos
Santos
Espiritu Santo
Campos
Santos
Para-Maranhao
* Includes only Ecopetrol’s 50% interest
Source: Ecopetrol
17
18. Upstream strategy has four drivers that rise production to 1.3 mn
“clean” barrels in 2020 and add 6.2 bn barrels of 1P reserves
1
1
Production &
Recovery Factor:
Prod: 840-870 mboed
2
3
• Primary/Secondary/Tertiary Recovery
• EOR/IOR (Enhanced Oil Recovery/Improved Oil Recovery)
2
Exploration
Colombia:
• Llanos Orientales
• Caribe Offshore
• Caguan-Putumayo
• Sustained activity in other basins
International:
• Brazil
• Gulf of Mexico (U.S.)
• Peru
Exploration
Prod: 260-410 mboed
Unconventional
Prod: 50-200 mboed
3
4
Production and Increase Recovery Factor
Acquisitions
4
Unconventional
• Assesment of potential
• Joint ventures with strategic partners
Acquisitions
18
19. 3
Unconventional hydrocarbon potential in Colombia
120 - 1200 TCF (Karson, 1994)
HM - CARIBE
32 TCF GAC - GUAJIRA 2010)
(Arthur D´little,
GAC - CESAR
SH - CATATUMBO
GAC - MONTERIA
LA LUNA
FORMATION
SH - VMM
POZO COYOTE
GAC - CORDILLERA
SH- CORDILLERA
Methane Hydrate
Gas in Situ 434.2 TCF
Shale Oil/Gas
31.7 TCF (Highest
potential in Mid Magd
Valley 29 TCF)
Coal Bed Methane
7.5 TCF ( Highest potential
in Cesar 2,4 TCF and
Guajira 3,4 TCF)
Tight sands
1.2 TCF
HM - PACIFICO
SH - VSM
Tar sands
Potential Volume 23,762
mn boe
Ecopetrol focus areas
SH - PUT
Source: Arthur D´Little
19
21. Production goal for 2013 of 798 mboed
Goal 2013
Production 2011-2013
Ecopetrol including interest in subsidiaries
and affiliates (mboed)
2%
3%
10%
798
780
7%
Northeast
2%
27%
7%
15%
Central
East
Mid Magd.
Catatumbo
798 mboed
724
South
19%
18%
Hocol
Equión
Savia and
minor fields
2011
2012 (e)
2013 (e)
• Cupiagua
Fields with higher • Castilla
production growth • Chichimene
• Guajira
21
26. Barrels spilled due to operational causes
Accident frequency rate
(Bls / yr)
(hours lost per million worked hours)
3,91
158
2,46
Jan-Sep2012
2011
2010
2009
(Days)
Jan-Sep2012
2011
296
364
Jan-Sep2012
139
2010
145
499
2008
153
2010
2009
1,55
Non-scheduled turnarounds: B/meja + Reficar
248
2008
2,10
0
2008
2011
2009
Energy loss Index
163
160
0
Jan-Sep2012
10
0
2008
2007
6
2010
1,64
2006
1
Operational Excellence: Secure processes to preserve
safety, the environment and operational efficiency
26
27. 2
Value Creation: Modernization projects increase revenues
by maximizing output of medium distillates and gasoline
Barrancabermeja Production
250 mbd
250 mbd
0,5%
3%
4%
1%
3,1%
4%
Reficar Production
80 mbd
Petrochemicals
Petroquímicos
7%
165 mbd
7%
Propileno
Propylene
34%
40%
LPG
GLP
GLP
LPG
36%
54%
Destilados Medios
Mid Distillates
Gasolinas
Gasoline
34%
Fuel && Coke
Fuel Coque
29%
Fuel & Coque
Fuel & Coke
48%
1%
5%
Curent2012
(2012)
37%
28%
24%
With PMRB (2017)
Project
Current restrictions:
Mid Distillates
Destilados
Medios
Gasoline
Gasolinas
Curent (2012)
2012
With Project
With Project (2014)
Expansión
Reficar
1. Refineries configuration:
• Medium conversion constraints the production of gasoline and medium distillates.
• Diesel quality does not meet regulatory standards.
