Ecopetrol S.A. (NYSE: EC, BVC: ECOPETROL) reported first-quarter 2026 consolidated revenues of 28.6 trillion COP, a decline of 8.7% from 31.4 trillion COP in the year-earlier period, as lower crude oil prices and reduced hydrocarbon production compressed the top line for Colombia’s state-controlled oil and gas company. Against that backdrop, a marked recovery in refining margins and disciplined cost management lifted EBITDA by 1.5% to 13.5 trillion COP, yielding a 47% EBITDA margin and partially offsetting the revenue headwind. At the Q1 2026 average exchange rate of approximately 3,700 COP per USD, the quarter’s revenues translate to roughly $7.73 billion USD and EBITDA to approximately $3.65 billion USD.

Embattled Ecopetrol CEO Ricardo Roa was appointed to the position by Colombian President Gustavo Petro after managing his political campaign. (photo: Ecopetrol)

Net income for the quarter reached 2.9 trillion COP (approximately $784 million USD), down 7.7% year-over-year, reflecting the combined drag of lower revenues, a sharply elevated effective tax rate of 37.1%, and a one-time charge of 1.2 trillion COP for the impuesto al patrimonio — Colombia’s government-mandated wealth levy on large corporations established to fund post-disaster reconstruction measures. The company is also subject to a 10% income tax surcharge applicable for fiscal year 2026, which is embedded in the reported effective rate. The aggregate tax burden absorbed a disproportionate share of operating improvement relative to prior periods, limiting the flow-through of refining gains to the net income line.

Total hydrocarbon production averaged 725.2 thousand barrels of oil equivalent per day (kboed) in Q1 2026, below the 745 kboed recorded in the 2025 annual average cited by management during the March 2026 general shareholders’ meeting. Domestic crude output represented the largest component at approximately 520 thousand barrels per day (kbd). Ecopetrol’s Permian Basin operations in the United States contributed 91.8 kbd, underscoring the continued strategic importance of the international segment. Gas production continued a multi-year declining trend that poses a medium-term domestic supply challenge; management has sought to address this partially through regasification capacity additions at Puerto Bahía and on the Pacific coast, expected to come online in the second half of 2026 with a combined contribution of up to 430 billion BTU per day.

The refining segment delivered the quarter’s most pronounced operational outperformance. Ecopetrol’s domestic refineries, led by Refinería de Cartagena, processed 417.5 kbd of crude throughput. The integrated refining margin rose to $17.3 USD per barrel, a 60% improvement over the same quarter of 2025, driven by favorable differential pricing between domestic crude benchmarks and refined product values alongside ongoing operational efficiency improvements. The Comisión de Regulación de Energía y Gas (CREG) and the Ministerio de Minas y Energía remain central to the regulatory framework governing downstream margins over the medium term.

The balance sheet carries significant structural and contingent risk items of direct relevance to institutional credit and equity holders. Gross debt stood at 108.1 trillion COP (approximately $29.2 billion USD), representing a leverage ratio of 2.3 times trailing EBITDA — a level that leaves limited room for further deterioration before debt covenants or rating agency thresholds become binding. Ecopetrol holds a receivable of 4.2 trillion COP (approximately $1.14 billion USD) from the Fondo de Estabilización de Precios de los Combustibles (FEPC), a government fuel price stabilization mechanism that represents a claim on the Colombian treasury with timing and recovery risk. A dispute with the Dirección de Impuestos y Aduanas Nacionales (DIAN) over value-added tax assessments totals 12.26 trillion COP (approximately $3.31 billion USD) in aggregate, of which 10.22 trillion COP relates to Ecopetrol’s consolidated operations and 2.04 trillion COP to Refinería de Cartagena. Both cases are under administrative and judicial review; no provisions have been recognized in the financial statements pending resolution, but the potential liability represents a material contingency relative to the company’s quarterly net income.

On the corporate development front, Ecopetrol disclosed three significant transactions during or following the quarter. The company agreed to acquire producing assets from Gran Tierra Energy (NYSE: GTE, TSX: GTE) for $92.4 million USD, adding Colombian upstream production inventory in basins where both companies have operated. In Brazil, Ecopetrol launched a tender offer for shares of Brava Energia (BVMF: BRAV3) at 23 BRL per share, seeking to expand its footprint in that country’s oil and gas sector. And in a transaction that would reshape the mid-size independent landscape in Colombia, the company reached an agreement to acquire Parex Resources (TSX: PXT) for $250 million USD; Parex is a Colombia-focused producer with a complementary asset base across the Llanos and other producing basins. Collectively, the three transactions signal that Ecopetrol’s capital allocation strategy under the current government continues to favor upstream consolidation despite the elevated leverage profile.

The exploration portfolio generated positive news announcements. The Copoazú-1 exploratory well, drilled in Colombia’s Llanos foothills region, was confirmed as a commercial discovery, adding to the domestic reserve base. The Sirius offshore project advanced through the Consulta Previa process — a legally mandated prior consultation with indigenous and Afro-Colombian communities required before development of projects in or near their territories — reaching a milestone in community engagement that brings the project closer to formal development sanction. The Agencia Nacional de Hidrocarburos (ANH) oversees the licensing framework within which both projects operate.

“Ecopetrol is listed on the New York Stock Exchange; we are governed by the strict regulations of US federal agencies. Agencies like OFAC and the SEC could intervene in the company and could even accelerate the payment of financial obligations, which would be extremely grave for Ecopetrol.” — Martín Ravelo, President, Unión Sindical Obrera (USO)

The ISA transmission segment, managed through Ecopetrol’s majority stake in ISA — Interconexión Eléctrica S.A., contributed stable regulated cash flows during the quarter. ISA completed 46 transmission reinforcement works across its Latin American concession portfolio. The segment also completed the acquisition of 100% of IE Madeira in Brazil, consolidating its position in that country’s power grid interconnection infrastructure. ISA further submitted a competitive bid for the Río Bueno–Puerto Montt high-voltage transmission line concession in Chile, demonstrating the group’s appetite for long-duration, inflation-linked infrastructure assets across the Andes region. For institutional investors evaluating Ecopetrol as a blended hydrocarbons-and-infrastructure holding, ISA’s consistent cash generation provides partial diversification from crude price volatility, though it does not insulate the consolidated entity from headline governance risk.

