Ecopetrol S.A. announces the prepayment of its local and international short-term financing contracts

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Rhea-AI Summary

Ecopetrol S.A. (BVC: ECOPETROL; NYSE: EC) announced the prepayment of its short-term obligations totaling COP 775 billion in local debt and USD 221.5 million in international debt. This strategic move is made possible by improved market prices and cost optimization efforts. The prepayments aim to reduce financial expenses, enhance leverage metrics, and showcase the company's commitment to cash efficiency and capital discipline. As Colombia’s largest firm, Ecopetrol plays a critical role in oil production and is expanding its bio-fuel share.

Positive

Reduction of financial expenses through prepayment.
Improvement in leverage metrics.
Enhanced cash efficiency and capital discipline.

Negative

None.

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09/14/2020 - 09:55 PM EDT

BOGOTÁ, Colombia, Sept. 14, 2020 /PRNewswire/ -- Ecopetrol S.A. (BVC: ECOPETROL; NYSE: EC) reports that it will prepay its short-term obligations with local and international banks entered into in March and April 2020, in the form of trade finance instruments and short-term bank loans.

The total principal to be prepaid amounts to COP 775 billion (in respect of the local debt) and USD 221.5 million (in respect of the international debt), plus accrued interest.

The aforementioned prepayments are possible thanks to the improvement in prices observed in recent months, and the progress in cost optimizations implemented to guarantee Ecopetrol Business Group's financial sustainability and to preserve its value promise in the medium and long term.

The prepayment reduces financial expense, improves leverage metrics and confirms Ecopetrol's commitment to cash efficiency and capital discipline.

Ecopetrol is Colombia's largest firm and is an integrated oil company that is among the 50 largest in the world and the four largest in Latin America. In addition to Colombia, where it generates over 60% of the country's production, it is active in exploration and production in Brazil, Peru and the United States (Gulf of Mexico). Ecopetrol operates the largest refinery in Colombia, most of the country's oil-pipeline and polyduct network, and is significantly increasing its share of bio-fuels. This press release contains statements relating to business prospects, estimates of operating and financial results, and Ecopetrol's growth prospects. All are projections, and therefore are based solely on management's expectations of the company's future and its continuous access to capital to finance the company's sales plan. Achieving these estimates in the future depends on its performance under given market conditions, regulations, competition, performance of the Colombian economy and industry, among other factors; therefore, they are subject to change without prior notice.

For further information, contact:

Juan Pablo Crane De Narváez
Head of Capital Markets
Phone: (+571) 234 5190
Email: investors@ecopetrol.com.co

Media Relations (Colombia)
Jorge Mauricio Tellez
Telephone: + 571-234-4329
Email: mauricio.tellez@ecopetrol.com.co

View original content:http://www.prnewswire.com/news-releases/ecopetrol-sa-announces-the-prepayment-of-its-local-and-international-short-term-financing-contracts-301130638.html

SOURCE Ecopetrol S.A.

FAQ

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What is Ecopetrol's recent financial announcement?

Ecopetrol announced the prepayment of short-term obligations amounting to COP 775 billion and USD 221.5 million.

How does the prepayment affect Ecopetrol's financial health?

The prepayment reduces financial expenses and improves leverage metrics.

When did Ecopetrol announce the prepayment of its debts?

The announcement was made on September 14, 2020.

What enabled Ecopetrol to make this prepayment?

The prepayment was enabled by improved market prices and cost optimization.

Which debts is Ecopetrol prepaying?

Ecopetrol is prepaying local and international short-term debts.

Ecopetrol S.A. announces the prepayment of its local and international short-term financing contracts