The second round of the presidential election will not only define who will occupy the Casa de Nariño for the next four years. It could also set the course for Ecopetrol, the country’s most important company, responsible for a significant portion of the Nation’s fiscal revenue and one of Colombia’s main strategic assets.
This is according to a recent analysis by BTG Pactual, which examines the changes that a new administration could drive to strengthen the state oil company’s value generation. The document warns that Ecopetrol faces structural challenges ranging from operational efficiency and investment discipline to the need to redefine its growth strategy and improve its corporate governance.
“A change in administration could represent a significant turning point for Ecopetrol,” BTG Pactual states in the report, in which it identifies ten levers capable of improving the company’s financial, operational, and stock market performance.
As is known, Ecopetrol is not only the largest energy company in the country, but also a key source of taxes, royalties, and dividends for public finances. In addition, it controls ISA, the largest electricity transmission platform in Latin America and one of Colombia’s most strategic infrastructure assets.
One of the first challenges identified by BTG is to recover efficiency in oil operations. Although the company managed to reduce the total cost of hydrocarbon production during the first quarter of 2026, lifting or extraction costs continued to increase.
According to the analysis, the extraction cost reached 12.2 dollars per barrel in the first quarter of this year, compared to 11.3 dollars recorded a year ago. The investment bank highlights that these levels are still above the historical averages observed between 2014 and 2022, when they were around 8 dollars per barrel.
Reduce tax burdens
A second front corresponds to investment management. BTG believes that Ecopetrol has room to improve capital allocation and prioritize projects with higher returns.
The report highlights that investment per barrel produced reached close to 12.9 dollars in 2025, a figure higher than the average of around 10 dollars observed between 2019 and 2024. For analysts, returning to these historical levels could generate nearly 1,000 million additional free cash flow after interest and raise the expected cash yield for 2026 from 9.4 to 12.8 percent.
The tax burden also appears among the main concerns. BTG argues that an eventual review of the tax measures applied to the oil sector could significantly improve Ecopetrol’s competitiveness.
The analysis recalls that the 2022 tax reform introduced a variable surcharge for oil companies that can raise the effective tax rate to close to 50 percent when international crude prices remain high.
For 2026, BTG estimates that Ecopetrol will have to assume a total tax burden of close to 11.3 trillion pesos, of which about 2.5 trillion would correspond solely to the surcharge applied to the hydrocarbon sector.
Increase in reserves
Another central point of the report is the possibility of developing unconventional resources in the Middle Magdalena Valley, a region that, according to estimates cited by the International Energy Agency (IEA), harbors about 4.6 billion barrels of technically recoverable oil and 18 trillion cubic feet of natural gas.
If this potential materializes, Colombia could more than double its current oil reserves and multiply its gas reserves by nine. However, pilot projects remain suspended and any progress will depend on regulatory, environmental, and social decisions.
BTG also considers it urgent to resolve the problem associated with the Fuel Price Stabilization Fund (FEPC), which has generated significant pressure on Ecopetrol’s finances.
According to its calculations, if international oil prices remain high and no adjustments are made to diesel prices, the fund’s deficit could increase from 3 trillion pesos in 2025 to between 10 and 12 trillion pesos in 2026. This would be equivalent to between 18 and 22 percent of the company’s expected Ebitda.
“Resolving the FEPC imbalance represents one of the clearest opportunities to strengthen Ecopetrol’s cash generation,” the report concludes.
Asset sale
The simplification of the business portfolio constitutes another of the topics analyzed. BTG suggests that an eventual partial or total sale of assets such as Cenit or ISA could free up significant resources and strengthen the financial balance.
The bank’s estimates suggest that Cenit could be valued between 19 billion and 24 billion dollars, while ISA would have a similar valuation range. Analysts point out that a single strategic transaction could generate resources equivalent to several years of revenue from a tax reform.
The report also proposes expanding partnership schemes with other companies to develop mature fields, reducing capital needs and sharing risks. As examples, it mentions recent agreements with Gran Tierra and Parex to finance recovery programs and investments in productive assets.
However, one of the changes that the market would follow with greater attention would be related to corporate governance.
Political shielding
BTG believes that a new administration could reduce political influence over business decisions, strengthen control mechanisms, and refocus on profitability, operational execution, and value creation for shareholders.
“A leadership transition could strengthen corporate governance standards, improve accountability, and refocus the company on profitability and shareholder returns,” the analysis states.
The bank also identifies opportunities for Ecopetrol to regain its place in major international stock market indices, which would help increase stock liquidity and attract new institutional investors.
Finally, it suggests that the oil company could resume a more active international expansion strategy, taking advantage of opportunities in more productive basins such as the Permian in the United States, as well as future selective acquisitions that allow compensating for the decrease in reserves in Colombia.
Despite this, BTG warns that a large part of these initiatives will depend on the priorities of the next Government, the execution capacity of the administration that takes over the company, and the regulatory clarity offered to the market.
“The magnitude and timing of any valuation will depend on execution, regulatory clarity, and the credibility of future management and public policy decisions,” the report concludes.
For analysts, Ecopetrol has multiple tools to strengthen its value and regain attractiveness for investors. The unknown is whether the new political cycle that will begin after the elections will be willing to use them.