The Colombian energy sector faces a critical scenario, characterized by a growing gas deficit, declining hydrocarbon reserves, and increasing dependence on imports. During the 8th Oil, Gas and Energy Summit in Cartagena, sector leaders and international experts analyzed the immediate and strategic challenges facing Colombia in its transition towards a more sustainable energy matrix.
On the other hand, the president of the Colombian Oil and Gas Association (ACP), Frank Perle, warned that the expected gas deficit for next year could reach nearly a quarter of national demand. As he said: “We have seven years of oil reserves and almost six years of gas reserves, and this is a very low number. Activity in this sector has declined in recent years. This year we imported approximately 17% of the national gas demand and next year we will import 25%.”
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Pearl stressed the urgent need to review the regulatory framework and encourage new investments to reverse this trend Maintaining the sector’s overall economic and financial contribution, which represents 16% of foreign direct investmentcontributes $8 billion in royalties and more than 20% of the nation’s income.
Meanwhile, the Executive Director of the Colombian Association of Petroleum Geologists and Geophysicists (Acggp), Flover Rodríguez Portillo, stressed that the debate on the future of energy must include the public and private sectors as well as local communities. “Exploration is not just a technical issue. It is an issue of state, planning and energy security,” he said. Likewise, the Director insisted that knowledge of the territory is essential for its proper protection and management, and that resource exploration can be compatible with environmental protection and social development, as long as it is done under solid regulatory frameworks and with community participation.
In view of this, InfoBay Colombia I spoke with Managing Director and Senior Partner of BCG Consulting, Alvaro Martinez de Borio, who analyzed the challenges, opportunities and strategies the country must consider to ensure energy security and progress in the transition. The expert stated that Colombia’s energy transition involves balancing the three peaks of the so-called “energy trilemma”: security of supply, energy affordability, and sustainability.
“If we focus only on environmental sustainability, for example, By betting only on clean energy, we can jeopardize energy security and affordability“, to caution.
He cited the European case after the war in Ukraine, where reliance on Russian gas and the elimination of other sources led to a sharp rise in energy prices. For the consultant, the transformation must advance at a pace that allows for ensuring supply, keeping prices affordable and, at the same time, moving towards a cleaner matrix. Although Colombia already has a mostly clean generation matrix, it faces challenges such as gas shortages and increasing dependence on imports.
At the same time, he highlighted that the reliability of Colombian electricity supply depends largely on gas, given that the national energy matrix relies mainly on hydropower, a clean and cheap source but subject to climate fluctuations.
“There has always been a need for a backup energy source, which has traditionally been gas.” He said. After blackouts in the 1990s, Colombia invested in thermal power generation, but gas is currently scarce and no improvement is expected in the short term. The specialist pointed out that the solution is to ensure larger quantities of gas at reasonable prices, which means planning to combine imported gas with new developments and natural gas. outside. Although gas will not be as cheap as it was before, the goal is to maintain affordability and, in parallel, expand the participation of renewable energies, which require support due to their intermittency.
In response to a question about the role of hydrogen in decarbonizing sectors such as mining and transportation, Martinez de Borio said: It should be considered an option within a broader technology stack.
“Green hydrogen, which is produced 100% with renewable energy, so far shows no signs of being economically competitive in the short term.” He said. Although he believes it makes sense to further explore its potential, he cautioned that hydrogen is unlikely to be the only solution or as promising as was thought a few years ago. For him, agile transformation means keeping different technological options open and not betting everything on one alternative.
The Managing Director and Partner of BCG Consulting also identified digitalization and artificial intelligence (AI) as transformative factors for the efficiency and competitiveness of the Colombian energy sector. “The impact will be transformative,” he added. He said that the first wave of digitalization, based on real-time information and data for decision-making, has already brought about significant changes in the past decade. Now, the arrival of AI and generative AI promises to enhance efficiency, productivity, and flexibility, especially in the context of low prices.
He stressed that the difference between future companies will lie in who will adopt these technologies effectively and who will not. However, he warned against this “Many companies invest without getting results.” Therefore, it is essential to choose use cases well and have a clear action plan to implement them.
Regarding attracting investments in sustainable energy projects, he recommended ensuring legal security and institutional clarity, as well as effective formulation of public policy in the energy sector. “Generation, transmission and public policy must be coordinated. If there is no clarity on incentives, licensing or infrastructure, projects are delayed and the equation does not close.” He explained.
He stressed that generation alone cannot be promoted if transmission is not ready or if there is no regulatory clarity, and that a comprehensive vision for energy development is needed. Moreover, he considered it a mistake to think of the development of renewable energy sources as an isolated process.