Ecopetrol Stakes Bold Claim in Colombia's Renewable Future with $320M Portfolio Acquisition
BOGOTÁ, Colombia — Colombia's largest oil company is rapidly reinventing itself as a major renewable energy player in a move that significantly accelerates its green transition goals and reshapes the country's energy landscape.
Ecopetrol S.A. announced today that it has signed an asset purchase agreement with Statkraft European Wind and Solar Holding AS to acquire a substantial portfolio of renewable energy projects across Colombia. The deal encompasses nine special purpose entities and one development company controlling up to 1,364 megawatts of solar and wind capacity—a quantum leap that will vault Ecopetrol well beyond its stated decarbonization targets years ahead of schedule.
The acquisition, estimated by industry analysts to cost between $220 million and $320 million, includes 614 megawatts of solar projects spread across the departments of Sucre, Córdoba, Caldas, and Magdalena, alongside 750 megawatts of wind projects concentrated primarily in the wind-rich coastal department of La Guajira.
Ecopetrol S.A. Key Information
| Category | Details |
|---|---|
| Company Name | Ecopetrol S.A. |
| Founded | 1948 (restructured 2003) |
| Headquarters | Bogotá, Colombia |
| Ownership | Majority owned by Republic of Colombia (88.49%) |
| Stock Listings | Colombian Stock Exchange, New York Stock Exchange (EC) |
| Business Segments | Exploration & Production, Transport & Logistics, Refining & Petrochemicals, Electric Power Transmission |
| Operational Presence | Colombia, USA (Gulf of Mexico, Permian Texas), Brazil, Peru, Panama, South America, Central America, Caribbean, Asia, Europe |
| Key Assets | 2 major refineries (Barrancabermeja, Cartagena), 2 minor refineries (Orito, Apiay), ~9,127 km pipelines, 3 ports (Coveñas, Cartagena, Tumaco) |
| Products | Crude oil, natural gas, refined petroleum products, LPG, petrochemicals |
| Financials (Revenue) | US$31.28 billion |
| Financials (Net Income) | US$3.50 billion |
| Financials (Total Assets) | US$73 billion (2023) |
| Market Capitalization | Approximately US$17-21 billion |
| Employees | ~9,315 |
| CEO | Ricardo Roa (Chairman & CEO) |
| Environmental Impact | 0.71% of global carbon emissions, ranked 75th largest emitter (2023) |
Energy Independence Play in a Volatile Global Market
For Ecopetrol, traditionally defined by its oil and gas operations, the move represents more than merely checking a sustainability box. The company currently consumes approximately 6.5 terawatt-hours of largely fossil-derived electricity annually to power its extensive operations across Colombia.
"This is fundamentally an energy security play wrapped in green packaging," noted one Bogotá-based energy consultant who requested anonymity due to client relationships. "At current industrial electricity rates approaching 140 Colombian pesos per kilowatt-hour, displacing 2.4 terawatt-hours of spot market exposure could save Ecopetrol roughly $330 million yearly."
The portfolio's development status varies significantly—about 130 megawatts of solar capacity is already operational, while approximately 450 megawatts of solar and 300 megawatts of wind projects are ready-to-build. The remaining capacity exists in mid-stage development, with commercial operation dates projected between 2026 and 2028.
Strategic Synergies with Transmission Holdings
What distinguishes Ecopetrol's renewable ambitions from competitors is its unique ownership position in Colombia's power transmission infrastructure. In 2021, the company acquired a controlling 51.4% stake in ISA, which operates over 18,000 kilometers of high-voltage transmission lines across Latin America.
This vertical integration provides Ecopetrol with strategic advantages in a country where grid connection limitations have become a critical bottleneck for renewable development, particularly in La Guajira, where transmission capacity lags behind the region's world-class wind resources.
"The ISA ownership gives them leverage that independent developers simply don't have," explained a former Colombian energy ministry official now working in the private sector. "They can potentially sequence construction to match grid upgrades and have better visibility into the interconnection queue."
