Ecopetrol asks the United States for permission to negotiate with PDVSA

Gustavo Petro and Nicolás Maduro during a meeting in Caracas, on November 1, 2022. Miguel Gutiérrez (EFE)

Relations between Colombia and Venezuela have reached cruising speed since Gustavo Petro and Nicolás Maduro met in Caracas in early November.

The countries now intend to connect energetically, so the Colombian state oil company, Ecopetrol, has asked the United States for permission to negotiate with the Venezuelan company, PDVSA.

The public company controlled by the Chavista government is under sanctions from Washington, which prevents companies and individuals from doing business with it.

Permission is not necessarily going to be easy to get.

Months ago, it was agreed that Conviasa, the Venezuelan public airline, would cover the Caracas-Bogotá route.

The planes were ready to fly when the United States used all its intimidation power to prevent it.

The US embassy sent letters to Colombian officials reminding them that Conviasa was also on the list of the Office of Foreign Assets Control (OFAC), known as the Clinton list, and that anyone who offered it a service, such as

or the cleaning of the ships, could be persecuted by the American justice system.

Colombia backed down and Venezuela was furious.

Only one airline, Turpial, currently covers the route.

Countries hope to reap better results this time.

Ecopetrol, the country's largest company, has formally filed an application with OFAC to receive a license to operate with PDVSA, similar to the one Chevron has received, in order to import gas.

The office granted an authorization to the US oil company to resume limited oil extraction operations in Venezuela after Chavismo agreed to return to talks with the opposition in Mexico, from where a proposal for credible presidential elections in 2024 has to come.

An employee works at an Ecopetrol refinery in Colombia in 2018. Nicolo Filippo Rosso (Bloomberg)

In 2004, Álvaro Uribe and Hugo Chávez signed a binational energy connection agreement between both countries.

It was then agreed that Ecopetrol and Chevron would sell gas to PDVSA.

That deal lasted from 2007 to 2015 and the Venezuelan oil company paid everything owed.

From that date on, it had to be the opposite: the Venezuelans would sell it to the Colombians.

That would last from 2015 to 2027, but it has not been able to come into effect.

First, due to the phenomenon of warming of the Pacific Ocean, known as El Niño, and later due to the sanctions, to which was added that Colombia found more gas in its territory.

The export issue faces some problems.

Colombia already produces 80% of the gas it consumes.

There are some producers who cannot sell everything they produce, so there is an oversupply.

In parallel, new offers have emerged that make business between the two countries difficult.

Venezuela authorized a private company, Prodata Energy, to export natural gas to Colombia for the first time a month ago.

Caracas-based Prodata has obtained permission to send through a 224-kilometre pipeline that has been inactive until now.

This agreement, according to Bloomberg, helps Venezuela to diversify its energy exports, which are the base of its economy.

It reinforces the supply from Colombia, where the market expects production to decrease due to President Petro's intention to lead the country towards green energy.

In this complex context, Ecopetrol and PDVSA want to conclude an executable contract in 2023 that is beneficial to both nations.

All that remains is for the United States to grant its consent.

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