July 25, 2012 / 5:57 PM / 5 years ago

UPDATE 2-Rebel attacks hit Ecopetrol's oil production

(Adds details from investor call, background)

By Jack Kimball

BOGOTA, July 25 (Reuters) - Colombia's largest oil producer, Ecopetrol, lowered its 2012 oil production target on Wednesday by 2.5 percent to 780,000 barrels of oil equivalent per day (boepd) after a string of rebel attacks on oil infrastructure, but kept its future output goals.

Once seen as a failing state, Colombia began to turn its image around after a 2002 U.S.-backed security crackdown against leftist rebels made the country safer, opened up more areas to oil exploration and boosted crude production.

In a call to investors, Ecopetrol's vice president of exploration and production, Hector Manosalva, said that production was being restricted this year due to security problems in Latin America's No. 4 oil producer.

"The damages we've had are related to the unavailability of transport systems due to public order problems, and this has affected mainly the Cano Limon fields and the fields in Arauca operated by Occidental and the fields in the Putumayo," he said.

The company, however, said that it was not revising down its future output goals -- Ecopetrol plans to produce 1 million boepd by 2015 and 1.3 million boepd by 2020.

A series of attacks this year by rebel groups, including the killing and kidnapping of oil workers and a three-fold increase in bombings of pipelines, have hit the sector, hurting national oil output and Colombia's image.

Ecopetrol President Javier Gutierrez told Reuters on Tuesday that the company had lost an average of nearly 11,000 barrels of oil per day (bpd) in the first half of 2012 from attacks on oil infrastructure by leftist guerrillas.

In the second quarter, group output -- including operations in Brazil, Peru and the U.S Gulf Coast -- rose 4.8 percent to 762,200 boepd from the same period last year, lower than expected by analysts.

Ecopetrol's shares dropped 2.3 percent on Wednesday after it announced that consolidated net income fell 2.5 percent in the second quarter from a year earlier to 3.65 trillion pesos (US$2 billion), below market expectations.

A decade-long offensive by U.S.-backed Colombian troops has pushed guerrillas deeper into inhospitable jungles and mountains, but rebels still wage bombings and other bloodshed, especially against the oil and mining sectors.

At the weekend, FARC insurgents blew up a section of the 220,000-barrel-per-day-capacity Cano Limon-Covenas oil pipeline, Colombia's second most important line. Earlier this month, rebels killed five oil contractors in the south.

Increased attacks caused month-on-month national oil production to fall in May and June. Last month output dropped 0.2 percent to an average of 934,000 bpd.

Reporting by Jack Kimball; Editing by Gerald E. McCormick and Andrew Hay

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