2. Supply: Imports to comply with Colombian environmental quality standards.
27
28. 2
Value Creation: Processing crudes based on the availability in
Colombia and reducing the cost of feedstock
Quality of crude basket:
Barrancabermeja
17%
10%
20%
Livianos
Light
7%
20%
19%
45%
Medios
Medium
70%
38%
2012
Current
(2012)
Quality of crude basket:
Reficar
With Project
After Project
PMRB
(2017)
93%
61%
Pesados y ácidos
Heavy & Sour
2012
Current
(2012)
Expansión
With Project
Reficar
(2014)
Current restriction in configuration: Limited load of heavy crude oil
(lower cost vs. medium and light crudes)
28
29. 3
Profitable & Sustainable Growth: Key projects in Refining
to improve profitability and meet market conditions
Reficar (Cartagena) refinery modernization project
•
•
•
•
•
Refining capacity from 80 to 165 mbd
High conversion from 76% to 97%
Processing of heavy, extra-heavy and sour crude oils
International fuel quality standards (sulfur content)
• Gasoline < 30 ppm
• Diesel < 10 ppm
Finding opportunities in the regional markets of
purchasing crude oil and exporting fuels
Scope
•
•
•
•
•
Crude Distillation
VDU
Coker
Hydrocracking
FCC revamp
•
•
•
•
•
FCC Naphtha HDT
2 ULSD Hydrotreater Units
2 Hydrogen Plants
Gas Plant
2 Sulfur Plants
29
30. 3
The modernization of Cartagena Refinery reached 71%
progress (as of Sep. 30 / 2012 )
Progress:
Weight
Site prep & FEED
EPC contract
Docks and tanks
Third party supplies,
comissioning and startup
Progress
10.0%
76.2%
5.8%
100%
73.2%
64.8%
Total Progress
23.0%
71.4%
Timeline:
Weight
Progress
Engineering
14%
97.2%
Procurement
51%
92.6%
Modules
8.0%
EPC contract
2%
100.0%
Construction
33%
31.3%
Total Progress
Executed Capex:
End of mechanical
completion
EPC
1Q-10 to 4Q -13
Capex
73.2%
Commiss. & Start up
3Q-13 to 1H-14
Description
Financing/insurance/taxes
Engineering-PMC
USD mn
321
901
Procurement
1,298
Construction
752
Other
Total
99
3,371
30
31. 3
Profitable & Sustainable Growth: Key projects in Refining to
increase the conversion factor and margin of the refineries
Barrancabermeja refinery modernization project
Revamps
New units
Capex
45 mbd of clean and valuable fuels
High conversion from 75 to > 95%
Processing of heavy, extra-heavy and sour crude oils
Domestic fuel quality standards (sulfur content)
Gasoline <150 ppm
Diesel <50 ppm
Scope
• Three new processing units:
• Delayed Coking
• Hydrocracking
• Coker Naphtha Hydrotreating
• Two Hydrogen Plants
• Six new utilities units
• Five new auxiliary units
• Environmental units: amine, sour water
and sulfur recovery
• LPG treating unit
• Storage tanks
31
32. 3
Modernization of Barrancabermeja refinery reached
12.3% progress (as of Sep. 30 / 2012)
Phases
Progress:
I,II y III
Weight
Conceptual and basic engineering
Progress
6.7%
100%
Detailed engineering
Procurement and Contracting
4.0%
Construction
1.3%
Commisioning
IV
4.9%
0.0%
Subtotal Phase IV
V
93.1%
6.0%
Closure
0.2%
0.0%
Total Progress
Timeline:
Executed Capex:
1Q-09 to 3Q-11
Phases
I, II & III
3Q - 17
Site Prep.
EPC
Commiss.