The most consequential variable for the investment thesis over the near term is Ecopetrol’s prolonged governance crisis. At the company’s general shareholders’ meeting on March 27, 2026, held at the Corferias convention center in Bogotá, minority shareholders loudly heckled president Ricardo Roa — with audible shouts of “¡Fuera, fuera!” reverberating through the hall — as debate over his leadership erupted into open confrontation. The meeting approved a dividend of 121 COP per share for minority holders and a 4 trillion COP distribution to the Colombian government as majority shareholder, payable in two installments by June 30, 2026. Despite the financial business conducted, governance overshadowed the proceedings.

Roa faces two separate judicial proceedings. The Fiscalía General de la Nación formally charged him in connection with alleged influence peddling related to the purchase of an apartment in northern Bogotá — charges he has denied. Separately, the Consejo Nacional Electoral (CNE) is examining whether campaign spending limits were violated during President Gustavo Petro’s 2022 presidential campaign, which Roa managed — an investigation that Finance Colombia has covered in detail. Angela Maria Robledo, Chair of the Board of Directors, defended the board’s decision to retain Roa at the March assembly, citing the constitutional presumption of innocence. However, four of the nine board members had already formally recorded their support for his removal at that point, exposing a divided governance structure at a time when strategic and operational decisions require unified leadership.

The Unión Sindical Obrera (USO), which represents approximately one-third of Ecopetrol’s workforce, issued a production strike ultimatum timed to a March 30 board meeting. Martín Ravelo, president of the USO, framed the leadership crisis explicitly in terms of US regulatory risk: “Ecopetrol is listed on the New York Stock Exchange; we are governed by the strict regulations of US federal agencies. Agencies like OFAC and the SEC could intervene in the company and could even accelerate the payment of financial obligations, which would be extremely grave for Ecopetrol.” Ravelo further warned that the company’s outstanding international debt — which he placed at approximately $30 billion USD and which is exacerbated by elevated interest rates — left Ecopetrol exposed to potential covenant triggers or early repayment demands in a scenario where the Securities and Exchange Commission (SEC) or the Office of Foreign Assets Control were to take enforcement action.

Following sustained pressure from the USO, minority shareholders, and opposition political figures, Ecopetrol’s board approved an extended leave of absence for Roa beginning April 7, 2026. Under the arrangement, Roa used accrued vacation through May 27, followed by 30 calendar days of unpaid leave beginning May 28, extending his absence through the end of June — a period encompassing Colombia’s presidential first round on May 31 and a potential runoff on June 21. Juan Carlos Hurtado Parra, the company’s executive vice president of hydrocarbons and designated first alternate to the presidency since November 2025, was appointed acting president. Hurtado Parra holds an MBA in International Oil and Gas and brings more than 28 years of energy sector experience to the acting role, having previously served as vice president of exploration, development, and production.

The political calendar creates a structural transition risk that sits above the operational and financial results as the primary concern for long-duration investors. Colombia’s incoming government, to be inaugurated August 7, 2026, is widely expected to appoint a new Ecopetrol board and select a new company president. That transition may bring material shifts in strategic priorities — including the pace of upstream investment, the approach to the FEPC receivable recovery, the trajectory of energy transition spending, and the capital allocation balance between the hydrocarbons segment and the ISA infrastructure platform. The Ministerio de Hacienda y Crédito Público and the Ministerio de Minas y Energía will both play key roles in establishing the post-election policy framework under which Ecopetrol operates. Institutional investors holding exposure to Ecopetrol via NYSE: EC or BVC: ECOPETROL must weigh Q1’s genuine operational improvement — most visibly in refining margins and EBITDA stability — against a governance and policy transition risk profile that is unlikely to be resolved before the August handover.

Ecopetrol’s Cartagena refinery (photo courtesy Ecopetrol)

Tecnoglass, Inc. (NYSE: TGLS) reported first-quarter 2026 revenue of $249.0 million USD, a 12.0% year-over-year increase and a first-quarter record for the Barranquilla, Colombia-based window and architectural glass manufacturer. Despite the top-line growth, net income fell to $31.9 million USD, or $0.71 per diluted share, from $42.2 million USD, or $0.90 per diluted share, in the same period of 2025, as elevated US aluminum costs linked to import tariffs, mandatory minimum wage increases in Colombia, and a strengthening Colombian peso combined to compress gross margins by 540 basis points to 38.5%.

Multi-family and commercial revenues rose 20.4% year-over-year, driven by continued activity across key markets including geographies beyond Florida, which has historically dominated the company’s US revenue mix. Single-family residential revenues were relatively flat on a year-over-year basis, with management attributing the result to the timing of order conversion into revenue rather than underlying demand, noting that order growth in the segment remained positive into April 2026. On a geographic basis, the US accounted for $237.1 million USD, or approximately 95% of total revenues, up 11.6%. Colombia generated $7.5 million USD, up 17.2%, and other international markets contributed $4.4 million USD, up 27.3%.

Gross profit declined to $95.8 million USD from $97.5 million USD in Q1 2025 despite the higher revenue base. The company cited an unfavorable revenue mix driven by a greater proportion of installation-related revenue, higher raw material costs — with US aluminum tariffs representing an incremental headwind of approximately $6.4 million USD in the quarter — higher salary expenses resulting from annual minimum wage adjustments in Colombia, and the effect of a stronger Colombian peso on costs incurred locally. Pricing actions and operating leverage on higher volume partly offset these pressures.

“We see a clear path to fully offsetting the impact of tariffs in 2027, when full-year pricing across both businesses and incremental automation savings are expected to be realized.” — Santiago Giraldo, Chief Financial Officer, Tecnoglass

Selling, general, and administrative expenses rose to $50.9 million USD, or 20.4% of revenues, from $42.5 million USD, or 19.1%, in Q1 2025. The increase reflected higher personnel costs from annual salary adjustments, peso appreciation, and higher transportation and commission costs tied to revenue growth. The period also included a one-time charge of $2.9 million USD related to Colombia’s *impuesto al patrimonio*, a government-imposed wealth tax levied on large corporations to fund measures addressing recent climate-related events in the country.

