Ecopetrol Posts Strong H1 2025 Results With Record Output

Ecopetrol S.A. (BVC: ECOPETROL; NYSE: EC) reported solid financial and operational performance for the second quarter and first half of 2025, achieving its highest semiannual production since 2015, advancing cost efficiencies, and strengthening its energy transition portfolio.

The Colombian state-controlled oil company delivered a record average production of 751,000 barrels of oil equivalent per day (boepd) in H1 and 755,000 boepd in Q2, driven by growth in the Caño Sur and CPO-09 fields and U.S. Permian operations. It also cut lifting costs below $12/bbl through operational and energy efficiency measures, a target it aims to maintain through year-end.

Operational and Energy Transition Progress

Transport volumes averaged 1.088 million barrels/day, while refining runs reached 405,000 barrels/day after maintenance completions and operational upgrades. Ecopetrol deepened its clean energy push with the full acquisition of the 205 MW Windpeshi wind farm in La Guajira and initiated Colombia’s first long-term LNG import sales contracts, totaling 60 GBTUD over four to five years.

Investment and Efficiency Drive

H1 2025 investments reached $2.85 billion, 86% allocated to growth and long-term value creation. Geographic distribution was 62% in Colombia, 17% in Brazil, 15% in the U.S., and 6% in other regions. Efficiency programs delivered COP 2.2 trillion in benefits, exceeding targets by 27%, with 80% of the annual cost-reduction plan achieved by June. The company advanced 56% toward its $500 million CapEx flexibility goal and implemented measures to bolster liquidity, including COP 7.6 trillion in early FEPC collections and $935 million in currency hedges.

Financial Performance

Ecopetrol posted an EBITDA margin of 38% for Q2 and 40% for H1—above industry peers—despite a 22% drop in crude prices. Net income for Q2 was COP 1.8 trillion, which would have been COP 3.2 trillion absent adverse external factors such as weaker oil prices, inflation, and new taxes. H1 net income totaled COP 4.9 trillion. Leverage remained below targets, with gross debt-to-EBITDA at 2.4x (1.7x excluding subsidiary ISA) and net debt-to-EBITDA at 2.2x (1.6x excluding ISA). Free cash flow stood at COP 3.1 trillion, with total cash at COP 13.1 trillion by June’s end.

Challenges and Sustainability Commitments

External headwinds included lower oil prices, currency volatility, inflation, and domestic disruptions such as infrastructure blockades. ISA’s results were pressured by Brazilian tariff adjustments and portfolio deterioration at subsidiary AIR-e. On the sustainability front, Ecopetrol invested COP 180 billion in territorial development, paid COP 8.8 trillion in dividends (10% yield), reduced GHG emissions by 242,000 tonnes CO?e—132% above target—and reused 44 million cubic meters of water, covering 82% of operational needs.

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Outlook

For H2 2025, Ecopetrol plans to save COP 1 trillion in costs, generate over COP 5 trillion in efficiencies, and maintain lifting costs under $12/bbl. The company will continue optimizing working capital to meet its COP 2 trillion annual target and pursue disciplined capital allocation to capture full CapEx flexibility. Management emphasized resilience, adaptability to market conditions, and long-term value creation for shareholders and communities.

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