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Copper Tip Energy

Canadian producers cut Colombian oil output as protesters block transport routes

CALGARY — Two Canadian oil and gas companies say they’ve been forced to reduce production in Colombia as protests that have resulted in 42 deaths continue in the South American country.

Both Parex Resources Inc. and Gran Tierra Energy Inc. say blockades of key transportation routes that have affected deliveries of food and other products have also forced them to temporarily shut down wells.

Parex says its net production over the past week has averaged 31,000 barrels of oil equivalent per day, down from output of 40,000 boe/d.

It says it is withdrawing its second quarter production guidance and reducing the lower end of its second half 2021 guidance to acknowledge the impact of any additional blockades.

Gran Tierra says it had stopped production of about 5,250 barrels of oil per day as of Sunday from about 29,600 bpd before the blockades began.

It says it will leave its production guidance for the year at between 28,000 and 30,000 bpd if the blockades are lifted within the next two weeks, but warned it may have to shut down more wells if the situation worsens.

“We believe our temporary production reductions are only a deferral, not a loss of oil reserves, and that the high quality and value of our low-cost and low-decline conventional oilfields remain fully intact,” said Gran Tierra CEO Gary Guidry in a news release.

The protests began April 28 after President Ivan Duque attempted to implement a tax increase amid a pandemic that has left millions without work or food.

Although he backed down, protesters have remained on the streets, broadening their fight to include grievances ranging from the state of Colombia’s health care and education systems to the slow implementation of a 2016 peace deal with Marxist rebels.

This report by The Canadian Press was first published May 18, 2021.

Companies in this story: (TSX:GTE, TSX:PXT)

The Canadian Press

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