Looking back at the Colombian oil industry's terrible 2015

El Tiempo published a retrospective looking back at what happened in the Colombian oil industry in the last year. The report warned that the 16 straight months of decline in global oil prices are very worrying for oil production and exploration companies. According to statistics from the National Hydrocarbons Agency, the sector drilled just 25 exploratory oil wells, a precipitous decline over the previous year. Worse, just two of the 25 wells were a success.

Portafolio noted that although drilling dropped, oil production actually increased in 2015 over the previous year, as oil companies and the Colombian government sought to make up for the lost revenue. Nonetheless, the amount of drilling represented a 20-year low, which is worrying for Colombia, as it has oil reserves for just 6 more years.

As terrible as the oil crisis is, Goldman Sachs & Co. warned that things are even worse for the mining industry. Goldman explained that mining companies are opting to maintain production until their cash runs out despite the slowdown in global demand for their mining products. The advantage that the mining industry has over the hydrocarbons industry, though, is an increased ability to store surplus production, rather than simply lowering prices. 

In other oil-related news, oil sector workers are worried about a possible privatization of Colombian state-owned oil company Ecopetrol due to the disaster of the Reficar S.A. oil refinery in Cartagena for its incredible delays and cost overruns.  The expansion of the oil refinery has been persistently marked by waste and corruption, and the oil sector workers worry that rather than cut down on this waste, the Colombian government will instead opt for privatization.