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HEAVY OIL AND MATURE OIL

FIELDS DEVELOPMENT IN
COLOMBIA
Gabriel Osorio
Production Vicepresident

Global Petroleum Show, Calgary, Canada, Jun11th, 2008

DISCLAIMER
This document was prepared by Ecopetrol S.A. with the purpose of providing certain information of the
Company.
This document may include strategy discussions and forward-looking statements regarding the
probable development of Ecopetrols 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.

XVII ANNUAL
LATIN AMERICAN
CONFERENCE
HEAVY
OIL PROJECTS
IN ENERGY
COLOMBIA

Agenda

1. INTRODUCTION
2. HEAVY OIL PROJECTS

Production
Exploration
Downstream
Achievements

3. MATURE FIELDS

XVII ANNUAL
LATIN AMERICAN
CONFERENCE
HEAVY
OIL PROJECTS
IN ENERGY
COLOMBIA

Development Strategies
Field Cases
Technology Opportunities
3

Agenda

1. INTRODUCTION
2. HEAVY OIL PROJECTS

Production
Exploration
Downstream
Achievements

3. MATURE FIELDS

XVII ANNUAL
LATIN AMERICAN
CONFERENCE
HEAVY
OIL PROJECTS
IN ENERGY
COLOMBIA

Development Strategies
Field Cases
Technology Opportunities
4

Ecopetrol is the main petroleum company in Colombia, 4th


in Latin-America and 39th in the PIW ranking

Marketing

Transportation
Production

Refining

Pipeline network
659 MBOEPD
Reserves P1
2021MMBOE

Crude: 531 MBPD

products:

Gas: 128 MBOEPD Cartagena: 80 MBPD

8.850 Km

ECOPETROL DIRECT
SHARE

250 MBPD

Crude: 327
MBPD Gas: 72
MBOEPD

XVII ANNUAL LATIN AMERICAN ENERGY CONFERENCE

72%
72%

for crude oil and

Barranca: 250 MBPD

399MBOEPD

P1: 1456 MMBOE


P2: 1801 MMBOE

330 MBPD

62%
62% 56%
56%

8.407 Km

601 MBDP
Local Sales: 293MBDP
Exports :

309 MBDP

Nal: 262
MBPD

Exp: 148
MBDP

76%
76%

79%
79%

48%
89%
48% 89%

Source: Ecopetrol

COLOMBIA

Exploration

UPSTREAM TARGETS 2008 2015


Increase reserves and production of oil and gas

Annual average growth of production =


12%

1 MBPED
132

550 KBPED
462
KBPED

41
61

399

448

2007

2011

406

2015

OIL PRODUCTION GROWTH LEVERAGED ON DIRECT OPERATION

311

306

292

5%

2%

316

2%

347

327

4%

TP
A=

Thousand barrels per day

4%
te (AGR)=
a
R
th
w
o
r
Average G

12
%

448

6%

Fuente: Ecopetrol

Agenda

1. INTRODUCTION
2. HEAVY OIL PROJECTS

Production
Exploration
Downstream
Achievements

3. MATURE FIELDS

XVII ANNUAL
LATIN AMERICAN
CONFERENCE
HEAVY
OIL PROJECTS
IN ENERGY
COLOMBIA

Development Strategies
Field Cases
Technology Opportunities
8

HEAVY OIL PRODUCTION

Nare Teca fields

Bogot

Rubiales field

Source: Ecopetrol

Castilla field
San Fernando Formation

Heavy oil production represents over 20% of the


Ecopetrols total production

We have doubled heavy oil production in the past 4 years

MBOPD

April 2008 , 100,6 MBOPD , 72,4 Castilla San Fernando


17,6 Rubiales, 10,6 Nare - Teca

69

30
0
3

30

30

0
4

0
4

36
0
6

29

82

18

15

11

0
9

11
9

52

60

62

2005

2006

2007

0
8

0
8

28

27

26

30

38

2000

2001

2002

2003

2004

Castilla - San Fernando

XVII ANNUAL
LATIN AMERICAN
CONFERENCE
HEAVY
OIL PROJECTS
IN ENERGY
COLOMBIA

100

60

46

Nare

128

72

84

2008 2011
Goal
Rubiales

Fuente: Ecopetrol S.A.

