Benefiting Colombia and Casanare
Improvement to key social indicators
Our uninterrupted presence in Colombia during two decades has been definitive in terms of contribution both to nation and region. Steady oil and gas production from BP-operated fields in Casanare, coupled to favourable royalty legislation, came together to generate significant revenues that have been invested by national, departmental and municipal authorities to improve the living conditions of thousands of citizens.
In effect, according to Colombian law and the type of association contract that BP currently has active with state-partner Ecopetrol, production is distributed as follows:
* 40% Ecopetrol
* 40% Private parties (Colombian or foreign)
* 20% Royalties
In turn, the above 20% royalty share is paid out according to the following distribution scheme:
*47.5% Producing department (direct royalty)
*12.5% Producing municipality (direct royalty)
*32% National Royalty Fund (indirect royalty)
*8% Port municipalities (direct royalty)
* 40% Ecopetrol
* 40% Private parties (Colombian or foreign)
* 20% Royalties
In turn, the above 20% royalty share is paid out according to the following distribution scheme:
*47.5% Producing department (direct royalty)
*12.5% Producing municipality (direct royalty)
*32% National Royalty Fund (indirect royalty)
*8% Port municipalities (direct royalty)
As a result of this distribution format, between 1993 and 2007 the department of Casanare and its municipalities received over 2.7 billion dollars (a majority portion of which was BP-produced) that have helped finance the region's visible transformation along with the improvement of key social indicators. It is in this sense that our operations, and the night and day work of hundreds of men and women, have been instrumental in helping to change the region and improve the lives of our Casanare neighbours
In addition to royalties, from 1996 to date, BP has paid over 1.2 billion dollars in taxes to Colombian coffers, making it one of the Nation's largest taxpayers.
And between 1992 and 2002 alone, the Colombian State received 8.6 billion dollars from Cusiana and Cupiagua production, while preliminary estimates indicate a State Take of over 12 billion dollars through 2007.
It is important to note that when totalled, the Colombian State collects roughly 85% of oil production activities. This percentage includes Ecopetrol's share and the payment of royalties, taxes and customs duties.
In addition to royalties, from 1996 to date, BP has paid over 1.2 billion dollars in taxes to Colombian coffers, making it one of the Nation's largest taxpayers.
And between 1992 and 2002 alone, the Colombian State received 8.6 billion dollars from Cusiana and Cupiagua production, while preliminary estimates indicate a State Take of over 12 billion dollars through 2007.
It is important to note that when totalled, the Colombian State collects roughly 85% of oil production activities. This percentage includes Ecopetrol's share and the payment of royalties, taxes and customs duties.
Over the past 20 years, direct BP investment in wells, processing facilities, wells and oil and gas transport pipelines amounts to over 2.8 billion dollars, a part of which has gone to pay local hire, goods and services.
The stable conditions for doing business in Colombia have acted as an incentive for continued BP investment, hence our interest in exploring the Caribbean. But more importantly, our commitment and belief in Colombia have been mirrored by other foreign investors, which have increasingly flocked to the country as a sound business destination, surge that in 2007 alone produced over 7.4 billion dollars in net direct foreign investment.
BP has played a key role in helping to produce the funds needed by national, regional and local authorities to spur development and bring about changes in urban and rural sectors.
The stable conditions for doing business in Colombia have acted as an incentive for continued BP investment, hence our interest in exploring the Caribbean. But more importantly, our commitment and belief in Colombia have been mirrored by other foreign investors, which have increasingly flocked to the country as a sound business destination, surge that in 2007 alone produced over 7.4 billion dollars in net direct foreign investment.
BP has played a key role in helping to produce the funds needed by national, regional and local authorities to spur development and bring about changes in urban and rural sectors.