This advantage could prove decisive, as Colombia's grid operator UPME currently shows more than 12 gigawatts of connection requests in La Guajira against only 4 gigawatts of available capacity. ISA's Colectora II transmission line, a critical 400-kilovolt connection for the region, remains only partially complete.
Financial Implications and Balance Sheet Strength
Despite the substantial price tag, the acquisition appears readily digestible for Ecopetrol's balance sheet. At the end of March 2025, the company reported a net debt-to-EBITDA ratio of just 1.3 times and held approximately $1 billion in cash.
Even accounting for the full equity outlay for the Statkraft portfolio, Ecopetrol's financial leverage would remain below 1.5 times EBITDA—comfortably within its investment-grade credit parameters. Additionally, management secured board authorization in March to raise up to $2 billion in additional debt specifically earmarked for inorganic growth opportunities.
The returns profile appears compelling when compared against traditional upstream investments. At current Colombian electricity prices—which have averaged $38-42 per megawatt-hour for blended merchant and power purchase agreement rates—these renewable assets could generate unlevered project returns of 10-12% for solar and 11-14% for wind projects in local currency terms.
Execution Challenges Could Delay Full Benefits
Despite the strategic rationale, significant obstacles may delay the full realization of the portfolio's potential. Chief among these are transmission constraints and social license challenges that have plagued renewable development in La Guajira.
Indigenous Wayuu communities have effectively halted at least three major wind developments since 2023 through protests over consultation concerns and demands for greater economic participation. While Ecopetrol's decades-long presence in Colombian energy infrastructure and established community engagement frameworks may mitigate these risks somewhat, they remain substantial.
"Each year of delay in commercial operation erodes project returns by about 110 basis points," calculated an infrastructure investment analyst at a major Colombian pension fund. "So the difference between a 2026 and 2028 commissioning date is material to the overall investment case."
Beyond the Headline Numbers
While substantial, the acquisition alone will not transform Ecopetrol's business model overnight. Even when fully constructed, this renewable capacity will meet less than 15% of the group's electricity demand.
The deal does, however, dramatically accelerate Ecopetrol's progress toward its 2040 Strategy targets. The company had previously set a goal of incorporating 900 megawatts of renewable self-generation capacity by 2025. This single transaction, when combined with existing investments such as its 49% stake in Jemeiwaa Ka'I and the pending 205-megawatt Windpeshi acquisition, raises its total installed and contracted renewable portfolio to approximately 2.6 gigawatts.
Market Reaction and Investor Implications
The transaction, which remains subject to regulatory approvals from Colombia's Superintendence of Industry and Commerce and grid capacity confirmation from UPME, is expected to close in the third quarter of 2025.
For investors, key milestones to monitor include the UPME grid capacity awards, which will determine which wind projects can connect before 2028; antitrust clearance decisions that might preview potential joint venture partners; and final investment decisions expected in 2026 that will reveal whether capital expenditure estimates around $950 million hold or face inflationary pressures.
"Pro investors should track grid allocation and capital discipline rather than near-term earnings impact," advised a senior utilities analyst at a global investment bank. "Those metrics will reveal whether this strategy can justify a higher valuation multiple over the economic cycle."
In the bullish scenario, successful execution could shift the investor narrative from "forced decarbonization" to "returns-accretive diversification," potentially adding up to $1 billion to Ecopetrol's market capitalization. Conversely, significant delays coupled with weaker oil prices could pressure the company's leverage above 2.0 times EBITDA, potentially forcing dividend cuts.
Transforming Colombia's Energy Landscape
For Colombia, the deal represents another significant step in the national energy transition. The country's most recent reliability-charge auction secured 1.3 gigawatts of renewable capacity at a weighted average price of $28 per megawatt-hour, and the Ministry of Mines and Energy is preparing a follow-up round with explicit grid capacity earmarked for La Guajira developments.
As Ecopetrol's statement emphasized, the company "reaffirms its commitment to the country's energy future through the integration of renewable energy projects into its operations." With this acquisition, Colombia's energy champion is backing those words with substantial capital and a clear strategic vision—even as significant execution challenges remain on the horizon.