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Colombian state controlled energy company Ecopetrol S.A. has announced its investment plan for 2010, totalling $6.93 billion, an increase of 11% compared to 2009.

93% of the proposed investment will be concentrated in Colombia, with the remaining 7% earmarked for exploration and production projects in the U.S. Gulf Coast, Brazil & Peru.

Investments in exploration and production represent 65% of the total capital investment plan for 2010, of which 51% will be allocated to production.

“The 2010 investment plan represents another milestone in achieving the goals we have set for 2015. Significant progress has been made in exploration and production, delivering on the promise of value we made two years ago.” said Ecopetrol’s CEO Javier Gutierrez Pemberthy. ”Investments made in other segments of our business will begin to show additional results starting in 2010. We have managed to gain efficiency in the consolidation of our portfolio and the allocation of resources to more productive investments in order to reach our production goal of one million barrels”

Exploration & New Business

With $951 million investment in 2010, Ecopetrol (EC) plans to drill twenty exploratory wells, thirteen directly in Colombia & a further seven overseas with partner companies. Four wells will be drilled in the Gulf of Mexico, two in Brazil and one in Peru. 54% of the investment will take place in Colombia.

Ecopetrol intends to continue its activities in the blocks awarded by the National Hydrocarbon Agency during the various rounds that took place in 2008, and will prepare its participation for the 2010 Colombia Round.

New business will focus primarily on development of exploration projects in the U.S. Gulf Coast, as well as in Peru and Brazil, in partnership with other companies.

Production

Ecopetrol will invest US$3.558 billion in continuing to increase its direct production of crude oil & gas to an average of 556,000 boed in 2010. This production goal reflects an increase of 12% compared with 2009, in line with the company’s growth target; one million barrels of oil equivalent per day in 2015.

The highest percentage of investment will be allocated to the Llanos Orientales projects, specifically for development of heavy crude in the Castilla, Chichimene & Rubiales fields. A representative percentage will be invested in the development of mature fields such as La Cira-Infantas, Yarigui-Cantagallo & Casabe. US$400 million will be allocated to gas projects, of which 70% will be assigned to the Cusiana and Cupiagua plants.

Refining and petrochemical

Total investment in this segment is estimated to be US$1.294 billion, up 59% compared to 2009 & will mainly address the continued upgrading of existing refinery operations.

In 2010, Ecopetrol plans toinvest $679 million to be divided among upgrades, the industrial services master plan & the construction and start-up of a hydrotreatment plant in Barrancabermeja. A further $470 million has been earmarked for the Cartagena Refinery Master Plan, which should expand the plants production capacity to 140,000 barrels a day

Transport

A further $735 million investment has been set aside for transport & logistics upgrades, primarily to boost capacity at the Pozos-Galan system from 18 MBD to 60 MBD & alos to improve the Andean Pipeline.

Other Investments

Ecopetrol has assigned US$387 million to other investments, of which (i) US$25 million will be allocated to energy diversification projects, among them the Ecodiesel plant in Barrancabermeja, which will use palm tree oil, and (ii) US$105 million will be allocated to information technology & research studies to be conducted by the Colombian Petroleum Institute.