While overall infrastructure in Colombia has improved markedly in recent years, further upgrades are required to bring the countryâ€™s infrastructure up to global standards.
Colombia as a whole has many needs in terms of infrastructure, and thatâ€™s one of our big challenges.
Numerous projects are currently underway to improve the countryâ€™s network of pipelines, refineries, and ports to facilitate the growth and development of the energy sector.
Colombia possesses a 5475km network of crude pipelines, linking production areas to the main refineries and to shipping ports. Currently, the largest pipeline in the country, in both length and capacity, is the Ocensa Pipeline, which measures 829km and has a capacity of 650,000 barrels per day.
93% of the pipeline network is wholly- or partially-owned by Ecopetrol, the largest oil producer in the country and the main player in Colombiaâ€™s midstream sector. Over the last 5 years, Ecopetrol has been aggressively expanding capacity. Crude transportation capacity has risen by 27%, from 872,000 barrels per day in 2007 to over 1.1 million barrels per day in 2011.
Crude oil transport volumes have seen a 77% spike during the same 5 year period, reaching 916,000 barrels per day in 2011. Ecopetrol has budgeted capital expenditures of $3.8bn during 2011-2013 to further increase capacity. Pipeline system capacity is projected to increase a further 58% by 2015 to reach a total of over 1.7m barrels per day. The most important upcoming pipeline project is the Bicentennial Pipeline.
We are building what we call, the Bicentennial Pipeline, which will have 450,000 barrels capacity and will be built in different phases. The first phase of this pipeline will be completed at the end of this year.
The Bicentennial Pipeline, being built by Ecopetrol, Pacific Rubiales, Petrominerales, and a consortium of other international players has a projected cost of $4.2bn and, once complete, will be the longest pipeline in Colombia.
Significant investment is also being poured into the countries refineries. At present, the countryâ€™s 2 major refineries, located in Cartagena and Barrancabermeja, account for 98% of the countryâ€™s total refining capacity. Expansion and upgrading is underway at the Reficar refinery in Cartagena. The project, which comes at an estimated price tag of $4bn, will see refining capacity at the facility more than doubled to 165,000 barrels per day by the end of 2013.
An additional $3.4bn is being invested to modernize the countryâ€™s largest refinery at Barrancabermeja. The modernization, which is planned to be completed in 2016, will increase refining capacity to 250,000 barrels per day and increase the conversion factor to over 95%.
Along with the expansion of pipeline and refining capacity, port infrastructure is also set to get a boost. Currently, the primary port for oil exports is the offshore terminal at the Port of CoveÃ±as, located on the Caribbean coast. The terminal has a load capacity of 145,000 metric tons of total displacement and can pump up to 35,000 barrels per hour.
Colombia also has other port facilities, the Ports of Buenaventura and Tumaco, both located on the Atlantic coast, as well as the Caribbean ports of Santa Maria, Barranquilla, and Cartegena. It is this port at Cartegena that is set to see a significant increase in activity in the coming years. Local company Pacific Infrastructure is behind the project.
Pacific Infrastructureâ€™s main asset is the port in Cartagena called Puerto Bahia. In Puerto Bahia we expect to build over 3m barrels of storage capacity in the first phase as well as two docking positions for VLCC vessels. Weâ€™ll also develop dry goods port operations. Puerto Bahia represents a compliment port solution to the current Port of CoveÃ±as, from which 100% of Colombiaâ€™s crude oil is currently being exported.
Earth works on the Puerto Bahia site started in 2011 and phase one of the project is expected to take a total of 3 years to complete.
We expect to start operations in Puerto Bahia by the end of 2013. At that time, not only will Puerto Bahia be operational, but we will also have in place our pipeline built from CoveÃ±as to Cartagena.
While the major energy sector infrastructure projects currently underway will help address some of Colombiaâ€™s infrastructure deficit, further investment will certainly be required.
Now as one of the challenges is infrastructure, it is an opportunity, because foreign investors can come and offer good contracts in a lot of fronts of the economy. And I think there is a big opportunity there.