Ecopetrol Sa · BVC:ECOPETROL
Ecopetrol Sa — Q1 2023 Earnings Presentation
25 slides from Ecopetrol Sa's earnings presentation, May 10, 2023
Slide 1: First Quarter
First Quarter
Slide 2: Legal disclosure
Legal disclosure This document was prepared by Ecopetrol S.A. (the “Company” or “Ecopetrol”) with the purpose of providing the market and interested parties certain financial and other information of the Company. This document may include strategy discussions and forward-looking statements regarding
Slide 3: Speakers
Speakers Ricardo Roa Barragan Chief Executive Officer Diana Escobar VP Sustainable Development Maria Paula Camacho VP of Corporate Affairs and Secretary General Yeimy Baez VP of Low Emission Solutions Alberto 7 Consuegra Jaime Caballero Chief Operating Chief Value Officer Officer
Slide 4: Ecopetrol Group's strategy responds to the challenges of energy transition
Ecopetrol Group’s strategy responds to the challenges of energy transition Energy Trilemma in Colombia 2040 Strategy Availability GROW WITH THE ENERGY TRANSITION COMPETITIVE RETURNS Fiscal GENERATE VALUE THROUGH TESG Balance Environmentally Accessibility CUTTING-EDGE Responsible KNOWLEDGE 2023 Plan
Slide 5: A strong start: outstanding quarterly results amid a challenging environment
A strong start: outstanding quarterly results amid a challenging environment 712 701 728 735 676 692 719 55 67 64 51 61 98 82 COP T 24.4 approved dividends 48.8% 49.0% COP 593 per share. Highest dividend 46.1% 47.6% 43.5% 45.9% in history. 34.9% 38.9 25% Dividend Yield* 32.5 Decarbonization New comm
Slide 6: Adapting to a changing market
Adapting to a changing market Exports and Imports Opportunities kbped 558 523 518 459 457 • OPEC+ cuts support basket prices • China reactivation: Ecopetrol Trading Asia 196 179 174 180 153 • Europe substituting Urals crude: Vasconia and Castilla • Changes in contract structures 1Q22 2Q22 3Q22 4Q22
Slide 7: TESG
Slide 8: Ecopetrol is a key player in Colombia's socioeconomic development
Ecopetrol is a key player in Colombia's socioeconomic development A C C E S S TO N AT U R A L GAS SERVICE Q U A L I T Y, C O V E R A G E A N D More than 11,500 families SCHOOL RETENTION connected to Natural Gas in Barranquilla and Arauca • Programs: 'Ecopetrol Educa', 'Bachilleres Department Ecopetr
Slide 9: Governance and corporate responsibility
Governance and corporate responsibility General Shareholders Ordinary meeting Meeting • Face-to-face session at CORFERIAS Approval of the Annual • Electronic Voting Corporate Governance Report First Carbon Neutral Meeting with • Attendance of 3,590 shareholders and and the Integrated Management more
Slide 10: Low Emission Solutions
Slide 11: Boosting gas and new energies for Colombia's benefit
Low Emissions Solutions Boosting gas and new energies for Colombia’s benefit Natural Gas New Energies Social 267 MUSD Solar Rubiales Solar farm (100 MW): Signed agreement Social Gas & LPG 2,379 with Total Eren for construction EBITDA Gas & LPG* Emissions reduction : 6.417 tCO2 (+127% vs 1Q22) 59% Sa
Slide 12: Hydrocarbons
Slide 13: Making progress in the exploratory campaign
Exploration Making progress in the exploratory campaign Exploratory Successes* Arrecife Norte-1 Tororoi-1 Arrecife Norte-1* Gas Success Crude Success 2023 Drilling Campaign VIM-8 Appraisal 8 Drilled Wells Dry Piedemonte foothill: 2 Seismic 2023 Seismic 2023 Eastern Plains – Llanos Orientales: 6 Flam
Slide 14: Production: Robust and sustainable results
Production Robust and sustainable results Outstanding contribution from Permian Crude Gas + White products Permian Average Monthly Production 57.4 55.7 704.6 720.5 720.1 719.4 ECP before royalties (mboed) 692.1 47.4 First lateral 18,000 ft wells 166.7 175.2 166.1 171.7 drilled and successfully 163 c
Slide 15: Logistical excellence addressing demand requirements
Midstream Logistical excellence addressing demand requirements Transported Volume Cabotage operation - support for fuel supply in +4.7% the south of the country: 1,041.0 1,077.4 1,074.8 1,089.2 1,090.2 MBD 283.5 298.3 304.8 305.6 306.3 Cabotage from the Buenaventura . Maritime Terminal to the Tumaco
Slide 16: Operational efficiency that enables an increase in clean fuels
Downstream Operational efficiency that enables an increase in clean fuels Gross Refining Margin and Throughput Financial Performance Fuels Production (mbd) 29.0 25.0% 22.6 15.1% 14.3% 302 20.0% 20.3 19.9 9.6% 9.1% 286 13.9 8.5% 15.0% 257 10.0% 224 31 228 34 3,237 5.0% 31 0.0% 29 110 26 117 3,685 109
Slide 17: Ongoing efficiency capture and cost optimization
Costs Ongoing efficiency capture and cost optimization 1Q23 EFFICIENCIES COP 905.4 billion ✓ Cumulative efficiencies of COP 23.4 trillion (2015-2023). ✓ Main levers with impact on EBITDA: 108 • Continuation of heavy and extra heavy crude dilution initiatives 191 • Subsurface maintenance - reduction
Slide 18: Energy Transmission & Toll Roads
Slide 19: On the path to profitable growth
Transmission and Toll Roads On the path to profitable growth BUSINESS LINE CONTRIBUTION 1T23 (COP T)* OPERATING MILESTONES GE without Transmission and Toll Roads Transmission and Toll Roads Contribution Award of 13 red extensions in Total Ecopetrol Group Brazil and 8 connections in Brazil, Colombia
Slide 20: Balanced Scorecard
Slide 21: Outstanding results despite changes in market environment
Outstanding results despite changes in market environment Ecopetrol Group’s Indicators 1Q23 ROACE1 EBITDA Margin2 EBITDA by Business Line Hydrocarbons Transmission and Toll Roads 18.8% 17.8% Low-Emissions Solutions 49.0% 45.9% 14.5% 40.3% 6% 5% 7% 12% 12% 15% 82% 83% 78% 1Q22 4Q22 1Q23 1Q22 4Q22 1Q2
Slide 22: Strong financials aligned with investment grade
Strong financials aligned with investment grade* Cash Balance (COP T) 2023 Debt Management (USD M) 4,523 ECA 2.1 5.2 Intl. Credits 18.1 0.7 USD 2.2 0.2 17.7 Intl. Bonds 2,860 M Local Bonds 1,663 USD 2,000 M international bond issuance Balance Operating Capex Debt Dividend Exchange Balance 1Q22 1Q23
Slide 23: TESG in support of long-term value creation
TESG in support of long-term value creation Strategic 1Q23 Results 2023 Ta r g e t Commitments Plan Real Projection T SCIENCE, TECHNOLOGY AND INNOVATION ST+i Value Generation (USD M) 168.3 176.9 2,9501 TESG accelerator CLIMATE CHANGE Cumulative GHG reduction against 2019 baseline (MtCO2e) -0.97 -0.9
Slide 24: In summary…
In summary… • Strong 2023 start, plan remains on track • Progress towards the energy transition and in line with the pillars of the 2040 Strategy • Creating value for our shareholders, employees and the communities with whom we work on a daily basis in our operation • Many opportunities going forwar
Slide 25: Q&A