Colombia's state oil company Ecopetrol (NYSE: EC) will present to its board next week a plan to extend licenses for the Rubiales heavy oilfield held by Toronto-based Pacific Rubiales (TSX: PRE).
"This is a very good project. It would increase production by 100,000b/d and extend the parallel contract to 2032," Ronald Pantin, Pacific Rubiales CEO, said in a conference call with investors and analysts.
An MOU would preempt a final agreement.
Pantin in May said that Pacific Rubiales was interested in talking with Ecopetrol to sign a parallel contract for secondary recovery on the Rubiales field.
The agreement would be vital to Pacific Rubiales' production after 2016, the year the company's concession for the Rubiales field expires, Pantin said at the time.
Pacific Rubiales operates the field with a 40% stake and Ecopetrol holds the balance. Pacific Rubiales' netback for the Rubiales field is 36% after royalties.
The Rubiales concession is operated under older contracts with Ecopetrol, which means the state company is in charge of any concession extension instead of the country's new ANH hydrocarbons regulator.
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