Colombian President Gustavo Petro has directed the state-run oil company Ecopetrol to terminate a joint venture with a U.S.-owned company due to environmental concerns. The venture, expected to yield approximately 90,000 barrels of oil per day, involved the controversial practice of fracking.
President Petro, in a televised address, expressed his opposition to the extension of the deal between Ecopetrol and Occidental Petroleum (Oxy) citing the detrimental impact of fracking on the environment. He emphasized his stance against fracking, labeling it as destructive to nature and humanity.
Ecopetrol had recently announced plans to renew its collaboration with Oxy in the Permian basin, a significant oil-producing region spanning Texas and New Mexico. The project aimed to develop 91 oil wells with an investment exceeding $880 million.
Operations in the Permian basin contributed an average of 95,200 barrels of oil per day to Ecopetrol's production in the first nine months of the previous year, constituting around 12% of the company's total output.
Following the announcement of the partnership with Occidental, Ecopetrol's shares experienced a 2% increase. However, the stock value dipped slightly subsequent to President Petro's directive to cancel the agreement.
Colombia has maintained its stance against fracking projects within its borders, with this move marking the first instance of blocking Ecopetrol's involvement in fracking ventures abroad. Environmental activists have long criticized fracking for its potential to contaminate water sources and trigger seismic activity.
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