In recent years, Colombia has had tremendous success in turning around the business environment. What are some of the factors that brought about this change?

It’s a combination of factors. Worldwide, the high oil prices and the amount of money that oil companies are willing to spend on exploration have led companies to look at countries like Colombia.

Colombia has good geological prospectivity, a sound business environment, improvements in security, and a new petroleum policy, including the creation of the ANH as the administrator of the resource. There have also been good improvements in the country’s fiscal terms, which are straightforward, transparent, and provide expedited licensing policies.

How do investment terms in Colombia measure up against other countries?

We have one of the best regimes in terms of licensing processes, the structure of our contracts, and the fiscal terms available. We are not a petroleum country, but we have good prospectivity, and we do need investors. We have one of the most profitable fiscal regimes in the world.

What has Colombia done in terms of offshore and onshore licensing?

By the end of 2007, we had awarded around 70 new licenses. Now, we have initiated a different type of round that is for the development of heavy oil in the Llanos region in the heavy oil belt. We know that there are very clear indications of heavy oil in the area, but the area needs a lot of exploration work.

For that purpose, we have invited 25 companies that have proven experience in heavy oil development. We are in the first rounds of that process.

The total area under exploration is about 12% of the 100 million hectares which is 12 million hectares.

Would you say that the Llanos region is the area with the most potential?

This area has a lot of potential because of the size and the very firm indications of oil, proven by the existence of two very important production fields; Castilla and Rubiales. In the past, these areas were ignored, but these days, with the high price of oil, the availability of technology

to produce and process heavy oil, and the interest of the industry in heavy oil, there

is tremendous interest for the area.

What are the other exciting areas?

The north coast, onshore and offshore, has tremendous potential for gas. In fact, we just had a recent discovery called la Creciente, which looks very promising.

Then we have what we call Cordillera Oriental, which is the area around Bogotá toward the northeast, where early work is taking place and where the agency has done some work along with the National University. We are just finishing a complete modeling of the area.

I think the Putumayo is showing some of the best results from the recent exploration campaign. We are only working on one corner of the basin extending to the east, and it is a very substantial basin that is totally unexplored. It is adjacent to producing areas in Ecuador and Peru.

We also have areas in the Pacific, where India’s Reliance has just been awarded two large production contracts. It’s an area where multiple seismic surveys have taken place and shows very interesting structures.

The most exciting area is Chocó onshore Pacific, on which we are undertaking early exploration work together with the EAFIT, a university in Medellin. The have just finished the modeling of the area and have uncovered very interesting potential.

Finally, we have the ultra deep offshore in the Caribbean, where we see a lot of prospectivity, but we are still in the early days.

This year foreign direct investment in the oil and gas sector reached US $4 billion. What are the most significant investments being made?

The Tayrona block in the Caribbean offshore is one. It is being developed by Petrobras in association with ExxonMobil and Ecopetrol. There are also the Fuerte blocks, operated by BHP Billiton. The company is investing heavily in seismic research and should be drilling the first well in 2008.

Then we have the Nare Velazquez production of heavy oil and Mansarovar, a joint venture between ONGC and Sinopec. They are investing US $1 billion. They are trying to prove the existence of 300 million bbl of oil in the area

In Rubiales, US $800 million to $1 billion are being invested, some of which will fund a pipeline that will connect with the Ocensa Pipeline, increasing production from about 20,000 b/d to 150,000 b/d.

Caño Sur is an area being developed by Ecopetrol and Shell. This is the area that brought Shell back to Colombia.

Then we have Putumayo, where there have been quite a lot of discoveries, and la Cira Infantas, an area operated by Occidental. La Cira Infantas is undergoing a hard recovery project that is going to increase the final recovery. There have been 3 billion bbl of oil in that one project alone.

Capacity has been doubled at Cartagena Refinery, and there is the Guajira-Maracaibo Pipeline operated by Endesa. Gas export began in late 2007, with first gas beginning to flow to Venezuela.

The Minister has set the target of drilling 100 wells per year. What are your primary objectives?

We have a few. First of all, we will continue with the licensing efforts. We will be launching our Colombia round in February at the conference in Cartagena. We will continue with the preparation of two further areas for 2009, Chocó in the Pacific and Southern Silo.

We also will begin construction of a new building for the information databank and technical services to conduct studies and provide investors help for studying prospectivity. We will present the project to the government to increase the personnel of the agency. We are restructuring the information databank so that we can develop our own software and own solutions, which we can make available to other information databanks around the world.

In 2008, investment will go up a bit. So far, we have seen investment in exploration. In 2008, we will see investment in development of new discoveries.

Does this mean a shift in the way that ANH works?

We will focus our efforts differently. In 2008, we will be charged with the direct control of operations, which now takes place in the ministry. This year, we will initiate the commercialization of the royalties, which at the moment is done by Ecopetrol. We are moving toward direct control and supervision of operations. Ecopetrol will be completely detached from any government role.

What should the world know about investing in Colombia?

There are a whole lot of opportunities. The initiation in the exports of gas to Venezuela is a huge development. In four to five years, we have the Venezuelan gas being available for export to the United States, Ecuador or Peru. If Tayrona or Fuerte is successful there will be potential for LNG export terminals. Any gas found in the Pacific will be for export.

The biggest obstacles are the outdated perception of Colombia not being a safe place to visit, but we are inviting investors to come to visit so they can see for themselves. We have a lot of bad press, but seeing for themselves will change their impressions.