Ecopetrol S.A - EC STOCK NEWS

Ecopetrol S.A. has been fined COP$ 3.86 billion by Colombia's National Environmental Licensing Authority (ANLA) due to oil seepage from the Lisama 158 Well in March 2018. This decision, issued on February 9, 2021, partially reduces a previous sanction of COP$ 5.16 billion. As part of its Environmental Recovery Plan, Ecopetrol has implemented cleaning and wildlife recovery initiatives, and has invested COP$ 23.77 billion in 33 projects. The company is currently monitoring environmental quality and is considering whether to appeal ANLA's decision.

Ecopetrol confirms it has received a written communication from Colombia's Ministry of Finance regarding its bid for 51.4% of ISA's shares. Signed exclusivity contract requires Ecopetrol to finalize the bid submitted on January 27, 2021, within the first half of 2021. The Ministry reserves the right to adjust the price based on appraisal and due diligence outcomes. As Colombia's largest firm, Ecopetrol significantly influences the region's oil sector and is expanding into bio-fuels, while facing various market and regulatory conditions that could impact its future performance.

Ecopetrol S.A. (NYSE: EC) has signed a Share Purchase Agreement with De Jong Capital LLC, selling its 50% stake in Offshore International Group (OIG). This divestment comes as part of Ecopetrol's strategy to offload non-strategic assets, aiming for cash protection and sustainable growth. The sale was carried out successfully amidst competitive bidding for OIG, which includes Savia (Peru) among its subsidiaries. Accounting reclassifications have been made in accordance with IFRS 5, reflecting the transaction's completion.

Ecopetrol S.A. (NYSE: EC) announced the completion of its transaction with Shell, whereby Shell acquired a 50% stake in three Colombian Caribbean gas blocks: Fuerte Sur, Purple Angel, and COL-5. This deal, first disclosed on February 7, 2020, aims to bolster Ecopetrol's growth in reserves and production. Strengthening collaboration with Shell, a key partner in offshore development, aligns with Ecopetrol's strategic goals. The company remains a leading oil producer in Colombia and Latin America, with ongoing operations in Brazil, Peru, and the United States.

Ecopetrol's Board of Directors has approved a 2021 organic investment plan ranging from US$3.5 billion to US$4 billion. The plan focuses on restoring growth, enhancing competitiveness, and supporting energy transition and sustainability initiatives. Key allocations include 80% for Colombia, 77% for exploration and production, and significant funds for decarbonization and technology. The plan anticipates hydrocarbon production between 700,000 and 710,000 barrels per day, with a gross debt to EBITDA ratio below 2.5 times for 2021.

Ecopetrol S.A. (NYSE: EC) has maintained its long-term international rating at Baa3 with a stable outlook, as confirmed by Moody's. Despite challenges from declining oil prices and a global demand contraction due to the COVID-19 pandemic, the agency praised Ecopetrol for its solid performance and liquidity measures. The company's individual credit rating remains at ba1. Notably, Ecopetrol is Colombia's largest company and ranks among the top 40 oil companies worldwide, with operations in Colombia, Brazil, Peru, and the U.S.

Ecopetrol, Colombia's largest company, has had its credit rating affirmed by Fitch Ratings at BBB- with a negative outlook. This rating reflects the company's strategic significance and strong financial profile amid declining oil prices in 2020. Fitch commended Ecopetrol's liquidity, cash generation, and access to capital markets. The company's strong connection to the Colombian government also influenced the rating. Ecopetrol operates extensively in Colombia and has activities in Brazil, Peru, and the U.S., alongside a notable presence in the biofuel sector.

Ecopetrol S.A. (NYSE: EC) announced a settlement agreement involving its subsidiaries, Cenit and Bicentenario, with Frontera Energy Corporation to resolve disputes related to the Bicentenario and Caño Limón – Coveñas Pipelines. The settlement aims to eliminate uncertainties regarding ongoing arbitration, enhancing future business opportunities. Key terms include Frontera transferring a 43.03% interest in Bicentenario and entering new transportation contracts with Cenit. The agreement is subject to regulatory approvals by June 30, 2021. No cash payments will be exchanged, aside from a $28 million trust fund release.

Ecopetrol reported Q3 2020 financial results, showing a net income of COP 855 billion, down 71.6% from Q3 2019. Total sales declined by 31.6% year-over-year, with an EBITDA margin of 42.6%. The company cited improved market conditions and operational adjustments as factors for recovery compared to the previous quarters. Oil prices rose 30% from Q2 to Q3, positively impacting sales. The firm successfully diversified its crude oil customer base, achieving a milestone in exports. However, net income for the first nine months dropped 89% compared to 2019.