Frontera offloads Colombia power interest

Frontera Energy has entered into an agreement to sell its interest in Colombian power company Petroeléctrica de los Llanos (PEL) to an affiliate of Eléctricas de Medellín Ingeniería y Servicios.

PEL operates a 260km transmission line with 192MW of authorized electricity demand which supplies power to the Rubiales and Quifa oil fields and the Oleoducto de los Llanos (ODL) pipeline.

"The disposition of PEL is not expected to result in any material change to the power consumption costs for the company at Quifa or for the ODL," Frontera said in a statement. The size of the stake was not disclosed.

The Canadian company added that it will use US$50mn from the US$56mn sale for the first payment to the IFC and related parties for the previously announced purchase of shares in Pacific Midstream.

The transaction is part of Frontera's divestments of non-core assets which in the past 12 months have resulted in approximately US$148mn of cash proceeds, a reduction in exploration or environmental commitments of around US$147mn and the elimination of approximately US$52mn in stand-by letters of credit commitments.