Ecopetrol & Occidental Petroleum Extend Permian Basin Joint Venture

Colombian state-controlled petroleum company Ecopetrol S.A. (BVC: ECOPETROL; NYSE: EC) announced yesterday in a statement that its subsidiary Ecopetrol Permian LLC  and Occidental Petroleum Corp (NYSE: OXY), have reached an agreement to extend the development plan of its Rodeo Midland Basin LLC joint venture, located in the Permian Basin petroleum deposits in the US state of Texas. The joint venture was established in July of 2019.

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This agreement includes a drilling plan for 34 wells between April 2025 and June 2026, in addition to those being executed under the current development plan for the first months of 2025.

The agreement also maintains the possibility of signing a new extension of the Development Plan in the future, subject to the macroeconomic environment, industry situation, and partners’ interests. Furthermore, the two companies will keep active an independent contract for the development of the Delaware sub-basin, will remain in force until 2027.

After five years of operations, Ecopetrol Permian and Occidental have achieved positive operational and financial results in the Permian Basin, reflected in the growth of production and its contribution to the Ecopetrol Group’s results.

Ecopetrol Permian’s 2025 Plan for Midland and Delaware sub-basins will include the drilling of approximately 91 development wells, with an estimated investment of $885 million USD and an average annual production of approximately 90,000 barrels of oil equivalent per day (net to Ecopetrol Permian). This plan aligns with the Ecopetrol Group’s strategy, capital discipline, and the diversification of its portfolio.

Permian is recognized as one of the basins with the largest hydrocarbon reserves and one of the most productive in the world, with robust infrastructure for the development of oil projects.

Headline Photo credit: ARMBRUSTERBIZ / Pixabay