Petro's Policies Are Decimating Colombia's Natural Gas Industry

Why It Matters

The shrinking gas supply threatens Colombia’s energy security and inflates household and industrial costs, jeopardizing economic stability. Policy‑driven investment retreat limits the country’s ability to meet rising electricity demand and could deepen fiscal pressures.

Key Takeaways

• Proven gas reserves fell to ~2 TCF, 5.9-year life
• New exploration ban and higher taxes deter foreign investors
• LPG imports rose 150% YoY, driving price spikes
• Associated gas reinjection consumes up to 80% of output
• Sirius project aims 6 BCF output by 2030, $5B cost

Pulse Analysis

Colombia’s natural‑gas crisis is rooted in a decade‑long erosion of reserves, now down to roughly one‑third of 2012 levels. While production peaked at 1.1 billion cubic feet per day in early 2020, mature fields are experiencing steep decline rates and a large share of associated gas is being reinjected to sustain oil output. Simultaneously, Petro’s left‑leaning agenda—intended to phase out coal—has introduced a moratorium on new exploration licences and heightened fiscal levies, prompting major international operators to scale back or exit the market altogether.

The immediate fallout is a dramatic reliance on imported liquefied petroleum gas. LPG volumes jumped from 36.3 BCF in 2023 to 94.3 BCF in 2024, and 2025 imports reached 153.9 BCF, a 1.6‑fold increase year‑over‑year. This import surge has translated into steep consumer‑price index hikes, with Bogotá’s gas price up nearly 17% in December 2025. Higher input costs ripple through power generation, manufacturing, and low‑income households, amplifying inflationary pressures already straining a fragile fiscal backdrop.

Looking ahead, the Sirius offshore project offers a potential lifeline, targeting 6 BCF of gas by 2030 at an estimated $5 billion investment. Yet the field alone cannot close the projected 56% demand‑supply gap by 2029. Restoring confidence will likely require policy recalibration—re‑opening exploration windows, offering tax incentives, and ensuring regulatory stability—to attract the capital needed for new discoveries and field development. Without such adjustments, Colombia risks entrenched energy imports, persistent price volatility, and a weakened competitive position in the regional energy market.