& Start up
Description
Engineering
Equipment purchases
Construction
PMC (Management and Control)
1Q-12 to 1Q-15
Capex
12.3%
2Q-13 to 2Q-17
Other Owner Costs
Total
USD mn
193.0
98.7
45.9
93.1
21.7
452.4
32
33. 3
Profitable & Sustainable Growth: Refining results in 2020 will improve
due to the execution of projects that add value to the crude oil
Process heavier crudes
and produce more
value added products
Optimize
operating costs
Utilities Project
Process heavier crudes
and produce higher
quality fuels
Barranca
modernization
project
Reficar Project
2012
2013
2014
Reficar Ebitda
2013: Starting of
updated refinery
2015
2017
2020
Barranca Ebitda
2017: Starting of
updated refinery
* Figures depend on international prices (crack spreads) behavior
33
34. 4
Market & Clients:
Rising Colombian demand for medium distillates & gasoline
*Ecopetrol’s Sales
(KBDC)
2011
2013 ( e )
2015 ( e )
Med. Dist.
131
140
149
Gasoline's & LPG´s
92
94
95
Liquid fuels consumption in Colombia**
Thousand barrels per day
350
300
CAGR
250
200
150
CAGR
100
50
0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Medium distillates
Gasolines
LPG
*Source: Ecopetrol and UPME (Mining and Energy Planning Agency). Total energy consumption Includes biofuels
34
35. 4
Market & Clients:
Strong commitment for better air quality
Sulfur content
(average parts per million)
4,500 4,500
Diesel
Other cities in Colombia
3,000 3,000
2500
Medellín
Bogotá & Public
Transportation Systems
In Colombia
2.130 2.037
1.2001200
500
2007
2008
1,000
178
341 215
28
2009
2010
727
176
20 20
2011
198
29 15
2012
1.000
700
Gasoline
214
2007
Source: Ecopetrol
2008
2009
2010
199
2011
2012
35
36. 4
Market & Clients:
Diversifying crude references and export destinations
Destinations of Crude Exports
Crude References
Caribbean Other 3,8%
Other U.S.
3,2%
and
Canada
10,4%
Europe
7,4%
441 mboed
Jan-Sep 2012
U.S. West
Coast 7,7%
Central
America
10,3%
Source: Ecopetrol
Other 4% WTI 1%
U.S. Gulf
Coast
42,9%
Maya 21%
Brent 75%
Far East
14,3%
36
37. Market & Clients: Developing gas market
4
Sufficiency and exportable surplus
Total consumption: Colombia + Exports
(GBTUD)
907
721
1,036
1,061
1,062
1,086
SUPPLY AND NEW FINDINGS
Conventional
• Offshore Caribbean: 9 - 35 TCF
• Foothills: 1 - 4 TCF
760
Unconventional
• Gas Shale: Mid Magdalena Valley and Catatumbo 1532 TCF
2006
2007
2008
2009
2010
Refineries
Petrochemical
Industrial
CNGV
Power Plants
2011
1H-2012
Colombian Gas Balance
LDC
Exports
LDC: Colombian gas utility companies
CNG: compressed natural gas
Source: Ecopetrol
37
38. 4
Market & Clients:
Growing in biofuels through current and new projects
Biodiesel
Production of Biofuels
(thousand tons per year )
• Max. Capacity : 100,000 tons/yr (2,000 bls/day)
• Production 2011: 99,304 tons
• Blending of 2% biodiesel at Barranca refinery
• Ecopetrol´s interest: 50%
380
450
280
180
Ethanol
100
2011
• Total Capex US$282 million
• Start of operations: 2nd quarter 2013
• Max. Capacity: 480,000 liters/day
• Future blending of 10% through wholesalers
• Ecopetrol ´s interest : 92%
Source: Ecopetrol
2013
2016
2018
2020
Ecodiesel
Bioenergy
Ecodiesel 2
Etanol
Ethanol
Bioenergy 2
Subject to further approvals
38
41. CENIT: Transport new business model
Current
Situation
New Model
“CENIT”
100% owned
by Ecopetrol
Benefits
• Growing investment in Oil & Gas in Colombia.
• Country´s rising production driven mainly by heavy crudes.
• Existing infrastructure operating at full capacity.
• High operating standards.
• Third party access to transport systems.
• Diversified funding alternatives for new infrastructure.
• Separate roles:
• Cenit: planning, commercial strategy, and management.
• Ecopetrol: operator of transport & logistics infrastructure.
• Colombian specialized company in transport & logistics.
• Access to all O&G companies, based on clear and transparent rules.