10

EXPLORATION ACTIVITIES IN THE LLANOS BASIN

XVII ANNUAL
LATIN AMERICAN
CONFERENCE
HEAVY
OIL PROJECTS
IN ENERGY
COLOMBIA

PROJECTS DOWNSTREAM
SEA
CARIBBEAN

CARTAGENA

Barranca Refinery Modernization


Upgrade Heavy oil

COVEAS

Tib

PANAMA
Tocancipa Castilla pipeline

GCB
CIB

Cao Limn

Cupiagua

PACIFIC

Cusiana

OCEAN
Rubiales Porvenir
pipeline

Apiay

ApiayPorvenir
pipeline
Tumaco

Orito

BRAZIL

ECUADOR
A Lago Agrio

PERU

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COLOMBIA

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Integrated Project Strategy


Diluted Heavy Oil Production Scheme : (2008 2012)
Dilution
DILUENT
(NAPHTHA GCB/IMPORT)

DILUTED CRUDE
18
18API

Market

CASTILLA/S. FERNANDO/RUBIALES
AND TECA NARE HEAVY CRUDE PRODUCTION

LOCAL
REFINERY

Production-Enhancement Integrated Scheme : (2013 2033)


DILUENT
(RECYCLED NAPHTHA)

REFINERY
PRODUCTS

Market
CASTILLA/S. FERNANDO/RUBIALES
AND TECA NARE HEAVY CRUDE
PRODUCTION

DILUTED CRUDE

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OIL PROJECTS
COLOMBIA

BARRANCA REFINERY
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SUBPRODUCTS
(COKE / SULPHUR)

13

HEAVY OIL PROJECTS.


Total Investment of 5752 MMUS$
Preliminary portfolio information for the next five years
Upstream

Exploration

Production

2722
50

Castilla....

1050

San Fernando...

1080

Rubiales

400

Nare Project (Jazmin, Girasol & Other Field)

142

Downstream. 3030

Pipelines

650

Refining.

2380

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COLOMBIA

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Achievements in heavy oil projects


Upstream
High potential exploratory blocks, close to the infrastructure of the producing fields.
We have doubled the production levels of heavy oil in the past 4 years
Good production results based on design of horizontal and multilateral wells.
High possibilities to increase in both, the reserve base and production levels of
heavy oils

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OIL PROJECTS
COLOMBIA

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Achievements in heavy crude project


Downstream
Having an alternative for transportation of heavy oil through raw naphtha dilution,
optimizing the existing pipeline infrastructure.
Optimizing the feed to the Barrancabermeja refinery through the crude segregation
program
Positioning a new blend in the international market: the Castilla blend.

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COLOMBIA

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Agenda

1. INTRODUCTION
2. HEAVY OIL PROJECTS

Production
Exploration
Downstream
Achievements

3. MATURE FIELDS

HEAVY OIL PROJECTS IN COLOMBIA

Development Strategies
Field Cases
Technology Opportunities
17

INTRODUCTIONMature Fields have a significant potential


The
The recovery
recovery
factor
factor is
is << 20%
20% in
in
Mature
Fields
Mature Fields
OOIP : 26,8 Billion barrels

Total: 200 KBOPD


12%

48%

25%

Age of Field
>30 years

11%

37%

23%
18%

Original oil in Situ

20-30 years
10-20 years

26%

Daily production

<10 years

DEVELOPMENT STRATEGIES
Ecopetrol has worked on three strategies to increase recovery in these fields

Contract extension through economic life

Guajira (56,2 KBPDE), Cravo Norte(42 KBPDE), Las Monas (0,9 KBPDE), ,
Casanare (2,5 KBPD),

Strategic alliances in Mature Fields

La Cira Partnership with Occidental


Casabe - Partnership with Schlumberger
Tib Partnership with Petrobras

Increased investment in mature fields

MUS $

Capital Investment in fields 100 % Ecopetrol S.A.


1123
773
174

287

419

2004

2005

2006

2007

2008

FIELD CASES
Cravo Norte

Cao Limn Field- Contract Extension with OXY

Extension signed in 2004. Investment estimated in 260 MUS $ with 140 MBls Incremental
Reserves
Basis for the extension:

Ecopetrol s share from 50 % to 55 % in the year 2008, plus additional


participation due to high prices.

