Ecopetrol

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Ecopetrol
Type Public
Founded 1921 as Tropical Oil Company, 1951 as Ecopetrol
Founder(s) Colombian Government
Headquarters Colombia
Key people Javier Genaro Gutiérrez Pemberty (President); Pedro Rosales Navarro (Chief Operating Officer)
Industry Oil and Gas
Products Crude Oil, LPG, Butane, Virgin Naphtha, Cracked Gasoline, Motor Gasolines, Jet Fuel, Diesel No. 2, Fuel Oil
Revenue First quarter 2008 = USD 3.96 billion
Operating income First quarter 2008 = USD 2.03 billion
Net income First quarter 2008 = USD 1.26 billion
Owner(s) Colombian Government
Employees 6,075
Website http://www.ecopetrol.com.co

Ecopetrol S.A. is the largest company in Colombia and the principal petroleum company in Colombia. It is also one of the four principal petroleum companies in Latin America and is one of the 35 largest petroleum companies in the world. Ecopetrol has oil producing field in the central, south, west and north areas of Colombia; two refineries, ports for fuel exports and imports on both the Caribbean and Pacific coasts and a transportation network of 8124 km of pipelines and polyducts throughout Colombia.[1]

Company History

The Empresa Colombiana de Petróleos, was created in 1948 by the means of Law 165. The company assumed the reverted assets of the Tropical Oil Company that had begun oil activities in 1921. Ecopetrol undertook activities in the oil chain as a State-owned industrial and commercial company in charge of administrating the nation’s hydrocarbon resources. In 1961, the company was assumed under the direct management of the Barrancabermeja Refinery, and in ’74 it was purchased by the Cartagena Refinery (which was built by Intercol in 1956). In 1983, Ecopetrol discovered the Caño Limón field in association with OXY, a reservoir of reserves estimated at 1.1billion barrels. In 1986, Colombia began to export oil again.

During the 1990s, Colombia extended its oil self-sufficiency with the discovery of the Cusiana and Cupiagua fields, in association with the British Petroleum Company. By the Colombia Degree 1760, on June 26, 2003, the organic structure of the Empresa Colombiana de Petróleos and made it Ecopetrol, S.A., a public stockholding corporation that is 100 percent state owned.[2]

In November of 2007, Ecopetrol held an initial public offering on the Colombian Stock Exchange (BVC), which raised $5.7 trillion Colombian Pesos (US$2.8 billion) from the sale of a 10.1% stake. On September 18, 2008 Ecopetrol announced the listing of its American Depositary Shares (ADSs) on the New York Stock Exchange (NYSE). Each ADS represents 20 ordinary shares of Ecopetrol common stock. The ADSs began trading that day on the NYSE under the ticker symbol "EC". JPMorgan Chase Bank, N.A. is acting as depositary for the ADS program and LaBranche & Co Inc. serves as the specialist for trading the ADSs.[3]

Historical Financial Information

In July 2008, a Latin American investment advisor, the Compass Group, stated that Colombia has a industry growth in many areas including energy, agriculture, technology, infrastructure and manufactured products. In addition to GDP growth and investment climate, Colombia has commodities growth. Ecopetrol is a major part of that commodities growth, as it has $60 billion to invest in oil development.[4]

Business Strategy

Political and Public Influence

Political Contributions

Lobbying

Corporate Accountability

Labor

Workers’ Rights, Violence and Impunity in Colombia
This document discusses the 2004 strike at Ecopetrol and the International Labour Organization’s (ILO) address to review this strike. The ILO states that the strike could not have been declared illegal on substantive and procedural grounds and that the government should respect the order of the arbitral tribunal regarding the reinstatement of the workers.[5]

Human Rights

Development, Peace and Human Rights in Colombia: A Business Agenda
This document addresses the development of the first Peace Laboratory. It mentions that the Fundación Ideas para la Paz has joined together with Ecopetrol to test the Conflict Sensitive business practice tool risk analysis and management methodology.[6]

