FARC renews attacks against Colombian oil infrastructure

Over the weekend, the FARC renewed its attacks against Colombia’s oil infrastructure. The leftist criminal and terrorist organization had turned to bombing Colombia’s oil pipelines and attacking refineries and oil workers as its primary means of fighting the Colombian government. These attacks depressed Colombian oil production and were much easier to carry out than high-profile bombings in Colombia’s major cities.

However, the FARC has been negotiating a peace agreement with the Colombian government, and during the negotiations, it had significantly decreased the number of its attacks against the country’s oil infrastructure. In recent weeks though, the talks have been severely threatened by an outbreak of new violence between the FARC and the Colombian military, and it appears that the moratorium on attacks against Colombian oil pipelines has also been broken.

This most recent attack occurred in the southern department of Putumayo, when early Sunday morning, the FARC simultaneously bombed the San Miguel-Orito pipeline and the Loro Ocho oilfield, and harried the troops guarding the Yurilla and Sibundoy oil fields.

Late last week three Colombian soldiers were killed by the FARC while they were protecting oil fields in the department of Arauca in northeast Colombia. Three FARC guerrillas were also killed in the fighting, and were found wearing army uniforms. The Colombian military said in a press release that it believes that the FARC was ready an attack against an oil complex in the area.

The resumption of attacks against Colombia’s oil infrastructure is a worrying development for the country’s government and its oil sector. Colombia is doing everything it can to keep oil production high to compensate for low oil prices, but FARC attacks against the country’s oil pipelines might prevent it from keeping its average oil production above the 1 million bpd threshold.

Peru's 48-hour solidarity strike ends without violence

A massive strike across almost a third of Peru concluded yesterday, as protestors took to the streets to cry out in support of their fellow protestors in the province of Islay, who took to the streets for more than two months to stop the Tía María copper mining project. The strikes forced schools to close in four regions across Peru, Arequipa, Cusco, Puno, and Moquegua.

One striker in Puno, Adolfo Choque, told Telesurtv, “[The action] was spontaneously convened. Here we don't have leaders, but all the organizations have emerged so that we go on strike this time. In this manner [we] support all our brothers in the province of Islay that are defending their rights and their natural resources and whose products might be the source of food for the whole region of Puno.” The United Nations Regional Office for Human Rights called for a de-escalation of tensions between the Peruvian government and the protesting local communities.

The Associated Press spoke with local officials in the city of Arequipa, where 2,000 police officers had been deployed in anticipation of the strike. The local officials confirmed that “not a single violent act” occurred din the city.

Peruvian daily Los Andes published an editorial about the conflict, framing the protests in the context of the mining industry versus rural farmers. The editorial acknowledged that many Peruvian are frustrated with President Ollanta Humala for not taking a stronger stand against people that they consider to be uneducated hillbillies. Nonetheless, the editorial acknowledges that the farmers are just thinking about their future livelihood and our drawing lessons from what has happened to similar areas in Peru.

In oil-related news, Peru plans to open bidding for the right to build a $250 million liquefied petroleum gas pipeline and boost reserves in Lima and address the supply crunch of LPG that the country has been experiencing.

Ecopetrol budgets $1B less per year for investment through 2020

On Tuesday, Colombian state-owned oil company Ecopetrol published its 5-year strategic plan, which projects an annual investment budget of just $6 billion through 2020. The annual exploration budget will lie between $1 billion and $1.5 billion, with an additional $4 billion invested annually in boosting production and efficiency at existing fields.  Ecopetrol hopes to boost its production by 1 to 2% each year, with the goal of producing approximately 870,000 bpde in 2020.

Reuters noted that the reductions in spending are part of a recent cost-cutting drive by Ecopetrol to save the company $6 billion in costs from now through the end of the decade.

On Tuesday, Colombian finance minister Mauricio Cárdenas and Colombian mining minister Tomás González testified before the Colombian Senate, as the legislative body debated the Santos government’s oil policy. Senators were worried about the country’s oil self-sufficiency in light of the country’s shrinking oil reserves and the minimal amount of oil exploration.

