Colombia Ecopetrol’s Q2 income down on higher costs, weaker oil

01 August 2013 05:57  [Source: ICIS news]

MEDELLIN, Colombia (ICIS)--Ecopetrol’s consolidated net income in the second quarter fell by 6.8% year on year amid a sharp rise in the cost of sales and a slip in the price of oil, Colombia’s state-owned energy company said on Wednesday.

Consolidated net income in the April-June period slipped to Colombian pesos (Ps) 3,407bn ($1.80bn, €1.35bn) from Ps3,657bn a year earlier, the company said in a statement.

During the same three-month period, consolidated variable and fixed costs rose by 8.7% and 13.8% year on year, respectively, and included increased tariffs on pipelines, the company said.

“Financial results were in line with our expectations and reflect the increase in production of heavy crude, the lower international prices of hydrocarbons and the expected increases in transport costs,” said Ecopetrol CEO Javier Gutierrez.

“We continued carrying out the cost control initiatives in our operations, especially well maintenance, energy consumption, procurement and refinery maintenance,” he added.

Consolidated sales revenues in the quarter stood at Ps17,595bn, up by about 6.6% from Ps16,509bn, while earnings before interest, tax, depreciation and amortisation (EBITDA) were up by about 1.3% to Ps7,516bn from Ps7,421bn, Ecopetrol said.

Sales volumes of petrochemical products increased over the quarter by 2.3% amid higher sales of national and imported polyethylene (PE), while sales of diesel and jet fuel also rose because of a spike in demand for both products.

Gasoline sales fell by 4.7% as inventories of wholesalers had been sufficient to supply the market during the quarter, while liquefied petroleum gas (LPG) and propane sales fell by 7.7% because of the arrival of other non-regulated players, the company said.

The utilisation rate at the Barrancabermeja refinery, which produces 75% of Colombia’s domestic supply of gasoline, fuel oil and diesel, rose by 84.3% from 79.0% a year earlier, while throughput was up slightly to 219,700 bbl/day from 218,100 bbl/day.

The utilisation rate at Colombia’s second refinery, Cartagena Reficar, increased to 84.3% from 70.7%, while throughput fell to 72,500 bbl/day from 73,100 bbl/day, the company said.

The modernisation project at Cartagena, which aims to increase capacity from 80,000 bbl/day to 165,000 bbl/day, was 82.5% complete by the end of June, Ecopetrol said.

($1 = Ps1,898, $1 = €0.75)

By: Simon West

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