Adjusted EBITDA — which excludes non-cash foreign exchange gains and losses, the bad-debt provision, non-recurring charges, and equity-method adjustments related to the company’s joint venture in Vidrio Andino with Saint-Gobain (EPA: SGO) — came in at $61.5 million USD, or 24.7% of total revenues, compared to $70.2 million USD, or 31.6%, in Q1 2025. Adjusted net income was $34.6 million USD, or $0.78 per diluted share, versus $43.1 million USD, or $0.92, in the prior-year quarter.

Cash provided by operating activities was $6.7 million USD, a significant decline from $46.9 million USD in Q1 2025, driven in part by a deliberate build-up of US-sourced aluminum inventories — up $34.3 million USD in the quarter — as part of the company’s tariff mitigation strategy. Capital expenditures of $17.3 million USD reflected scheduled payments tied to previously announced capacity and automation projects. During the quarter, Tecnoglass returned $16.5 million USD to shareholders through share repurchases and paid $6.7 million USD in cash dividends. As of May 7, 2026, approximately $92.5 million USD remained available under the current share repurchase program. The company ended the quarter with total liquidity of approximately $425.0 million USD, comprising $91.1 million USD in cash and cash equivalents and more than $330.0 million USD in revolving credit facility availability, against total debt of $200.3 million USD.

The company’s order backlog reached a record $1.36 billion USD at quarter-end, up 19.1% year-over-year, extending multi-family and commercial pipeline visibility into 2027. Tecnoglass cited continued expansion of its dealer network and showroom footprint as supporting geographic diversification and market share gains, with vinyl product lines identified as an incremental growth driver broadening the company’s addressable market.

José Manuel Daes, chief executive officer, commented on the results: “First quarter results were in line with our expectations, with resilient performance across our key metrics reflecting the continued strength of our vertically integrated business model despite a dynamic cost environment. Demand for our product offerings remains strong, as demonstrated by another quarter of record backlog and healthy order activity, with momentum continuing into the second quarter. Our previously announced pricing actions are now in place, and the broad-based nature of industry cost pressures supports our confidence in executing these increases while preserving our competitive positioning.”

Christian Daes, chief operating officer, addressed the tariff response and the company’s assessment of a potential US manufacturing presence. “Our pricing initiatives and cost mitigation efforts are well underway, including logistics improvements, further automation across our operations, and ongoing supply chain optimization,” he said. “We are also advancing our assessment of a proposed US manufacturing initiative, with a well-located site identified and significant state and local incentives secured that strengthen the project’s potential economics if we decide to move forward based on market demand.”

Santiago Giraldo, chief financial officer, reaffirmed full-year 2026 guidance and outlined the company’s tariff offset timeline. “Based on our strong execution to start the year, we are reiterating our full year revenue outlook in the range of $1.06 billion to $1.13 billion USD and Adjusted EBITDA outlook in the range of $225 million to $245 million USD,” Giraldo said. “This reflects the impact of the recently implemented 10% tariff on finished aluminum window imports as previously disclosed, which is expected to be partly offset in 2026 through pricing actions effective on orders from early May forward, with additional efficiency initiatives from logistics optimization and automation underway and expected to begin contributing benefits by year end. We see a clear path to fully offsetting the impact of tariffs in 2027, when full-year pricing across both businesses and incremental automation savings are expected to be realized.”

On the corporate structure front, Tecnoglass’ board of directors has approved a plan to redomicile the company from the Cayman Islands to the United States, subject to shareholder approval. If approved, the redomiciliation is expected to be completed during Q2 2026. The company stated that the move is intended to simplify its organizational and regulatory structure, improve the tax efficiency of dividend distributions, and expand its potential investor base to include funds and accounts limited to US-domiciled securities. Tecnoglass will retain its Miami, Florida headquarters following the change.

Separately, the company is conducting a feasibility study for a potential new US manufacturing facility. A site meeting project specifications has been identified and substantial state and local tax credits have been secured. The proposed facility is described as highly automated and intended to support future growth while also improving lead times, reducing transportation costs for certain markets, enhancing supply chain efficiency, and enabling the company to compete for Buy America-eligible projects and rapid-turnaround contracts. Tecnoglass expects to complete the purchase of land for the potential facility during Q2 2026, at an estimated cost of $20 million to $25 million USD to be financed through available credit facilities. The company noted that the land purchase does not constitute a commitment to proceed with construction, which would occur in phases contingent on demand, market conditions, and return profiles. The company’s 5.8-million-square-foot vertically integrated manufacturing complex in Barranquilla, Colombia, would continue to serve as its primary production base.

Above photo: Tecnoglass facilities in Barranquilla

Instacart, a US grocery technology company serving more than 2,200 retail banners and nearly 100,000 stores, announced the acquisition of Instaleap, a Colombia-founded fulfillment and retail technology platform operating in nearly 30 countries, in a deal whose financial terms were not disclosed.

The transaction represents one of Instacart’s most significant international moves since going public in 2023 and strengthens its expansion outside North America, particularly in Latin America, Europe and the Middle East.

Instacart, which trades on Nasdaq under the ticker CART, is seeking to expand its enterprise technology platform focused on omnichannel commerce and the digital transformation of supermarkets and retailers.

“We see a meaningful opportunity to expand internationally through an enterprise-led strategy that empowers retailers across the globe to meet the evolving omnichannel needs of their customers,” Ryan Hamburger, chief commercial officer at Instacart, said in the company’s statement.

Global expansion driven by Latin American technology

Instaleap develops software solutions for supermarkets, pharmacies and consumer goods retailers, enabling them to manage orders, logistics, picking operations and customer experience across digital channels.

The company has processed more than 100 million transactions and maintains commercial relationships with nearly 100 retailers and marketplaces outside North America, including Cencosud, Éxito, Makro, Continente, Jerónimo Martins (owners of Tiendas Ara), Lulu, and SPAR.

The acquisition also allows Instacart to accelerate its presence in regions where it previously had limited operations. The company had already begun deploying products such as Storefront Pro and its AI-powered Caper Carts in Europe and Australia but lacked a consolidated network in Latin America and the Middle East.

Instaleap to continue operating as subsidiary

According to the companies, Instaleap will initially continue operating as a wholly owned subsidiary of Instacart to ensure continuity for existing customers during the integration process.

“We’ve built our platform with a deep focus on the unique needs of grocery retailers across diverse international markets. Joining Instacart enables us to scale our impact with the support of a trusted partner that shares our commitment to retailer success,” said Antonio dos Santos Nunes, CEO and co-founder of Instaleap.

