Colombia’s Oil and Gas Industry on the Brink of Collapse

Colombia’s new government, led by President-elect Abelardo de la Espriella, is poised to make significant changes to the country’s oil and gas industry. The industry has been struggling in recent years, with oil and natural gas production declining sharply over the last decade.

Source: s.yimg.com

According to the National Hydrocarbons Agency (ANH), Colombia’s oil output has fallen from 915,087 barrels per day in 2016 to 724,910 barrels per day in April 2026. This decline has led to a significant increase in costly liquified natural gas (LNG) imports, which has fueled inflation and created structural problems for the country’s balance of payments.

The situation is exacerbated by the fact that Colombia imports nearly a third of the natural gas it consumes. This has driven up prices by 25% to 36% in many parts of the country, threatening affordable electricity generation and further straining the country’s fragile economy.

De la Espriella’s Plan to Revive the Industry

President-elect De la Espriella’s plan to revive the industry is centered around promoting investment in Colombia’s flagging oil patch and driving higher hydrocarbon production. He intends to defend Ecopetrol as a key government-controlled asset and promote natural gas as the interim fuel for the clean energy transition.

One of the key measures De la Espriella plans to take is to reactivate exploration and production activities after a moratorium was imposed by the previous government. He also intends to resurrect the controversial unconventional oil extraction technique, hydraulic fracturing, or fracking, in Colombia. However, this will be restricted to pilot operations controlled by strict regulations.

The regulations will ensure that fracking operations are only carried out on geologically stable land without seismic risk and do not pose a hazard to waterbodies, the local environment, or indigenous rights. A social license must be sought by the operator, where local communities consent to the fracking pilot operating within their district.

Estimates vary, but Colombia’s oil regulator, the ANH, says the country holds 3 billion recoverable barrels of shale oil and 34 trillion cubic feet of shale gas. If confirmed, fracking will significantly boost Colombia’s waning proven reserves, which fell again in 2025. Higher oil and natural gas production will mitigate the economic risks arising from insufficient domestic supply.

A New Era for Colombia’s Oil and Gas Industry

The new government’s plan to revive the oil and gas industry is a welcome development for Colombia, which has been struggling to meet its energy needs. With the right policies and regulations in place, the industry can once again become a major contributor to the country’s economy.

However, the path ahead will not be easy. The industry faces significant challenges, including environmental concerns and the need to ensure that local communities are consulted and involved in the decision-making process.