Ecopetrol S.A. (NYSE:EC) Q2 2023 Earnings Call Transcript

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And as you’ll see in the document, the contingent resources that the government mentioned are around 4.2% as costing the most likely scenario, which is recognized as to see resources. In the control numbers, we are close to 3.94 CTFs, so there’s full alignment. The government includes some volumes that are from third-party producers that are not part of the Ecopetrol Group. In addition to these contingent resources, we have the perspective resources that we had in the Ecopetrol Group a month to participate in a topless subject in which we all recognized we need to invest more in gas than the potential access primarily in the Caribbean offshore base. And then that’s why we are conducting such an important activity in this basin. With this, the country needs to manage this uncertainty, and the way to do that is through options because all these volumes have certain challenges for development and that’s why the government and us are working on options to cover this possible gap that we could have in the short-term true options of imported gas as technologies of micro LNG or using the capacity of reification that are already existing Columbia.

Other additional sources. The name of the game is having optionality to make sure that Colombia will have gas and for Ecopetrol to do it in a profitable manner. Thank you, Catherine and I hope this will help you understand. The way we see it right now, the document that have been promised recently.

Unidentified Analyst: Thank you.

Operator: The next question comes from Daniel Guardiola from BTG. The floor is yours.

Daniel Guardiola: Thank you. Good morning Ricardo. May I have a couple of questions? The first one is about the production of unconventional oil. Considering that without any doubt that type of reservoir or production has been one of that has yield had good yields for Ecopetrol, and I would like to know if you could share with what is the expectation of production for the closeout year and what is the CapEx that you plan to allocate for the next two years? That’s my first question. But also, I would like to know if you see any risk of interference by the Colombian government to change this development that’s already planned for the production basically the Permian basin. And my second question has to do with ISA. Recently there was a shareholder’s assembly where some modifications in the Board of Directors were made and I would like to know if you are considering any changes in the management of ISA. Those are my two questions.

Alberto Consuegra: Daniel good morning this is Alberto Consuegra. With respect to unconventional production, I can say that Permian continues to be a very profitable asset where we have all of our focus and expectations. Production for the first half of the year has been very good and the perspective for the rest of the year is between 62,000 and 65,000 barrels of oil equivalent. The good news is that we continue with significant activity and we hope we will end up with 110 drilled wells, where we already have wealth in Delaware. We already have additional activity in Delaware in addition to Midland. So, this will be about $1,200 million this year with the perspective of investment similar for next year. So, Permian is a source of, for focus for all of our focus and as we have stated, it’s a highly profitable asset with EBITDA margins that exceed 70%.

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