Dow Jones Business News - U'wa Tribe Renews Resistance After New Colombia Oil Find
biz.yahoo.com Tuesday March 4, 2:20 pm ET By Dan Molinski, Of DOW JONES NEWSWIRES
BOGOTA (Dow Jones)--One day after Colombia's state oil company Ecopetrol said it found an estimated 200 million barrels of "high quality" crude on what is ancestral land of the U'wa Indians, tribal officials said they plan to oppose further drilling on the site.
But, unlike in the past, the U'wa aren't talking about group suicide.
"We are going to ask to meet directly with the national government on this issue because we do not accept drilling here," tribal spokesman Trinidad Cobaria said Tuesday in a telephone interview with Dow Jones Newswires.
He added: "But as far as threatening to join hands and run and jump off a cliff, no, we won't be doing that."
The U'wa gained notoriety in 1999 when they threatened exactly that - mass suicide - if the original contract holder for the Gibraltar I well, Occidental Petroleum Corp. (NYSE:OXY - News) , began drilling.
A legal dispute with the U'wa ended with Occidental receiving the green light to explore, as the well, located near the border with Venezuela in the state of Boyaca, is outside the official boundaries of the U'wa reserves.
The Los Angeles-based firm began drilling in 2000 and the U'wa never followed through with its suicide threat.
Occidental originally said the well may hold up to 1.2 billion barrels of reserves, which would put it on par with the nation's top two fields, BP PLC's ( BP) Cusiana-Cupiagua and Occidental's Cano Limon, which when discovered had reserves of more than 1 billion barrels each.
But the drilling failed to produce results and Occidental stopped looking in July 2001.
After Occidental handed the contract back over to Ecopetrol, the state-run firm decided to try its hand at the well. It began looking for oil at Gibraltar last November.
The U'wa, meanwhile, said Ecopetrol would never find a drop of oil, claiming its ancestral gods would hide what it calls "the blood of the earth."
After Ecopetrol's President, Isaac Yanovich, announced Monday that oil has, in fact, been found at Gibraltar, U'wa spokesman Cobaria said with a slight chuckle that the gods simply didn't hide all of it.
"Yes, Ecopetrol found some oil, but from what I've just seen on the television news, it's a tiny amount compared to what (U.S. firm) Occidental had originally expected to find there," he said.
Occidental Didn't Dig Quite Far Enough
The discovery at Gibraltar, if confirmed by upcoming final tests, would be the largest ever for Ecopetrol, albeit much less than earlier estimates of the well's potential.
The find was made at a depth of 12,050 feet, after an investment of about $9.5 million, Yanovich said Monday.
An Occidental official told Dow Jones Newswires in 2001 that the company gave up looking for oil on the same well at a depth of 12,000 feet, after spending $ 60 million and only finding traces of gas and water.
Yanovich noted that Occidental has no rights to the find, since it abandoned the project.
The possible discovery of 200 million barrels of crude at Gibraltar is by no means the answer to the country's oil or economic problems, however.
The administration of Uribe says it needs to find a total of 1 billion in reserves by the end of his four-year term, which began in August, in order to avoid becoming a net importer.
Oil and its derivatives are Colombia's main export, accounting for more than 25% of total foreign revenues.
As Latin America's fourth-largest producer, the country produced about 580,000 barrels a day of crude in 2002 - about half for export - but total production will fall to about 535,000 barrels per day this year.
The country produced a total of 210 million barrels last year, while adding only 114 million barrels to its proven reserves. The country's estimated total reserves were 1.8 billion barrels at the end of 2001.
The search for oil in Colombia has been hurt by a long-running rebel conflict that has scared off many would-be investors.
Marxist rebels blew a hole in the No. 2 Cano Limon oil pipeline 40 times last year.
-By Dan Molinski, Dow Jones Newswires; 571-600-1980; colombia@dowjones.com