(Bloomberg) -- Colombia needs new oil exploration after a drop in the nation’s proven reserves as the government seeks to accelerate its energy transition, according to former Finance Minister Jose Antonio Ocampo.
The Andean nation had proven crude reserves equivalent to 7.5 years of output as of the end of 2022, down from 7.6 years in 2021, according to recent data by the National Hydrocarbons Agency. Natural gas reserves dropped to 7.2 years from 8 years previously.
“The recent report from the agency clearly shows that we should do more exploration,” Ocampo, 70, said in a phone interview. “The problem is not for this government, since with the already exploited reserves, it can maintain good oil exports. The problem is this government’s inheritance to the following ones.”
President Gustavo Petro, the first leftist Colombian leader, ends his presidential term in 2026. His unexpected ouster of Ocampo in a cabinet reshuffle in April sank markets, as the former finance chief had been seen as a moderating force against Petro’s proposals to overhaul the country’s conservative economic model.
Read more: Petro’s Pick for Colombia Finance Chief Sends Peso Tumbling
The administration recognizes that Colombia is still too dependent on oil for its export basket and the balance of payments, said Ocampo, a Columbia University professor.
“The trade minister, the current finance minister, and the president of Ecopetrol, and as I said, we are all of the view that with this report, we must seriously think about making new explorations,” he said.
Trade Minister German Umaña said in an interview this week the government will study the need for more oil contracts as the energy transition toward clean energy shouldn’t hurt economic sustainability.
Given the Andean nation is a minimal oil producer with just 0.6% of global output, stopping oil production won’t have any impact on the fight against climate change, Ocampo said.
“If we stop exporting oil, someone else will do it,” he said. “There is no contribution through that mechanism to combat climate change worldwide.”
--With assistance from Andrea Jaramillo.
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