Colombian National Oil Company Energy for the Future Ecopetrol S.A. December 2008
Non-deal roadshow management team Presenter Summary Bio Javier G. Gutirrez (57) Mr. Gutirrez has served as our President and CEO since January 22, 2007. Prior to becoming our CEO, Mr. Gutirrez served as CEO of Empresa de…
Agenda Company overview Colombia oil & gas sector framework Investment highlights Financial performance Closing remarks 3
Ecopetrol is a vertically integrated O&G company with a unique track record in the industry and is currently transforming itself into a global energy player Historical events 1905: De mares and Barco concession 1951: Ecopetrols…
EC is present in most of the subsectors of the O&G chain in Colombia and has a leading market share Portfolio highlights Direct Market Share P1: 1,499 MMBOE Total: 74% Exploration Reserves (gross) Oil: 70.1% as of Dec. 2007 Gas:…
EC is the largest company in Colombia with strong financial metrics Key financial highlights (In US bn) September 30, 2008 September 30, 2007 12,2 Revenues 7,6 6,3 EBITDA 4,0 4,4 Net Income 1,9 Source: Ecopetrol.…
Ecopetrols core strengths Favorable economic environment and strong industry framework in Colombia 1 Outstanding financial performance and Quality of asset 7 2 resources to support base and reserves growth World-class…
Agenda Company overview Colombia oil & gas sector framework Investment highlights Financial performance Closing remarks 8
The Colombian economy has experienced strong growth, Favorable economic environment and strong industry framework reflecting investor confidence and increasing foreign investment Real GDP (% change) and credit rating Credit rating…
Colombia has a very transparent and stable regulatory and institutional framework for the oil and gas sector Institutional Structure Regulatory and legal framework Favorable and stable contractual system All companies compete under…
Strong E&P metrics continue attracting key international Favorable economic environment and strong industry framework players; Ecopetrol is the preferred partner International players in Colombia Colombias total exploration activity…
Since 2003, Colombia has entered into a new Favorable economic environment and strong industry framework exploratory cycle 30.000 80 High Impact Discoveries A NEW EXPLORATORY CYCLE 70 CAO LIMON 25.000 SAN FRANCISCO 60…
Agenda Company overview Colombia oil & gas sector framework Investment highlights Financial performance Closing remarks 13
EC will invest US 60 Billion from 2008-2015 to achieve its goals 25 0,6 20 1,2 3 Internal 15 4 Organization 10 USD 2 billion 5 11,2 0 Downstream Downstream USD 20 billion Energy&Biofuels Transport New Business (Retail)…
Upstream EC is diversifying its portfolio with new opportunities abroad Local Exploration Projects International Exploration Projects Offshore Caribbean Round Tayrona GULF OF Caribbean Round MEXICO Fuerte K2 7 Blocks…
Exploratory activity has increased over the past five years Ecopetrols exploratory activity (No. of wells and Km of seismic) Ecopetrol Direct Ecopetrol Joint Venture Ecopetrol and partners seismic (Equivalent km) Quality of asset…
with significant efforts to maintain a strong reserve base Crude oil and natural gas gross reserves1 (MMBOE) 115 21 142 41 148 Quality of asset base and reserves 48 1.565 1.558 1.499 Dec. 2005 Revisions Extensions…
Ecopetrols production profile continues to show a positive trend Development wells Number of wells Wells in joint venture Wells owned and operated by Ecopetrol 433 Quality of asset base and reserves 403 283 321 205 210 125…
Ecopetrols natural gas business presents attractive opportunities due to market dynamics Natural Gas gross production (MMCFD) Quality of asset base and reserves 487 421 394 412 343 356 2003 2004 2005 2006 2007 Up to…
Ecopetrol continues improving its refining performance while meeting the local demand of oil products Utilization Barrancabermeja Cartagena Quality of asset base and reserves Utilization 300 305 296 312 310 (%) 305 77(96%)…
Ecopetrol has been able to manage operational costs below the industry average World-class operations with strong operating efficiency Finding and development costs (US/Bl) Lifting costs (US/Bl) Finding Development 13,4 7,2 6,93…
Ecopetrol is improving its environmental, safety and security indicators World-class operations with strong operating efficiency Environmental incidents Accidents Frecuency of combined accidents (per mm of worked hour) 112…
A solid foundation supports our strategy to Growth prospects and strong platform to pursue opportunities capture growth opportunities Strategy map Upstream Downstream Mainly focused on the upstream Selectively capture business…
Upstream Ecopetrols growth strategy is mainly Growth prospects and strong platform to pursue opportunities focused on the upstream business Organic and acquisition growth Upstream CAPEX (USD in million) Further development of…
Upstream Growth prospects and strong platform to pursue opportunities Investments are targeting new reserves through E&P operation Reserves Addition 2008-2012 per year 436 MMBOE International MMBOE 80 23% 100…
Ecopetrols growth strategy allows selectively Downstream Growth prospects and strong platform to pursue opportunities capture downstream opportunities, synergies and higher margins Downstream investments Significant CAPEX in new…
Upstream Downstream First class partners are part of our Growth prospects and strong platform to pursue opportunities strategy Some of our Partners: Upstream Downstream BP GLENCORE BHPBILLITON OCENSA CEPSA OLEODUCTO DE…
Recent transactions prove Ecopetrols Growth prospects and strong platform to pursue opportunities Upstream Downstream capacity to acquire assets and win concessions in a competitive environment Selected strategic transactions Gulf…
Ecopetrol has high-standards of corporate governance practices driven by an independent Board of Directors Corporate Governance Code Unilateral Statement of the principal High standards of corporate governance shareholder (The…
Experienced senior management team leading more than 6,000 employees with an average of 13 years of service Experienced management team Javier G. Gutierrez P. Core business unit President-CEO 2 years Corporate Adriana…
Creating a world class workforce to support our business strategy Strong corporate culture and developing Importance of research and development competencies for employees Experienced management team In 2006 Ecopetrol…
Agenda Company overview Colombia oil & gas sector framework Investment highlights Financial performance Closing remarks 32
Outstanding financial performance and resources to support growth Consistent revenue growth Revenues by segment (USD in millions) Transportation and other Refining Production 11.085 79.3% 9.127 8.640 7.700 5.721 6.478 6787 61%…
Outstanding financial performance and resources to support growth with improving operating margins and cash generation Costs and expenses (USD in millions) Operating Expenses Variable costs* Fixed costs 6.436 6.722 5.647 594…
Outstanding financial performance and resources to support growth and higher levels of profitability, with an attractive dividend policy Net income (USD in millions) 4.404 2.571 1.615 1.684 1.881 789 1.048 2003 2004 2005 2006…
Outstanding financial performance and resources to support growth Capacity to fund growth through optimization of the capital structure Balance sheet (USD bn) Assets Equity Liabilities Source: Ecopetrol 15,0 13,3 10,3…
Agenda Company overview Colombia oil & gas sector framework Investment highlights Financial performance Closing remarks 37
Closing remarks We are a growing vertically integrated Oil & Gas company with Excellent operating and financial track record demonstrated by (i) attractive level of production growth and reserve replacement, (ii) improved margins,…
Closing remarks (contd) We are a growing vertically integrated Oil & Gas company with Experienced management team with proven track record supported by a committed and skilled workforce Available internal and external financial…
Presentation will be available at www.ecopetrol.com.co 40
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