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Q2 2010 Earnings Call – Ecopetrol S.A.

Ecopetrol S.A. · Jul 29, 2010 · 33 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 1
    Ecopetrol S.A. FINANCIAL AND OPERATING RESULTS Second quarter of 2010 July 29, 2010
  2. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 2
    DISCLAIMER This document was prepared by Ecopetrol S.A. with the purpose of providing the market and interested parties certain financial and other information of the Company. This document may include strategy discussions and…
  3. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 3
    MANAGEMENT PARTICIPANTS IN TODAYS CONFERENCE CALL Javier Gutirrez Chief Executive Officer Mauricio Echeverry General Counsel Adriana Echeverri Chief Financial Officer Hector Castao VP of Production(A) Hector Manosalva EVP of…
  4. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 4
    AGENDA 1 Highlights for the second quarter 2010 2 Financial results for the second quarter 2010 3 Extension of the Strategic Plan to 2020 4 Outlook for the second semester 2010 4
  5. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 5
    IMPORTANT PROGRESS OF THE STRATEGY DURING THIS QUARTER: Groups produccin grew 14.5% * Production higher than expected Record production in Central region (Meta province) Diversification of exploratory portfolio 9 blocks awarded in the…
  6. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 6
    2010 CAPEX PLAN: 31% GROWTH* IN ORGANIC INVESTMENTS DURING THE FIRST SEMESTER OF 2010 Organic Investments (USD mn) Key Projects (USD mn) Project Capex Seismic 12 Tupale-1 12 Exploration Oripaya 9 1,933 Other 82 82 4%…
  7. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 7
    UPSTREAM: WE COTINUE WITH A SOLID GROWTH IN PRODUCTION Highlight s of the quarter Corporate Group Production Most competitive bids for 9 blocks in the Colombian Round (MBOED) 2010 593.9 518.5 6.4 26.2 2 Addtional commercial area…
  8. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 8
    DOWNSTREAM: WE ACHIEVED RECORD EXPORTS, WHILE EXPANDING AND UPGRADING OUR INFRASTRUCTURE Highlight of the quarter Transported volumes 98% progress in Hydro treatment project (MBD) Development of basic engineering of B/meja…
  9. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 9
    ORGANIZATIONAL CONSOLIDATION: WE ARE RANKED AS THE 1 COMPANY TO WORK IN COLOMBIA Highlights of the quarter Stakeholder meetings Ranked as the Best Company to work in Colombia by Merco firm HR 1,373 employees with organizational,…
  10. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 10
    AGENDA 1 Highlights for the second quarter 2010 2 Financial results for the second quarter 2010 3 Extension of the Strategic Plan to 2020 4 Outlook for the second semester 2010 10
  11. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 11
    STRONGER FINANCIAL RESULTS* THAN IN 2009 Total Revenue (COP tn) Costs and Expenses (COP tn) Operating Profit (COP tn) and Operating Margin (%) 8.7 9.1 8.5 37% 7.4 6.7 32% 32% 6.4 59% 5.1 5.8 5.5 4.6 9% 30% 30% 70% 2.7 3.2…
  12. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 12
    SEGMENT FINANCIAL RESULTS* 5.3 5.4 3.9 3.5 2.6 2.7 Sales 0.72 0.73 (COP Tn) E&P Refining Transportation Sales & Marketing 1Q-2010 2Q-2010 2.0 1.9 Net Income 0.2 0.1 (COP Tn) -0.2 -0.2 0.04 -0.06 E&P Refining…
  13. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 13
    FLEXIBILITY AND STRENGTH TO FINANCE GROWTH Initial Sources Uses Final 0.2 16.5 9.5 Cash Flow* Apr-Jun -5.5 8.0 6.8 -1.6 2010 -1.3 - 0.001 (COP Tn) Initial Cash Operations Others Cash available Operations Capex Dividends FX…
  14. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 14
    WE MOVE FORWARD TO THE CONSOLIDATION OF ECOPETROLS GROUP % Revenues Net Income Company Ecopetrol (COP bn) (COP bn) Highlights of the quarter Production of 34.6 MBOED Hocol 100 542 46 Hocol: Most competitive bids for 5 blocks in the…
  15. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 15
    AGENDA 1 Highlights for the second quarter 2010 2 Financial results for the second quarter 2010 3 Extension of the Strategic Plan to 2020 4 Outlook for the second semester 2010 15
  16. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 16
    MOST RELEVANT ELEMENTS IN THE INVESTMENT PLAN 2011-2020 Complementary strategic guidelines Guidelines 1. 2. Profitable growth Organizational consolidation 3. Corporate responsibility Production of 1.3 million of clean barrels…