The company was founded in Colombia in 2019 by Portuguese entrepreneurs Antonio dos Santos Nunes and Margarida Freitas, the company’s current COO. Both joined the global entrepreneurship network Endeavor in 2025.

The companies did not disclose whether Instaleap’s current management team will remain in place after the transition period.

E-commerce growth fuels regional expansion

The announcement comes amid sustained growth in e-commerce across Latin America, particularly in Colombia.

According to figures cited in the statements, Colombian e-commerce grew 19.9% in 2025, reaching $684.6 million USD transactions, while the regional online grocery market surpassed $3.62 billion USD last year.

Instacart reported adjusted EBITDA of $1.09 billion USD in 2025, representing 23% year-over-year growth, along with 312 million processed orders.

With the acquisition, the company expects to gradually extend additional solutions to Instaleap’s clients, including e-commerce services, retail media, artificial intelligence and in-store technology.

New 10% tariff on finished aluminum windows forces EBITDA revision of ~$50M

Barranquilla-based window and architectural glass manufacturer Tecnoglass, Inc. (NYSE: TGLS) has revised its full-year 2026 financial guidance following the April 2 announcement of updated US trade policy that introduced a 10% tariff on finished aluminum window products imported into the United States.

The company stated that its first quarter 2026 performance was in line with internal expectations, supported by continued order activity and a record project backlog. Those results, the company indicated, support the continuation of its previously stated expectation of strong double-digit full-year revenue growth. However, the tariff development — which was not incorporated into the original 2026 guidance issued February 26, 2026 — required a revision to Adjusted EBITDA projections.

“We are executing at a high level to start 2026, with first quarter performance in line with our expectations and continued strength across our residential and commercial platforms. Our record backlog and strong order activity provide excellent visibility, and we continue to gain market share supported by our differentiated vertically integrated model and industry-leading cost structure. The developments in U.S. trade policy applicable to aluminum-containing imports do not reflect any change in our competitive positioning or underlying demand environment. We have proactively restructured our supply chain over the past several years to significantly reduce raw material tariff exposure, and our platform remains advantaged within our industry,” said CEO José Manuel Daes.

Tecnoglass is now guiding for full-year 2026 Adjusted EBITDA in the range of $225 million USD to $245 million USD. The updated range reflects an estimated net incremental impact of approximately $50 million USD compared to the midpoint of the company’s previously stated guidance, attributable to the newly applied 10% tariff on certain finished aluminum window imports into the US market.

The April 2 White House announcement updated Section 232 metals tariffs on steel, aluminum, and copper imports, and expanded the applicability of those tariffs to finished goods and certain derivative products containing those metals. The action affects Tecnoglass and other aluminum window exporters that ship products into the United States.

In response, Tecnoglass says it has implemented pricing adjustments effective on orders placed beginning in early May, the benefit of which is expected to materialize in the second half of 2026. The company is also advancing operational efficiency measures including logistics improvements, increased automation, and workforce adjustments. The revised guidance also accounts for the potential effect of sustained elevated aluminum prices in the second half of the year.

“The developments in US trade policy applicable to aluminum-containing imports do not reflect any change in our competitive positioning or underlying demand environment. We have proactively restructured our supply chain over the past several years to significantly reduce raw material tariff exposure.” – CEO José Manuel Daes

Santiago Giraldo, Chief Financial Officer of Tecnoglass, added, “The change to our full year 2026 Adjusted EBITDA expectations is entirely a result of the revised U.S. tariff framework, which was not contemplated in our original guidance. We have already announced pricing actions that will start with orders in early May, and we are advancing additional efficiency initiatives, including automation and logistics optimization, to further mitigate the anticipated net impact of tariffs disclosed today. These actions, combined with our strong margin profile and disciplined cost management, position us to partially offset the tariff impact as we move through the year and fully neutralize it in 2027. Our updated outlook reflects this discrete policy-driven headwind and does not change our confidence in the trajectory of the business. We remain well positioned to drive growth, expand margins over time, and continue delivering industry-leading financial performance.”

A more comprehensive update, including first quarter results and a full restatement of 2026 guidance, is expected in early May.

Tecnoglass operates a 5.8 million square foot vertically integrated manufacturing complex in Barranquilla, Colombia, and counts the United States as its dominant market, representing approximately 95% of total revenues. The company describes itself as the second-largest glass fabricator serving the US market and the largest architectural glass transformation company in Latin America. Its products have been specified for notable projects including One Thousand Museum and Paramount in Miami, Salesforce Tower in San Francisco, and Aeropuerto Internacional El Dorado in Bogotá.

The Medellín utility unit, EPM, contributed $20 trillion COP in revenue and $4.9 trillion COP in net income. Management attributed the stability of these figures to a diversified portfolio. Power generation remains the primary driver of profitability, accounting for 49% of net income, followed by energy distribution at 27%. The water, sewage, and waste management sectors contributed 15%, while transmission and natural gas accounted for 3% and 1% respectively.

In 2025, Grupo EPM obtained results that confirm its ability to advance in complex scenarios, reflecting work to achieve lasting efficiencies.” — John Maya Salazar, General Manager of EPM

Financial leverage remained within contractual covenants. The debt-to-EBITDA ratio for the group closed at 2.9x, comfortably below the 3.5x threshold required by many credit agreements. For the individual EPM entity, the ratio stood at 3.5x. This solvency allows the organization to continue its capital expenditure program, which saw $5 trillion COP ($1.36 billion USD) invested in infrastructure and social programs throughout the year.

John Maya Salazar, General Manager of EPM (photo courtesy EPM)

A significant portion of the capital budget was directed toward the Hidroituango hydroelectric project. Approximately $1 trillion COP was allocated to Stage 2 of the project, specifically turbine units 5 through 8. Beyond energy, the company continued funding the Unidos por el Agua and Unidos por el Gas initiatives, which target utility access for vulnerable populations in the department of Antioquia and other regions.

Dividend and Fiscal Transfers

During the 2025 fiscal period, EPM executed transfers totaling $2.6 trillion COP to the Distrito de Medellín. These funds, representing 55% of the utility’s 2024 net income, serve as a primary funding source for the municipal development plan. Additionally, the group generated $21.8 trillion COP in total added value across its areas of operation, including $3.7 trillion COP in taxes, fees, and contributions to the state.

