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Ecopetrol books $1bn profit in second quarter

First half of 2019 net income rose 1.6% year-over-year

Colombia’s state-run Ecopetrol reported a net profit in the second quarter as the company recently announced its entry into the prolific Permian shale play with partner Occidental Petroleum.

The company posted net income of $1.0 billion for the second quarter, an almost 1% decrease when compared to the year-ago period. For the first half of the year, however, net profit rose by 1.6% year-over-year to $1.83 billion (6.23 trillion pesos).

Ecopetrol's recent deal with Occidental, expected to close in the fourth quarter, will see the company pay $750 million in cash and $750 million of carried capital for a 49% interest as part of a joint venture to develop 97,000 net acres in the Permian's Midland sub-basin. The company is looking to boost reserves and gain experience in unconventional development.

Occidental and Ecopetrol in joint venture

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Average daily production for Ecopetrol hit 723,000 barrels of oil equivalent per day in the second quarter as drilling campaigns in the Akacias, Rubiales, and Quifa fields continued performing well along with secondary and tertiary recovery programmes. Production at the Akacias field hit a record 20,000 boepd, Ecopetrol said.

Scheduled maintenance at the Cusiana and Cupiagua natural gas fields contributed to a lower output in the second quarter when compared to the first quarter 2019, the company said.

Ecopetrol ran 37 rigs during the quarter, six more than it operated in same period in 2018, and drilled 147 development wells. For the first half of the year, Ecopetrol has drilled 311 development wells, or 17.4% more than it completed last year.

The company also drilled six exploratory wells in the second quarter, totalling 10 overall for 2019.

Ecopetrol recently entered the Permian shale play after agreeing to a joint venture with Occidental Petroleum.

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