• Ecopetrol focused in other business segment and generating profit from transport.
• Cenit will guarantee Ecopetrol the required capacity for hydrocarbon transport.
41
42. Future increase in capacity in order to meet demand
Colombian demand vs. Capacity*
(mbd)
2.500
2012 – 2014:
Crude Oil Pipeline - Key Projects
2.020
2.000
1.500
1.287
988
1.377
1.446
1.472
1.
2.
3.
4.
San Fernando – Monterrey System: +390 mbod
Bicentenario Phase 1: +120 mbod
Magdalena Medio System: +75mbod
Caño Limón – Coveñas: +55 mbod
Pipeline - Key Projects
1.133
1. Galán - Sebastopol: +110 mbod*
2. Costa Norte Colombiana – Galan: +90 mbod**
1.000
Post 2014:
500
Crude Oil Pipeline - Key Projects
0
2010
2011
2012
Fuel Oil
Third parties production
Partners
Pipeline Capacity
2013
2014
2015
2016
Diluent
Royalties
Ecopetrol´s production
Total Capacity*
1.
2.
3.
4.
Carmentea (EBC) – Araguaney: +460 mbod
Bicentenario Phase II & III: +330 mbod
Pacífico Colombiano: +450 mbod
Oleoducto Coveñas – Cartagena: +300 mbod
**Projects in engineering and economic analysis. The capabilities
and build times are subject to the results of engineering.
* Includes trucks
Source: Ecopetrol
42
46. Strong financial results compares to industry peers
Financial Results Jan-Sep 2012
Peers**
Ecopetrol
Min
Max
Sales growth (US$)*
10%
-2%
5%
Operating margin
40%
8%
39%
EBITDA margin
48%
12%
57%
Net margin
25%
4%
24%
6%
12%
34%
ROA (12 months)
17%
2%
7%
ROE (12 months)
28%
4%
11%
Financial Debt / Assets
* Growth compared to Jan – Sep 2011
**Sample group includes: Petrobras, Marathon, Hess, Repsol and Oxy
Source: Companies´quarterly reports and Bloomberg
46
47. Cost saving initiatives: Lifting, refining and transport costs
Workstreams
Production
Lifting Cost
Key Initiatives
•Standardize required well workovers
•Corrective maintenance of high cost facilities (gas
plants, drilling rigs, tanks and lines)
•Outsourced water treatment
Refining
Refining cash cost
•Procurement of catalysts with refineries specs
• Standardize maintenance of critical equipment
• Minimize vapor leaks and losses in electrical lines
Transport
Transportation cost
•Improved reliability of lines and pumping systems
•Higher utilization of energy during off-peak hours
• Reduce service expenses
47
49. Strong cash flow, low indebtedness,
and investment grade ratings
Initial
Sources
25,2
Cash Flow
Jan-Sep
2012
Uses
0,6
0,1
31,0
17,6
3,2
5,1
(USD billion)
Initial Cash
Operations
Other
Offering
Cash
Available
Assets
50,2
2.3
2,6
3,1
Balance
Sheet
Sep 30/2012
(USD$ billion)
Credit Ratings
Other long term
Other short term
Labor obligations
Cash and cash equivalents
Accounts receivable
20.4
9,2
Natural and environmental
resources
Other long term
2.0
10.7
Capex
Liabilities
7.7
11.3
Operations
Inventories
1.5
Property, plant and
equipment (net)
Investments
1.9
3.1
3.2
2.4
7.6
Final
4,7
0,4
FX
Difference
Dividends
5,2
Ending cash
Debt Ratios *
• Liabilities / Assets: 0.41x
• Financial obligations /
Total Liabilities: 15.4%
Estimated liabilities
and provisions
Financial obligations
(12 month): 0.19 x
Other short term
• EBIT/ Interest expenses: 84x
Accounts payable and
related parties
• Financial obligations/ Ebitda
• Total debt / Capital: 0.11x
• Debt / 1P Resvs.: USD 2.71/bl
S&P: BBB- (Positive) / Fitch: BBB- (Stable) / Moody´s: Baa2 (Stable)
* Does not include subsidiaries
49
50. Capex plan of US$80 billion between 2012-2020 focused on
E&P, mainly funded with internal cash generation