The company is currently undergoing a structural reorganization intended to modernize its operating model. According to management, this transition is designed to improve strategic efficiency as the group faces future macroeconomic shifts. The group’s economic footprint in 2025 included $6.7 trillion COP paid to suppliers and the financial system, along with $3 trillion COP dedicated to direct and indirect employment costs. Total reinvestment into the group’s various subsidiaries reached $5.6 trillion COP to ensure infrastructure modernization.

Financial data and sustainability reports are routinely filed with the Superintendencia Financiera de Colombia. Interested parties can find further information on the company’s investor relations portal or through the Alcaldía de Medellín official website.

Above video: An aerial view of EPM’s Hidroituango hydroelectric dam(video © Loren Moss)

The affirmation of GEB’s ratings reflects its stable cash flow, business position, and adequate liquidity. Fitch anticipates the company’s credit metrics will remain consistent with its rating over the medium term. However, the ratings also account for GEB’s reliance on dividends from subsidiaries, its ongoing growth strategy, and a high dividend payout policy.

GEB operates a diversified portfolio of regulated businesses in electricity and natural gas transport and distribution. Its primary subsidiaries, Transportadora de Gas Internacional S.A. E.S.P. (BBB/Negative) and Gas Natural de Lima y Callao S.A. (Cálidda) (BBB/Stable), are the main contributors to its EBITDA, representing more than 70% of EBITDA from controlled companies. Dividends from its non-controlling stake in Enel Colombia S.A. E.S.P. (BBB/Negative) are expected to be the main source of dividends, averaging 60%.

Fitch projects GEB’s EBITDA leverage to increase to 4.2x in 2026 from 4.0x in 2024. The company’s free cash flow is projected to remain negative in 2025 and 2026, driven by higher capital expenditures and a dividend payout ratio of approximately 70%. GEB’s investment program is estimated to total around $1.5 billion from 2025 to 2028, with 44% directed to transmission projects in Colombia and 30% to natural gas transportation.

GEB’s credit profile is comparable to its investment-grade peers. Its ‘BBB’ rating is one notch below Enel Américas S.A. (BVC: ENELAM) (BBB+/Stable) and two notches above Empresas Públicas de Medellín E.S.P. (EPM) (BVC: EPM) (BB+/Negative). Enel Américas has a more conservative capital structure and a wider geographic footprint. EPM’s rating is linked to that of its owner, the city of Medellín. GEB is rated one notch above both AES Andes S.A. (SNSE: AESANDES) (BBB-/Stable) and Promigas S.A. E.S.P. (Promigas) (BBB-/Stable), due to its business concentration in a regulated environment compared to AES Andes, and its greater business and geographic diversification compared to Promigas.

The rating of GEB is not capped by the credit profile of its controlling owner due to regulatory ring-fencing mechanisms, material minority shareholders, and strong governance practices. These factors, under Fitch’s Parent-Subsidiary Rating Criteria, allow GEB to be rated two notches above Bogotá’s consolidated profile of (BB+/Negative).

GEB’s exposure to regulatory risk is considered low to moderate, with its geographic diversification and the strong business positions of its subsidiaries mitigating a concentration in regulated businesses in Colombia. The company’s rating is also above Colombia’s Country Ceiling (BBB-) because its applicable Country Ceiling is that of Peru (A-), reflecting the significant EBITDA generated by its Peruvian subsidiary Cálidda and dividends from its stakes in Peruvian transmission companies Consorcio Transmantaro and Red de Energía del Perú. These cash flows are sufficient to cover GEB’s foreign-currency interest payments.

GEB’s liquidity is supported by cash on hand, predictable cash flow from operations, and access to capital markets. As of June 2025, the company had approximately $327 million in cash and equivalents. It faces near-term debt maturities of $259 million in the remainder of 2025 and $495 million in 2026, which Fitch expects the company to refinance successfully.

Grupo Energía Bogotá. Photo credit: Grupo Energía Bogotá/Facebook.

The affirmation of TGI’s ratings reflects a connection to its parent company, Grupo Energia Bogotá S.A. E.S.P. (GEB) (OTCMKTS: GEB; BVC: GEB), based on what Fitch describes as medium-to-high operational and strategic incentives for GEB to support TGI. The negative outlook is consistent with Fitch’s outlook on the sovereign rating for Colombia (BB+/negative), as TGI’s cash flow is generated almost entirely within the country.

The ratings also consider the company’s position in the Colombian natural gas transportation sector, regulatory risk exposure, and capital structure. Fitch noted that the ratings also account for re-contracting risk due to a lower supply of long-term gas supply contracts.

Key Rating Drivers

Parent-Subsidiary Linkage: Fitch’s analysis of the relationship between GEB and TGI indicates a high strategic linkage, a medium operational linkage, and a low legal relationship. This is assessed using a “top-down minus one” approach, where a subsidiary’s standalone credit profile (SCP) is considered one notch below that of a stronger parent. In this case, TGI’s SCP is deemed susceptible to Colombia’s operating environment due to its domestic cash flow generation. The ratings are equalized because TGI’s SCP is one notch lower than GEB’s.

GEB’s incentives to support TGI include its nearly 100% ownership and TGI’s substantial financial contribution, which accounted for approximately 45% of GEB’s operating EBITDA at year-end 2024. Fitch expects GEB to continue its strategic focus on investing in Colombia’s midstream businesses, such as TGI.

Change in Contract Dynamics: The availability of long-term gas supply contracts has diminished, affecting commercial contracting dynamics. Regulatory changes have introduced more flexibility in gas commercialization, enabling short-term transportation contracts that align with the terms of supply agreements. This has led to lower contracted capacity for TGI, but Fitch anticipates the company will be able to renew contracts with its customers. These customers are considered part of the structural demand derived from the cities of Bogotá and Medellín, as well as the Barrancabermeja Refinery operated by Ecopetrol S.A. (NYSE: EC; BVC: ECO).

As of June 2025, TGI’s contracted capacity had an average life of 2.6 years. Fitch projects that transported volume will remain at approximately 460 million cubic feet per day (Mcfpd) between 2026 and 2027, consistent with current volumes. The average life of contracts is expected to continue decreasing as legacy agreements are renewed with shorter maturities.