Initial Investment: 94 Million US $ in favor of Ecopetrol 2004 2007.


In 2004 -2007, 40 wells
were
drilled
and 35 are projected for 2008.
CRAVO
NORTE
EXTENSION
Oil Production (kbpd)
120

120.0

KBPPD

100.0

100

Incremental
Produccin Bsica

80.0

80

Proyeccin de negocio

60.0

60

40.0

40

20.0

20
0

0.0
2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

FIELD CASES
La Cira Field- Cooperation Contract ECP- OXY
Project Basis:
Execution of pilot projects for enhanced recovery.
Includes application of secondary and enhanced recovery, Infill drilling, workover and maintenance,
optimized production, exploratory seismic, exploratory wells.
INCORPORATION OF RESERVES
150 - 300 Mbls

INVESTMENT 583 MUS$

3500
MBLS

OOIP

745

PRODUCTION

830
85

REMANENTS WITHOUT PROJECT

150-300
PROJECT
OBJECTIVE
308
FR 22% 28-30%

FIELD CASES
Casabe Project Strategic Alliance ECP-Schlumberger

1331

OOIP

298

Oil produced

339
41

Reserves with no incremental project

57
PROJECT
OBJECTIVE
308
FR 23% 25%

Well replacement
Application of new technologies.
Review of water contacts.
Optimization of workover frequency.
Optimize production through reservoir integrated management.
Optimize water injection.

TECHNOLOGY OPPORTUNITIES

Reservoir characterization
Horizontal, radial and multilateral wells
Enhanced Oil

Recovery
62

Water Injection Optimization

16

Others ???

34

KBOPD

27
13

13

Includes ECP Royalties


Source: Pronet

21

19

16

24

12

13
10
8

2003

2004

2005

2006

2007

LA CIRA-INFANTAS

33

11

CASABE

Meta 2008
YARIGUI-CANTAGALLO

Meta 2011

Machado y Molina Asociados 2008

Para uso restringido en Ecopetrol. Todos los derechos reservados. Ninguna parte de esta presentacin puede ser reproducida
o utilizada en ninguna forma o por ningn medio sin permiso explcito de Ecopetrol.

MEGA 2008 2015 UPSTREAM


Produce 1 MBPED in 2015

DOWNSTREAM PROJECTS
Refinery
The project to modernize the Barrancabermeja refinery includes Delayed
Coker and Hydrocraker.
Estimated investment to date 2380 MMUS$.
Estimated date for operation start-up: December 2012

Potential Diluent
Barrancabermeja Master Plan

Heavy Crude
Oils

Diluted Crude Oils


CGB
Coker + HC

Refined Product
Sales

Diluent

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HEAVY
OIL PROJECTS
COLOMBIA

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Heavy crude project transport system


Pozos
Colorados

COVEAS
Cabotaje Nafta CoveasPozos Colorados

24
/3
0

20,16,14,12 x 315 Km

Ayacucho
x

12x 187 Km
48
2

8x 187 Km

CIB

Km

12, 12 y 16x 111 Km

Sebastopol

VASCONIA

3036x
828
Km

PORVENIR

16 y 20x 257 Km

Tocancip

EXISTING

20x 128 Km

24x 235 Km

NEW

12x 180 Km

APIAY

DILUTED CRUDE
DILUENT

CASTILLA
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OIL PROJECTS
COLOMBIA

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RUBIALES

27

DOWNSTREAM PROJECTS
Apiay Porvenir Pipeline
Length: 128 Km
Diameter: 20
Capacity: 160.000 BOPD
Apiay operation start-up: December 30, 2008
Rubiales Monterrey Pipeline
Length: 234 Km
Diameter: 24
Capacity: 160.000 BOPD
Operation start-up : November 1, 2009
Tocancipa Castilla Multi-product Pipeline
Length: 170 Km
Diameter12
Capacity: 100.000 BOPD
Operation start-up : September 30, 2009

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OIL PROJECTS
COLOMBIA

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EXPLORATION PROJECTS LLANOS BASIN

