Ecopetrol S.A. will pay off $156 million USD in loans early, the company announced today. The loans date back to 2013 and were issued with a payment schedule that would end in 2023, but they carry no penalty for a shortened repayment time line, according to the state-controlled oil company.
Ecopetrol has planned two payments, on July 6 and 25, that will fully fulfill its debt obligations. The loans were taken out from various banks and guaranteed by the Export-Import Bank of the United States.
The company says that its “solid cash position” of 16.6 billion Colombian pesos in the first quarter of the year spurred it to make this decision about its balance sheet. Even after making the early payoff, its cash position will “remain robust,” says Ecopetrol, and still allow it to maintain flexibility even if oil prices fall lower than its projections anticipate.
“This prepayment is in line with the objectives of the company’s 2020 business plan,” the firm said in a statement, “and confirms Ecopetrol’s commitment to continue to improve its credit rating and increase shareholder returns.”
This is not the first time the oil giant has opted to clear a loan off its books early. In 2016, it made a similar move, paying off some $340 million USD that was not due until 2024.