Business Profile: TGI is a natural gas transporter in Colombia, with a 55% market share of transported volume. Its scale and geographic footprint provide predictability to its cash flow generation. The company’s customer base is moderately concentrated, with four distribution and marketing customers representing about 81% of revenues as of June 2025. Residential and industrial sectors accounted for 93% of revenues, providing a stable consumption pattern.

Financial Discipline and Capital Expenditures: Fitch anticipates TGI will maintain its financial discipline. EBITDA leverage is projected to peak at 2.3x at year-end 2025, influenced by lower regulatory revenues from reduced contracted volumes. Leverage is expected to decline to around 2.0x in 2026 following the implementation of a new tariff scheme. The analysis assumes TGI will fund both maintenance and expansionary capital expenditures without increasing debt levels and will maintain a dividend payout ratio of 90% of the previous year’s net income. The company has also employed hedging strategies to reduce exposure to the US dollar.

TGI is considering several projects to ensure a reliable gas supply to the interior of the country, including pipeline bidirectionality, infrastructure expansion, and a new pipeline connection in La Guajira to a Floating Storage and Regasification Unit (FSRU). While the La Guajira project may pressure free cash flow in 2026 and 2027, it is expected to strengthen the gas supply network.

Peer Analysis: TGI’s credit profile is categorized as investment-grade, with predictable EBITDA generation consistent with natural gas transportation companies such as Transportadora de Gas del Peru, S.A. (TGP) (BVL: TGP). TGI is also positioned against other regional peers in the natural gas distribution and liquefied natural gas sectors, including Gas Natural de Lima y Callao S.A. (BVL: CNL), Promigas S.A. E.S.P. (BVC: PROMIGAS), and GNL Quintero S.A.

TGI is rated one notch above Promigas due to its more conservative capital structure, with leverage below 3.0x compared to Promigas’s range of 3.5x to 4.0x. TGI’s rating is one notch below TGP, as TGP’s revenue is derived from long-term ship-or-pay contracts with a remaining average life of approximately six years, while TGI’s average contract length is 2.8 years.

The ratings also reflect the strategic and operational incentives for GEB to support TGI. In 2007, GEB provided a $370 million USD shareholder loan to TGI, which was repaid in 2023. Fitch believes that GEB could provide further support if necessary.

Liquidity and Debt Structure

As of June 2025, TGI’s cash on hand was approximately $594 billion COP, an increase from $476 billion COP in December 2024. During the first quarter of 2025, the company reduced the interest rate on its “Club Deal” facility and prepaid $50 billion COP. The Club Deal loan, which refinanced an intercompany loan from GEB in 2023, is the company’s only significant debt maturity until December 2027.

Natural gas well. (Photo credit: Ken Doerr)

The second quarter saw Frontera generate $76.1 million in operating EBITDA, with an adjusted infrastructure EBITDA of $27.1 million. The company reported a total cash balance of $197.5 million at the end of the quarter, having reduced its upstream net debt by 30%. Over the past year, Frontera has returned over $144 million to shareholders through dividends and share buybacks and has also decreased the outstanding principal amount of its senior unsecured notes by more than 20%.

In Colombia, the company highlighted increased total production, attributing it to enhanced processing capacity at its SAARA project, new flow lines in heavy oil fields, a successful well intervention program, and new natural gas production from the VIM-1 block. Production costs saw a 10.3% quarter-over-quarter decrease, while transportation costs fell by 5.7%, which the company credits to higher domestic wellhead sales.

Concurrent with its financial reporting, Frontera announced a shake-up at the board of CGX Energy. Orlando Cabrales has been appointed as the new chairman of the board, with Alejandra Bonilla and René Burgos Díaz joining as new directors. These appointments follow the resignation of Dr. Suresh Narine as executive director and co-chairman and Gabriel de Alba’s decision to step down as a director.

Analysis of Frontera’s Financial Position

Frontera’s second-quarter results present a mixed but cautiously optimistic picture for investors. The reported operating EBITDA of $76.1 million, while substantial, should be viewed in the context of a volatile global oil market. The company’s ability to reduce upstream net debt by 30% and maintain a strong cash position of $197.5 million demonstrates a disciplined approach to capital management, a crucial factor in navigating fluctuating commodity prices. The return of over $144 million to shareholders in the last twelve months through dividends and share repurchases signals confidence from management in the company’s cash flow generation capabilities.

However, the significant impairment charge of $56.4 million on the Corentyne block in Guyana, booked by its joint venture CGX Energy, casts a shadow over Frontera’s growth prospects outside its core Colombian operations. This impairment, effectively writing down the value of the asset to zero, reflects the ongoing uncertainty surrounding the joint venture’s license with the Guyanese government. For investors, this development heightens the risk profile of Frontera’s Guyanese exploration efforts and places greater importance on the performance and stability of its Colombian production and infrastructure assets.

The company’s focus on operational efficiencies in Colombia, leading to a 10.3% decrease in production costs, is a positive indicator. This suggests that Frontera is actively working to control expenditures and maximize profitability from its existing assets. The 5.7% reduction in transportation costs, driven by higher domestic sales, also points to a strategic shift that could mitigate logistical expenses and improve margins. The standalone infrastructure business, generating $27.1 million in adjusted EBITDA, provides a stable and growing source of revenue, partially insulating the company from the volatility of the upstream oil and gas sector.

Looking ahead, Frontera has adjusted its capital expenditure guidance downwards by approximately $20 million, reflecting a more conservative spending approach in the current oil price environment. The revised Operating EBITDA guidance of $320 – $360 million at a $70/bbl Brent price, and adjusted infrastructure EBITDA guidance of $110 – $125 million, provide a clearer, albeit more cautious, outlook for the remainder of the year. For investors, the key takeaways are Frontera’s solid operational performance and disciplined financial management in its core Colombian business, contrasted with the significant geopolitical and operational risks associated with its Guyanese venture. The company’s ability to amicably resolve the Corentyne block license issue with the Government of Guyana will be a critical factor in unlocking future value.

CGX Energy Board Changes and Guyana Dispute

The changes to the CGX Energy board are a direct consequence of the challenges faced by the Frontera-CGX joint venture in Guyana. Frontera, as the majority shareholder of CGX and the primary financial backer of the joint venture, is asserting greater control over the strategic direction of the company in light of the ongoing dispute with the Guyanese government over the Corentyne block license. The appointment of Orlando Cabrales, Frontera’s CEO, as the new chairman of the CGX Board, along with the addition of Frontera’s General Counsel, Alejandra Bonilla, and CFO, René Burgos Díaz, solidifies Frontera’s influence over CGX’s governance and decision-making.