CAO SUR BLOCK


Association: Ecopetrol 50% - Shell E & P 50%
Area : 654.000 Hectares
Activity 2008:
Acquisition of 720 Kms 2D seismic in years 2007 and 2008.
Hadas 1 Well
QUIFA BLOCK
Association: Ecopetrol 30% - Metapetroleum 70%
Area: 152,000 Hectares
Activity 2008:
Acquisition of 200 Kms of 2D seismic.
Drilling of 1 well

XVII ANNUAL
LATIN AMERICAN
CONFERENCE
HEAVY
OIL PROJECTS
IN ENERGY
COLOMBIA

HEAVY OIL ROUND IN COLOMBIA


AGENCIA NACIONAL DE HIDROCARBUROS - ANH
EAST ZONE
Date for submitting
Proposals:
June 10, 2008
No. of Blocks: 8
Extension:
12.325.546 (Ha)

For additional information


consult: www.anh.gov.co
Fuente: Agencia Nacional de Hidrocarburos Colombia
XVII ANNUAL
LATIN AMERICAN
CONFERENCE
HEAVY
OIL PROJECTS
IN ENERGY
COLOMBIA

HEAVY OIL ROUND IN COLOMBIA


AGENCIA NACIONAL DE HIDROCARBUROS - ANH
WEST ZONE
Date for submitting
Proposals:
September 5, 2008
No. of Blocks: 17
Extension:
2,962.210 (Hectares)

For additional information


consult: www.anh.gov.co
XVII ANNUAL
LATIN AMERICAN
CONFERENCE
HEAVY
OIL PROJECTS
IN ENERGY
COLOMBIA

Fuente: Agencia Nacional de Hidrocarburos Colombia

DISCLOSURE
This document was prepared by Ecopetrol S.A. with the purpose of providing certain information of the
Company.
This document may include strategy discussions and forward-looking statements regarding the
probable development of Ecopetrols 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.

XVII ANNUAL
LATIN AMERICAN
CONFERENCE
HEAVY
OIL PROJECTS
IN ENERGY
COLOMBIA

32

Heavy crude production represents over 20%


of the Companys total production

MBOEPD

1 MMBOEPD

HEAVY OIL PROJECTS IN COLOMBIA

550 MBOEPD

33

HEAVY OIL PRODUCTION ECOPETROL OPERATION

BOGOTA

50 Kms

VILLAVICENCIO
Libertad

Rubiales
Rubiales

Puerto Lpez
Apiay

Suria
Acacias

Chichimene field

Guamal

Castilla field
Granada

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COLOMBIA

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PRODUCTION PROJECTS LLANOS BASIN


DIRECT OPERATION OF ECOPETROL
Castilla Field Formations K1-K2
Production of 70 MBOPD OF 11-13 API
Drilling of 117 horizontal, vertical, and multilateral wells.
San Fernando T2 Formation
Present in the Castilla, Chichimene, Apiay, Suria, Libertad fields.
Production of extra heavy crude 7- 8 API.
Estimated production 20 KBOPD for the year 2012, with future increase as per
results of tests performed in 2008.
Evaluation of new deasphalted oil technology (ECOPETROL technology) for pilot
plant with 10 KBOPD capacity.

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PRODUCTION PROJECTS - LLANOS BASIN

Associated Operation : Ecopetrol 57%; Petrorubiales 43%


Rubiales Field
Estimated production for the end of 2008 is 50 MBOPD, 12 API
In 2008, 45 wells will be drilled and new treatment facilities will be
built, with total investment of 400 MMUS$.

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PRODUCTION PROJECT MIDDLE MAGDALENA VALLEY

PRODUCTION PROJECT MIDDLE MAGDALENA VALLEY


Associated Operation: Ecopetrol 50%; Mansarovar 50%.

Teca Nare Contracts


Cocorna, Nare, Under River, Moriche, Girasol and Jazmin fields,
producing 11 - 12 API crude, with steam cyclic stimulation.
Estimated production in the year 2012 will amount to 30 MBOPD
and it may increase depending on the results of adjacent
exploration areas.
500 shallow wells will be drilled between years 2008 and 2010 .

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