USD 80 bn
Biof. & other
Transport
Refining
Exploration
Production
3%
5%
7%
USD 80 bn
Equity
Debt
9%
16%
25%
60%
Uses
Cash
generation
75%
Sources
• Long term crude oil price assumption for 2012-2020 Capex plan: WTI USD80/bl (real 2012)
• Required debt financing as function of crude oil price
• ROCE: 36% (2009-2011)
50
51. Capex of US$9.5 billion for 2013
Breakdown of Capex
Key goals/projects per segment
2%
Exploration
19%
18%
• 34 exploratory wells
• 26 in Colombia
• 8 International
Production
• Average Production: 798 mboed
• Ecopetrol: 750 mboed
• Subs. + Aff. : 48 mboed
Production
US$9.5
billion
Exploration
44%
Refining
Transport
18%
Other
Capex allocation:
Refining
• Modernization of B/bermeja and
C/gena facilities
• Industrial services project at B/meja
Transport
• Increase crude transportation
capacity by 170 mbod in 2013 and 250
mbod in 2015
• 69% to Ecopetrol S.A. and 31 % to Subsidiares
and Affiliates
• 95 % in Colombia
• 62% to E&P
* Source Ecopetrol
Other
• R&D
• IT
• HSE
51
53. Improving HSE (Health, Safety & Environment) metrics
Environmental Incidents
Accident frequency with labor time loss
(number of events)
(# accidents per mn labor hrs.)
2,28
116
1,56
1,22
1,24
1,02
0,85
59
56
41
41
23
2007
2008
2009
2010
2011
Jan-Sep-2012
2007
2008
2009
2010
2011
Jan-Sep-2012
• New operational model
• Full awareness within employees and contractors
• Risk management best practices
Source: Ecopetrol
53
54. Ecopetrol in the Dow Jones Sustainability Index (World DJSI)
since 2011
Ecopetrol´s 2011-2012 Corporate Sustainability Assessment
76
77
61
59
82
70
88
Environmental
EC 2011
EC 2012
78
53
51
41
Economic
74
Social
Avg O&G 2012
Total
Key facts of 2011-2012 Ecopetrol´s Assessment:
• 340 companies in the 2012 (41 added and deleted) in DJSI world index (12 in O&G)
• Among the 10% best rated O&G companies worldwide
• 2012 assesment improved vs. 2011
• One of four Colombian companies included in the index
Source: Corporate Sustainability Assessment, SAM-DJSI
54
56. Ecopetrol is fully committed to deliver on its 2020
strategic goals
Ecopetrol: a sustainable and reliable investment
• E&P sound strategy and asset base to raise production and add reserves
• Projects to improve returns in refining and deliver high quality products
• Diversified markets and increasing exports
• New business model to expand transport infrastructure and provide services
• Financial strength to fund growth and effective cost control
• High returns on investments and thorough Capex allocation
• Improving HSE performance
• Recognized CSR practices - part of DJSI (World) since 2011
• Strong Corporate Governance
56
58. SEP
ENERGY FOR THE FUTURE
Ecopetrol S.A. All rights reserved. The re production of this presentation is forbidden without the written authorization of Ecopetrol S.A.
58
58
59. Corporate Group 1P Reserves: 2008 - 2011
1P Reserves*
(million barrels of oil & gas equivalent)
193%
IRR **
RRI**
351%
46%
1,538
1,714
164%
1,857
1,137
2008
2009
2010
2011
* Estimated using SEC prices and methodology
** RRI: Reserve replacement index
Source: Ecopetrol
59
60. Main fields by region in Colombia
Region
Share
Central
26%
East
Main fields
Production*
(mboed)
18%
Castilla
Chichimene
115
38
Rubiales + Quifa
121
Northeast
21%
Guajira
Cusiana
Middle
Magdalena
16%
La Cira
Nare
22
16
Catatumbo
10%
Tibú
2
South
8%
Orito
Tello
3
5
Minor fields
1%
60
37
* EC´s production Jan-Sep of 2012
Source: Ecopetrol
61