Ecopetrol and OXY attack the village population of the Centro - Barrancabermeja, Colombia
According to Ecopetrol, they have created a National Commission and regional sub committees on Human Rights and Peace with the Unión Sindical Obrera (Worker’s Union). Their activities have trained workers in peaceful coexistence and conflict resolution, leading to an increasingly effective resolution of cases presented to the committee. In 2006, Ecopetrol completed 35 activities to promote their human rights participation. Such activities included: 10 regional workshops on human rights and peace training, 2 workshops for basic human rights training, 5 regional (and 1 national) assemblies for employees and peace workers, 1 permanent assembly of the Civil Society for peace, 13 meetings of the National Commission for Human Rights and Peace, 2 sub committee members for Human Rights and Peace training, and 1 diploma course in human rights.[7][8]

A Laboratory of War: Repression and Violence in Arauca
This document discusses Occidental’s human rights violations, including the XVIII Brigade which is reportedly funded by Oxy that has collided with paramilitary forces and alleged monetary donations to other armed forces.[9]

Cambios estructurantes para una mayor protección socioambiental
A comparison of the structural changes that occurred because of Ecopetrol.[10]

Special Issues and Campaigns: World Report 1999
Human Rights Watch claims that Ecopetrol along with Occidental Petroleum and Royal Dutch/Shell, took no action to address reports of extrajudicial executions and a massacre committed by the state forces assigned to protect the consortium’s facilities. The companies’ response was that human rights violations were the responsibility of governments, and they did not announce any programs to ensure that their security providers do not commit human rights violations.[11]

Ecopetrol and the U'Wa
In response to Ecopetrol's 2008 listing on the New York Stock Exchange, the environmental organization Amazon Watch issued a press release over concerns about Ecopetrol's inadequate commitment to corporate social responsibility and mishandling of controversial projects within indigenous reserves, specifically dealing with the U'Wa indigenous people of eastern Colombia. [12]

The group also wrote a letter to JPMorgan Chase, [13] detailing discrepancies between Ecopetrol’s current plans and activities and claims the company made in its statement to the Securities and Exchange Commission (SEC) [14] about its operations in indigenous reserves.

Contact Information

Ecopetrol S.A.
Carrera 7 No.37-65
Bogotá, D.C., Colombia
Tel: +57-1-234-4000

Articles and Resources

Sources

  1. ↑ "Leader in Colombia", Ecopetrol website, accessed July 2008.
  2. ↑ "Our history", Ecopetrol website, accessed July 2008.
  3. ↑ Ecopetrol, "Ecopetrol Lists American Depositary Shares on the New York Stock Exchange", Ecopetrol Press Release, September 18, 2008.
  4. ↑ Adria Greenberg, "Media Advisory: Experts Available - An Emerging Market Investors Shouldn't Ignore: Global Investors Looking for Alternatives Should Consider Colombia: The Next Chile, in Terms of Economic Strength and Growth New Political Stability; Positive Economic and Political Trajectory; Pro-Market Reforms; Burgeoning Stock Market and Inve", Centre Daily Times, July 8, 2008.
  5. ↑ American Feder~tion of Labor & Congress of Industrial Organizations (AFL-CIO), "Workers' Rights, Violence and Impunity in Colombia", January 9, 2008.
  6. ↑ Lucy Amis, Adrian Hodges and Neil Jeffery, "Development, Peace and Human Rights in Colombia: A Business Agenda", Prince of Wales International Business Leaders Forum, 2006. (This report was funded by the Coca-Cola Company).
  7. ↑ Ecopetrol, "Corporate Governance", Social Responsability Report 2006, accessed July 2008.
  8. ↑ "Ecopetrol and OXY attack the village population of the Centro - Barrancabermeja, Colombia", Media Release, November 20, 2007. (This media release is in Spanish)
  9. ↑ "Colombia: A Laboratory of War: Repression and Violence in Arauca", Amnesty International, 2004.
  10. ↑ "Cambios Estructurantes Para Una Mayor Proteccion Sociobiental", undated, accessed July 2008. (This is in Spanish).
  11. ↑ Human Rights Watch, "Corporations and Human Rights", World Report 1999.
  12. ↑ Amazon Watch, "Investors Urged not to Buy Ecopetrol Shares on NYSE over Human Rights Concerns", Amazon Watch Press Release, September 2008.
  13. ↑ Amazon Watch, [http://www.amazonwatch.org/newsroom/view_news.php?id=1647 "Amazon Watch to JPMorgan Chase Bank: Don't underwrite Ecopetrol"], Media Release, September 17 2008.
  14. ↑ Ecopetrol, Ecopetrol filing with the Securities and Exchange Commission, September 12, 2008.

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