Minister González agreed that oil exploration has slowed considerable and that new initiatives will need to be considered to encourage oil companies to invest in the country. He warned that if Colombia should prove unable to stimulate exploration, its production would fall. Minister Cárdenas added that the lack of exploration is due simply to the fall in oil prices and that Colombia will need to be create to counteract that market trend.

Fortunately for the Colombian oil sector, American companies have started lining up to present proposals for developing Colombia’s fracking potential. The Colombian government knows that the best way to grow the country’s oil reserves is to use hydraulic fracturing to extract otherwise-inaccessible oil.

Peru sends in the army as anti-mining protests spread

The social conflict that started as a small-scale protest over the Tía María copper mining project has spiraled completely out of control. The protests have spread across Peru and become more generalized, turning into a wholesale rejection of the Peruvian mining industry. On Tuesday, the Peruvian government announced that it would deploy the country’s army to the regions of Apurimac, Ayacucho, Cajamarca, Cusco, Moquegua, Puno, and Tacna, to bolster security in advance of a 48-hour strike the protesters have planned for Wednesday and Thursday. According to the Peruvian Interior Ministry, the deployed troops “will only support the police and guarantee control and public order.”

Peruvian President Ollanta Humala on Friday declared a state of emergency in the Tambo Valley in southern Peru. According to Telesurtv, 13 people have been arrested since the state of emergency was imposed, which allows security officials to enter private property without a warrant.

The anti-mining protests spread to Peru’s Ica province, where one man died and another was injured in protests against China’s Shougang Hierron Peru mining company. According to news reports, Luis Quispe Chumpi was shot in the jaw when protestors clashed with police on a local highway. The protestors have a list of demands, including that Shougang bring back 85 laid-off workers, provide safe drinking water to the district, and lower electricity prices.

Bloomberg spoke with Carlos Galvez, president of Peru’s National Society of Mining, Petroleum, and Energy, who warned that the recent wave of protests could cause investment in mining in the country to vanish as soon as 2018. Bloomberg called the protests “the biggest wave of anti-mining opposition in three years.” Galvez called on the Peruvian government to defend new mining projects as vital to the country’s economic growth.

Last bodies recovered in Colombian mine collapse that killed 15

On Monday, Colombian authorities announced that emergency workers had recovered the last bodies of the miners trapped and killed in a collapsed gold mine in the town of Riosucio, in Colombia’s Caldas department. UNGRD, the Colombian government’s disaster relief agency, said in a statement, “After 12 days of working around the clock... the bodies of the 15 miners who were trapped in the El Tunel gold mine when it was suddenly flooded... have now been recovered.”

The mine collapse happened on May 13 and was triggered by a power outage that shut off the mine’s pumps and allowed it to be flooded by the nearby Cauca river. The local authorities asserted that they would investigate the causes of the accident. The Colombian government confirmed that all of the dead miners were men, and that the UNGRD was providing counseling to the men’s families.

In follow-up reporting to the tragedy, Colombian daily El Espectador spoke with Jorge Martín Molina Escobar, a Geosciences and Environment professor at the National University’s Medellin campus. Molina Escobar warned that, “With the way things are, we should expect mining accidents on average every three months.” He explained that this is because Colombia has a large artisanal, and often illegal, mining industry, and 66% of all mining accidents occur in artisanal mines. Though the National Mining Agency has made considerable strides in regulating the artisanal mining industry, the more than 10,000 mines in the country make it impossible to completely avoid these types of tragedies.

In related news, the Colombian Ministry of Mines and Energy is continuing its efforts to formalize the country’s artisanal mining sector and on Monday announced a mining formalization plan for the Colombian departments of Santander, Cauca, Cundinamarca, Guajira, Valle del Cauca, Boyacá, and Tolima. The implementation of the plan will carry a budget of more than $11 million.