The root of the issue lies in the differing interpretations of the Corentyne block’s license validity. While the joint venture maintains that its license is in good standing, the Government of Guyana has expressed its view that the license expired in June 2024. This disagreement has led to a standstill in exploration and development activities, culminating in the $56.4 million impairment charge. The Guyanese government has indicated it may consider a meeting with the joint venture in October 2025 to discuss the matter, but there is no guarantee of a favorable outcome.

Frontera’s decision to install its own executives on the CGX board is a clear signal that it intends to take a more direct and assertive role in resolving this dispute. The new board will be tasked with navigating the complex legal and political landscape in Guyana to either reach a negotiated settlement or pursue legal action to protect the joint venture’s interests. The resignations of Dr. Suresh Narine and Gabriel de Alba represent a changing of the guard, likely intended to bring a fresh perspective and a more aggressive approach to the negotiations.

The likely outcome of this board overhaul will be a more unified and Frontera-driven strategy for the Guyanese assets. This could involve intensified negotiations with the Guyanese government, a more robust legal challenge, or a strategic decision to cut losses and exit the Corentyne block if a viable path forward cannot be found. For investors in both Frontera and CGX, the board changes are a pivotal development. A successful resolution could unlock significant value from the Corentyne block’s multi-billion-barrel potential. Conversely, a failure to resolve the dispute could result in a permanent loss of the investment and a significant blow to both companies’ long-term growth ambitions in the highly prospective Guyana-Suriname basin. The new leadership at CGX faces a critical test in the coming months, with the future of the company’s most promising asset hanging in the balance.

Aruchara-4 Drilling Rig (CNW Group/NG Energy International Corp.)

The ratings are supported by Promigas’s strong business position in the natural gas transportation and distribution sectors in Colombia. These segments are regulated and function as natural monopolies, contributing to stable and predictable cash flows that mitigate re-contracting risk.

Fitch withdrew the ‘AAA(col)’ rating for the Surtidora de Gas del Caribe S.A. E.S.P. (Surtigas) local bond issuance of $330 billion COP from 2024 due to its expiration.

Key Rating Drivers

Solid Business Position

Promigas’s ratings reflect a low business risk profile, stemming from stable and predictable cash flow generation and a strong competitive position. Promigas is the second-largest natural gas transporter in Colombia, serving the Caribbean coast region. Its 3,290 kilometers of pipelines account for approximately 46% of the national network. The company is also a significant player in natural gas distribution, reaching about 38% of connected users nationwide through subsidiaries and non-controlled holdings.

Promigas’s 51% stake in Sociedad Portuaria El Cayao S.A. E.S.P. (SPEC), a liquefied natural gas (LNG) terminal, provides added flexibility to supply imported natural gas to thermoelectric plants along the coast, bolstering its capacity to meet demand fluctuations. The country ceiling applicable to Promigas is determined by Peru’s ‘A-‘ rating, as the EBITDA generated by its Peruvian subsidiaries and dividends from its 40% stake in Gas Natural de Lima y Callao S.A. (Cálidda) (BVL: CALIDDA) (IDR ‘BBB’ Stable Outlook) are sufficient to cover consolidated foreign currency interest payments.

Promigas’s cash flow is supported by operations diversified across natural gas transportation, distribution, and electric power distribution. The transportation segment, which accounts for 52.4% of consolidated EBITDA, is backed by medium-term take-or-pay contracts with capacity payments exceeding 80%, reducing volumetric risk. The gas distribution segment, contributing 30% of EBITDA, operates under a regulatory framework with low demand volatility and solid cash flows. Cash flow stability is further enhanced by dividends from non-controlled companies, which average $245 billion COP annually. The projected growth of the Peruvian market is expected to increase its share of gas distribution EBITDA from 21% to 47% over the next three years.

Recent regulatory changes aimed at increasing gas supply flexibility are credit-neutral for Promigas. The new framework allows for greater flexibility in supply contract renewal periods, facilitating shorter-term renewals, which affects transportation contract renewals in the sector. The impact on Promigas’s average contract duration remains limited, as the company maintains an average term of six years. Contractual conditions are stable, supported by Promigas’s role as critical infrastructure for the country’s gas import and transport, which supports contract renewal expectations.

Negative Free Cash Flow

Promigas’s free cash flow (FCF) is expected to remain negative in the short and medium term, continuing a five-year trend of structurally negative FCF. This is attributed to high working capital requirements in its financial services segment, high capital expenditures (capex), and consistent dividend distribution. Fluctuations in working capital, stemming from financing the non-bank financial services business and delays in subsidy payments, require significant cash resources and limit operating cash flow (OCF) available for investment. Promigas’s participation in strategic projects, such as pipeline bidirectionality, infrastructure expansion, and alternative pipeline enablement under the national supply plan, will maintain high investment requirements. Consolidated capex from 2025 to 2029 is projected at $5.6 trillion COP, with 61% allocated to transportation.

Fitch’s base case projects that gross leverage, unadjusted for financial services, will remain near 4.3x, and adjusted leverage at 4x in the coming years, leaving limited room relative to rating sensitivities. In 2024, unadjusted leverage reached 4.2x and adjusted leverage was 3.9x, supported by strong cash generation from thermoelectric demand. Fitch’s base case does not include the tariff modification planned for 2027.

To ensure comparability with other rated issuers, Fitch adjusts reported debt and EBITDA to reflect the operations of the financial services program Brilla and estimates a capital allocation for this segment, considering its risk profile. An increase in the delinquency of the loan portfolio managed by gas distributors has required additional debt resources, putting pressure on credit metrics.

Gases de Occidente S.A. E.S.P. (GDO) and Surtigas, both rated ‘AAA(col)’, have the highest independent national ratings and do not receive benefits from their parent company, Promigas. Their ratings are supported by strong business profiles, stable operational generation, low demand variability, and regulated tariffs. Fitch projects that GDO’s consolidated leverage will remain below 4x, with adjusted leverage around 2.5x. For Surtigas, leverage is expected to peak at 4.3x in 2025 due to higher working capital needs. Both companies maintain adequate liquidity, supported by available cash, predictable operations, and reliable market access.

