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​​​ To grow in a profitable and sustainable manner, in line with the expactations of our shareh​olders


Economic performance​​


To foster the expected yield and sustained growth by effectively identifying opportunities and a management of investments and funds that is in line with risk levels.
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A high level of economic performance is a priority for Promigas, so that it can meet its commitment to reimburse its shareholders and interest groups adequately and consolidate the position it holds and which identifies it as an energy holding company in Colombia and the rest of Latin America.  

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To build society, we seek financial excellence through a sustainable growth model which adds value for our shareholders and all interest groups. Our target is always to achieve our strategic objectives and to consider the economic and regulatory context in each of the sectors or markets in which we operate. 

Our management focuses on improving profitability and growth, on maintaining a sound financial position and stable liquidity, and on achieving regulatory visibility and efficiency in order, on the one hand, to offer shareholders an attractive and sustainable reimbursement and, on the other, to be a leader in gas transportation and distribution and in the distribution and marketing of gas and electricity.​


 

Economic environment

Due to slower growth in both advanced and emerging economies, 2019 witnessed a downturn in the world economy, compared to the previous year. 2019 was marked by the trade war between China and the United States, Boris Johnson’s victory in the general elections in the United Kingdom, social tensions in Latin American countries and a generalized strengthening of the dollar, all of which have led to a fall in economic growth expectations for 2020 and 2021. 

2019 saw a downturn in the United States economy, the driving force for which continues to be household consumption, since it has been the base for constant growth in recent years. This consumption increased even in 2019, a year when business investment weakened, exports faced strong headwinds, and housing stagnated. 

However, this behavior is not surprising if it is remembered that the unemployment figure, which has been very low in the last fifty years, ended 2019 at 3.4%. In monetary policy terms, the Federal Reserve continued the adjustment cycle that began in 2015 and continued until the summer of 2018. The high level of uncertainty, the downturn in business investment and the recession in the manufacturing sector, combined with low inflation, convinced members of the Federal Reserve Board that monetary policy should have been more expansive. Since then, the FED has increased treasury bond purchases in order to increase reserves and has lowered the target interest rate on three occasions, thereby reversing almost all of the 2018 increases, and it closed 2019 in the 1.50% - 1.75% range. ​

The twelve-month inflation figure remained within the Banco de la República target range of 2% - 4% during 2019, although it closed the year at 3.80%, which was higher than the central goal. This behavior can principally be explained by the increase in food prices as a result of supply issues and the effect of the foreign exchange pass-through; in other words, the transmission from depreciation to inflation. Despite this, Banco de la República kept the interest rate at the same 4.25% throughout 2019, even when inflation approached the upper limit of the target range. 

Despite the above, the Colombian economy grew by 3.3% during 2019, 70 basic points up on 2018 growth. The sectors behind this growth in GDP were activities related to trade and transportation, public administration and defense, and financial and insurance operations. On the other hand, the sector which limited growth was construction, specifically because of the downturn in the buildings subsector. 

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​Last year, the average international Brent crude price was 10% down on the average for the previous year, mainly due to lower economic growth prospects and the downturn in manufacturing activities, which were partly offset by lower commercial tensions and an expected cut in production by the Organisation of Petroleum Exporting Companies (OPEP). Brent crude began 2019 at USD 54 per barrel, with an upward trend that took it to USD 75 per barrel in April; however, the trend was downwards in the second half of the year, a reflection of weak expansion in the global economy.​


​Against this tense international background, the average Colombian currency exchange rate was COP 3,281, a devaluation of 11% compared to the average for 2018.​


On December 2, 2019, the representative market exchange rate (TRM) for the dollar was COP 3,522.48, the highest figure ever recorded. This behavior was due to uncertainty about the trade war, the downturn in the world economy, the fact that investors were less inclined to take risks, and the increase in the demand for dollars as a safe haven in a context where the United States economy was slowing less than elsewhere, and the FED adopted less accommodating postures than other central banks, such as the European Central Bank or the Central Bank of Japan. Similarly, this can also be explained by the uncertainty over the social protests in the country and the region.

As far as fiscal policy is concerned, on December 27 last, Colombian President Iván Duque passed the Economic Growth Law, which contains measures aimed at continuing to boost growth in the country’s GDP and direct foreign investment. Essentially, the reform presented is the same 2018 Financing Law but with new articles added, notable among which are social measures that will benefit the most vulnerable sectors of the population. The exemptions proposed in the Economic Growth Law could increase the fiscal deficit, and the government therefore is faced with the challenge of increasing tax collections in order to adhere to the fiscal rule and maintain the country’s credit rating.​​


Natural gas consumption in Colombia

In 2019, the average natural gas consumption in Colombia was 970 MMSCFD

The sector with the highest consumption was non-regulated industrial, with a 48% share, followed by thermoelectric (22%), regulated (24%) and VNG (6%). The thermoelectric sector was 3% down, since the non-availability figure for electricity transmission infrastructure in 2018 had been higher and the thermoelectric dispatch figure was accordingly higher, especially by gas plants on the coast. However, residential sector consumption was 3% up, due to growth in new settlements in recent years.    



A figure of over 9.6 million regulated users in the country was reached in 2019. 80% of these users are in the interior, 17% are on the coast, and the remaining 3% in isolated areas. The total number of users rose by 448,797 in the year from December 2018 to December 2019, a 5% increase on the previous year.  ​

Note. Sources: Monthly National Demand and Regulated User Reports (Concentra) and Gas Coverage Report (Ministry of Mines and Energy, 3rd Quarter, 2019).   