  17. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 17
    INVESTMENT PLAN GOALS 2011-2020 ROCE Operational goal 2011 - 12 2015 2020 Avg production 2011: 750 1,000 1,300 Exploration & (MBOED) 20% Production Reserves addition 2008-12: 1,800 2008-15: 3,200 2008-20: 6,000 (MMBOE) 11%…
  18. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 18
    PRODUCTION AND RESERVES ADDITION GOALS: 2011-2020 Reserves addition Production 2007-2020 (average prod / yr) 2008-2020 Million boe xxx Year end production 6,000 Non Conv. 566 9% 1,302 Acquisitions 2,133 36% 35 16 1,000 871…
  19. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 19
    INVESTMENT PLAN SOURCES AND USES 2010-2020 0% 100% 6% 7% 0.2 80.2 7% 5.0 25% 5.5 5.5 55% 20.0 Uses 44.0 (US bn) Production Exploration Refining Petrochemicals Transport Organizational Total Consolidation 100% 62-67%…
  20. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 20
    INVESTMENT PLAN: 55% BETWEEN 2011-2015 AND 45% BETWEEN 2016-2020 100% 55% 80.2 44.3 Investment 45% 2011-2020 35.9 (US bn) Total 2011-2015 2016-2020 0% 100% 2% 9% 44.3 12% 0.7 0.1 Investment 21% 4.2 55% 5.2 2011-2015 9.5…
  21. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 21
    INVESTMENT PLAN KEY PROJECTS Start of Investment Key projects operations (USD bn) New international exploratory activity 11.5 Exploration Local portfolio Ongoing 4.2 Affiliates in Brazil, U.S. and Peru 3.8 Technology to increase…
  22. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 22
    AGENDA 1 Highlights for the second quarter 2010 2 Financial results for the second quarter 2010 3 Extension of the Strategic Plan to 2020 4 Outlook for the second semester 2010 22
  23. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 23
    OUTLOOK FOR THE SECOND SEMESTER OF 2010 Estimated average production for 2010 of aprox. 615 mboed 20 exploratory wells drilled in 2010 E&P 15 in Colombia 5 international Aprox.14,700 kms of seismeic for 2010 Hidrotreatment plant…
  24. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 24
    ENERGY FOR THE FUTURE Ecopetrol S.A. All rights reserved. The re production of this presentation is forbidden without the written authorization of Ecopetrol S.A. 24
  25. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 25
    OPERATING RESULTS* Production (MBOED) Sales (MBOED) Refinery Runs B/meja (MBOD) 553,2 559.3 738,3 514,4 542,1 713,3 708,1 488,5 632,3 656,7 99,8 99,5 94.9 17% 93,3 100,3 334,0 319,5 360,5 49% 298,6 311,4 442,3 453,7 464.4 83%…
  26. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 26
    INVESTMENT PLAN USD millones 6,925* 6,305 387 735 Acquisitions Organizational consolidation 4,824 2,363 1294 Transport Refining and Petrochemical 1,238 Production 151 Exploration 103 613 571 517 435 3,558 1,760…
  27. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 27
    PRODUCTION Thousand barrels of oil equivalent per day (MBOED) 593.9 586.4 7,6 6,4 26,2 2 521 26 6 15 552,9 559.3 500 447 376 385 399 2005 2006 2007 2008 2009 1Q-2010 2Q-2010 k2 Savia Hocol Ecopetrol 27
  28. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 28
    EXPLORATION Seismic equivalent kilometers 9,201 6,789 5,589 4,584 4,654 2,668 3,081 2005 2006 2007 2008 2009 1Q-2010 2Q-2010 28
  29. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 29
    RESERVES BALANCE MBOE CORPORATE GROUP SEC AFTER ROYALTIES IRR: 98% 65% 46% 351% 29
  30. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 30
    ACCIDENT RATE Rate of accidents ( of accidents / million of man - hours) 5,8 2,6 1,8 1,7 1,3 1.5 1,2 2005 2006 2007 2008 2009 1Q-2010 2Q-2010 30
  31. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 31
    RETURNS ON ASSETS AND EQUITY 24% 21% 20% 18% 12% 12% 15% Return on Assets 9% 10% 9% 8% 7% 9% 11% 10% 13% (ROA) 9% 9% 40% 39% 37% 34% 26% 26% 28% 22% 22% 24% 23% Return on Equity 16% 18% 17% 16% 16% 23% 19%…
  32. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 32
    OPERATING COSTS Lifting cost(USD/BOE) 7,2 8,3 7,2 7,2 5,2 5,8 2006 2007 2008 2009 2T2009 2T2010 Refining cost (USD/Bl) Transportation Cost (cents US /Bl-km)* 0,43 0,30 5,8 6,0 0,40 0,37 0,41 4,5 5,5 0,35 5,3…
  33. Q2 2010 Earnings Call – Ecopetrol S.A. – slide 33
    OUR SALES VOLUME HAS INCREASED Local sales Exports Sales 2010-2Q (mboed) 739 650 Crude 475 547 Total sales 302 361 148 216 251 (mboed) Natural gas 327 331 348 378 739 385 2007 2008 2009 2010-2Q 102 Products Crude Products…

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