Peer Analysis

Promigas maintains a credit profile consistent with its investment-grade rating. Its low business risk reflects its participation in regulated businesses and its strong position in the natural gas transportation and distribution sectors in Colombia.

Promigas’s ‘BBB-‘ IDRs are one notch below those of Transportadora de Gas Internacional S.A. E.S.P. (TGI) (BBB Negative Outlook) and Cálidda (BBB Stable Outlook). These companies benefit from more conservative capital structures and operate in countries with similar operational environments, such as Colombia and Peru.

Promigas’s credit profile is positioned between that of other operational holding companies in Colombia, such as Empresas Públicas de Medellín S.A. E.S.P. (EPM) (BB+ Negative Outlook) and Grupo Energía Bogotá S.A. E.S.P. (GEB) (BBB Negative Outlook). Promigas’s IDR is one notch below GEB’s due to its lower business and geographical diversification and structurally negative FCF generation, which results in higher leverage levels than GEB’s in the medium term.

The rating actions were based on a review conducted on August 21, 2025, with committee members Natalia O’Byrne (chair), Gustavo Mueller, and Adriana Eraso. The credit rating opinion provided by Fitch Ratings Colombia S.A. Sociedad Calificadora de Valores is a professional assessment and does not constitute a recommendation to buy, sell, or hold a security, nor does it guarantee the fulfillment of the rated entity’s obligations.

Promigas. Photo credit: Promigas/Facebook.

Q2 2025 Financial Performance

Aris Mining reported record revenue of $200.2 million USD, an increase of 30% from the previous quarter and 75% from the second quarter of 2024. The increase was attributed to higher gold prices and increased sales volumes.

The company’s cash balance increased to $310 million USD as of June 30, 2025, up from $240 million USD at the end of the first quarter. This resulted from cash flow from operations and proceeds from the exercise of ARIS.WT.A warrants. After the quarter’s end, the company received an additional $60.5 million USD from warrant exercises that expired on July 29, 2025. Total proceeds from these warrants amounted to $114.8 million USD, with a 98.7% exercise rate.

Figure 1: Strong AISC Margin Growth ($ million) – Segovia (CNW Group/Aris Mining Corporation)

Adjusted EBITDA reached $98.7 million USD, a 48% increase from the first quarter of 2025 and a nearly threefold increase from the same period in 2024. Over the trailing 12 months, Adjusted EBITDA was $264.0 million USD. The company invested $36.7 million USD in growth capital, with $23.6 million USD allocated to the Marmato Bulk Mining Zone and $6.9 million USD to the Segovia operations.

Adjusted net earnings were $47.8 million USD, or $0.27 USD per share, the highest since the company’s formation in September 2022. This represents an increase from $0.16 USD per share in Q1 2025 and $0.08 USD per share in Q2 2024. A non-cash loss of $45.5 million USD was recognized in Q2 2025 from fair value adjustments to the company’s warrant liability. This liability, valued at $40.8 million USD as of June 30, 2025, has been fully extinguished following the expiration of the warrants on July 29, 2025.

Q2 2025 Operational Performance

Gold production for the quarter totaled 58,652 ounces, a 7% increase from the 54,763 ounces produced in Q1 2025. Production is anticipated to increase throughout the second half of 2025 following the commissioning of the second mill at the Segovia operations in June 2025.

The Marmato Narrow Vein Zone produced 7,125 ounces, consistent with Q1 2025 levels and a 29% increase over Q2 2024.

The Segovia Operations produced 51,527 ounces, supported by an average gold grade of 9.9 g/t and gold recoveries of 96.1%.

All-in Sustaining Cost (AISC) margin increased to $87.2 million USD, a 43% increase from Q1 2025. The trailing 12-month AISC margin reached $250.4 million USD.

Owner-operated Mining AISC was $1,520 USD per ounce sold, bringing the first-half 2025 average to $1,503 USD per ounce, which is within the company’s full-year guidance range of $1,450 USD to $1,600 USD.

Gold sourced from Contract Mining Partners (CMPs) delivered an AISC sales margin of 42%, contributing to a 41% margin for the first half of 2025, exceeding the full-year guidance range of 35% to 40%.

Total AISC increased to $1,681 USD per ounce sold, up from $1,570 USD in Q1 2025. This increase was attributed to higher gold prices, which raised costs associated with material purchased from CMPs, as well as royalties and social contributions linked to gold sales.

Growth and Expansion

The company’s operations generated $74.6 million USD in cash flow after sustaining capital and income taxes in Q2 2025. After accounting for expansion capital, Aris Mining generated a net cash flow of $37.9 million USD.

Figure 2: Total AISC and Realized Gold Price Trends ($/oz) – Segovia (CNW Group/Aris Mining Corporation)

Segovia Operations Commissioning of the second ball mill at Segovia in June 2025 is expected to increase gold production throughout the second half of the year. With ongoing underground development and increased mill feed from CMPs, the company maintains its guidance for annual production of 210,000 to 250,000 ounces this year and a target of 300,000 ounces for next year. A total of $6.9 million USD was invested in Q2 2025 to support the plant expansion, underground development, and exploration.

Marmato Bulk Mining Zone Construction of the Marmato Bulk Mining Zone is advancing. The project, which involves a porphyry-hosted gold-silver system, is being developed using bulk underground mining methods. Decline development is in progress to access the mineralized zones. Earthworks for the main substation have been completed, and earthworks for the carbon-in-pulp (CIP) plant platforms are nearing completion. The company invested $23.6 million USD in the project during Q2 2025. First ore and production ramp-up are projected for the second half of 2026.

Soto Norte Project: A new Pre-Feasibility Study (PFS) for the Soto Norte Project is currently underway and is expected to be completed in Q3 2025. This study includes a smaller-scale development plan and processing options intended to support local small-scale miners. Following the PFS, Aris Mining plans to submit the necessary studies to apply for an environmental license for the project’s development.

Toroparu Project: A new Preliminary Economic Assessment (PEA) for the Toroparu Project is in progress and is expected to be completed in Q3 2025. The PEA will evaluate updated development options following the March 2023 mineral resource update and subsequent infrastructure optimization studies.

Aris Mining in Segovia. Photo credit: Aris Mining Segovia/Facebook.