Colombia court ruling on fracking paves way for contracts worth over $500 mln to advance

Colombia’s Mines and Energy Minister Diego Mesa Puyo poses for a picture in Bogota, Colombia August 28, 2020. Picture taken August 28, 2020. Courtesy Ministry of Minesn and Energy/Handout via REUTERS

BOGOTA, July 8 (Reuters) – A decision by Colombia’s top administrative court, which ruled against a lawsuit seeking to nullify regulations affecting fracking, will allow seven non-conventional energy contracts worth $517.4 million to move forward, Mines and Energy Minister Diego Mesa said on Friday.

Colombia’s Council of State on Thursday rejected a lawsuit that sought to nullify norms regulating commercial exploration and exploitation of non-conventional energy deposits, including hydraulic fracturing, also known as fracking, ruling the regulations legal. read more

Development of non-conventional energy sources, such as fracking, are controversial in Colombia, where supporters and energy companies maintain the practice is crucial for Colombia’s economy and energy self-sufficiency. Critics say it will damage the environment and bodies of water.

Though the court suspended regulations for developing non-conventional energy deposits in late 2018, it allowed investigative pilot projects to go ahead.

While Thursday’s ruling has no bearing on the pilot projects, it will allow seven contracts for non-conventional energy projects in Colombia’s Cesar province to advance to the next step, Mesa said in a video shared with journalists.

“The decision made by the Council of State has implications with respect to seven contracts that were signed between 2013 and 2016,” Mesa said, referring to deals signed with coal miner Drummond and oil companies ConocoPhillips (COP.N) and Parex (PXT.TO).

Neither Drummond nor Parex, which hold four contracts and one contract respectively, were immediately available to comment.

A spokesperson for ConocoPhillips, which has signed two contracts, declined to comment on the court’s decision.

“Those seven contracts go to the environmental licensing stage,” Mesa added.

Anti-fracking activists decried the court’s decision, saying it would endanger the environment, as well as communities near fracking projects.

Colombian President-elect Gustavo Petro, who takes office in August, has vowed to block fracking once in office and also promised to put an end to the pilot projects.

Reporting by Oliver Griffin; editing by Jonathan Oatis

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