Colombia's state-owned oil and gas company Ecopetrol S.A. (NYSE:EC) has revealed that its operations have been negatively impacted by attacks on the Cano Limon-Covenas and Bicentenario pipelines as well as a nationwide truckers' strike. According to the company, production of hydrocarbons could be impacted in the coming days, crippling fuel supplies.
"The lacking availability of the aforementioned pipelines, due to the attacks, added to difficulty in moving tankers with hydrocarbons and liquefied petroleum gas, may impact crude oil and gas production in the coming days, as well as supplies for the Barrancabermeja and Cartagena refineries and fuels in different parts of the country," the company said in a statement on Wednesday.
Last month, Ecopetrol reported a 17% decline in second-quarter net profit, citing challenging market conditions. Ecopetrol's Q2 2024 net profit stood at 3.38 trillion pesos ($830.9 million), while first-half net profit fell 24% to 7.39 trillion pesos, versus 9.75 trillion pesos in the first six months of 2023.
"Ecopetrol faced a challenging environment, which remains impacted by various outside variables, such as the revaluation of the Colombian peso and inflationary pressures," Chief Executive Ricardo Roa said in the report.
Ecopetrol is, however, not alone, with several Latin American energy companies reporting losses: Mexico's Pemex reported a swing to a net loss of $14 billion, while Brazil's Petrobras (NYSE:PBR)reported its first quarterly loss since the third quarter of 2020.
A week ago, Ecopetrol lost two board members in the wake of the company's decision to pull out of a $3.6B deal to buy a stake in Texas shale assets from Occidental Petroleum (NYSE:OXY). According to the two members, the deal was considered "fundamental" to the company's future, and its finances will deteriorate without the resources it would have provided.
Ecopetrol shares have declined 21% in the year-to-date despite the company paying a very generous 38% dividend yield.
By Alex Kimani for Oilprice.com
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Alex Kimani is a veteran finance writer, investor, engineer and researcher for Safehaven.com. More