Portfolio sustainability and development of new business


Not only do we identify, evaluate and carry out new business opportunities, we also reinforce our current services in order to guarantee our sustainability and ensure that the growth horizons and strategic units defined in corporate Strategic Planning are achieved. 

The target of corporate strategy is portfolio sustainability, and by carrying out new business activities and growing the economic, social and environmental value of existing business, we boost strategy.    ​

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Strategic Transportation Business Group ​


Natural Gas Transportation Companies




PROMIORIENTE

Since it was not significantly affected by any external events, gas pipeline operational stability was maintained, thus enabling it to render a continuous service and generate the revenue budgeted.

Fitch confirmed the AA+ (Col) rating for Promioriente, based on its cash flow stability, the strength of its transportation infrastructure, the stability of its credit metrics and its long-term capital structure, thus enabling it to have high levels of financial flexibility for absorbing contingencies. 

TRANSOCCIDENTE
100% of the capacity contracted by GdO was retained in 2019, with a couple of 100-0 charges, thus guaranteeing the company’s expected revenue level.   
​​ TRANSMETANO

For 2020, Transmetano has succeeded in contracting an additional 106 MMSCFD in total through firm and interruptible agreements. As a result of implementing the new commercial policy, which commenced on January 1, 2020, it proved possible to retain capacities in other modalities with a renewal risk.

The Yarumito deviation was built and commissioned, resulting in the Sebastopol-Medellín gas pipeline now being outside the area affected by mass earth movements in the Aburrá Valley metropolitan area. This deviation enables risks associated with a land instability incident to be mitigated. ​



LNG






SPEC

On a total of 148 days in 2019, SPEC regasified 5,837 MMSCF of gas, in total, which was injected into the National Gas Transportation System on the Atlantic coast. Thus, by meeting thermal requirements and carrying out scheduled and emergency maintenance on electricity infrastructure lines, SPEC has become a fundamental backup for the National Electricity System. 

In the course of the year, SPEC received six LNG ships containing a total of 355,154 m3. LNG is received by means of a ship-to-ship operation, using cryogenic hoses. Operations have been carried out successfully and within the permitted unloading times.  ​​​


Integrated solutions for industry

PROMI​SOL​



​Promisol carried out a successful operation at the Bonga and Mamey hydrocarbon treatment plant, which exceeded the expectations of the customer, Hocol, in terms of the operational availability agreements, which stated 99.34% and an average gas treatment figure of 35 MMSCFD.

As far as energy services were concerned, at the close of 2019 Zonagen had 15 customers connected and 98% of its installed capacity sold, and reported a 2% growth in energy sales. Meanwhile, it continued to honor its operation and maintenance contracts with its customers Ajover, Mexichem and Essenttia in Cartagena. 

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It also made progress on consolidating its construction business, with over 355 km laid, and it led the works involved in the underwater crossing of El Dique Canal. ​​




Strategic Distribution Business Group ​

Related companies in Colombia connected 154,450 new users in 2019, for a total of 3.7 million beneficiaries. They also served 818 towns and villages in the country, as a result of which they had a 38% share of service beneficiaries. 

As far as distribution companies in Peru are concerned, these succeeded in connecting 257,424 users during the year, thus achieving a total of over one million. Cálidda and Quavii together served 37 towns and villages in the country, making for an accumulated total of 1.1 million users in Peru.


Distribución de gas natural

Surtigas

A further seven towns and villages were served, for a total of 185 and a coverage figure of 96% in its zone, with 805,457 users connected by the end of the year. Under an agreement between Canacol and Promigas, a start was made on the Sahagún gasification project, which will benefit a total of 735 homes. 

GdO
During the year, GdO constructed 404 km of network serving 11 new towns and villages, for a coverage figure of 90% and a total of 1,183.55 users. It continued to graduate the distribution charge defined in CREG Resolution 197 of 2017 for its beneficiaries. ​


GASES D​EL CARIBE
​​This company and its affiliates served a further seven towns and villages last year, meaning that they now have a presence in 231 towns and villages in their area of influence, 65 in the Gases de La Guajira zone, and 61 in that of Efigas. By the year-end they had an accumulated total of 1,021,153 users and had increased gas sales to 1,362 Mm3 as a result of better management on the secondary market.​​​

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CÁLIDDA
Cálidda received approval from Osinergmin for the full plan, and the new rate came into force on August 7, 2019. In the course of the year, it connected 7 new towns and villages for a total of 30 and 191,331 new users, making an accumulated total of 952,547.

QUAVII

Quavii met its commitment with the Peruvian Government to connect 87,000 users by the end of the year. It managed to increase its coverage to 45% by virtue of constructing 118,204 new rings, for an accumulated total of 194,130. 

It has 32 tanks for virtual transportation from the plant to regasification stations, eight of them acquired in 2019.

It was awarded the Business Creativity 2019 prize by the Peruvian University of Applied Sciences for operating the virtual LNG gas pipeline for mass natural gas usage in northern Peru. This is one of the most prestigious prizes in the country. ​

 
 

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CEO serves 38 of the 42 municipalities in Cauca province, in southwest Colombia, plus five corporate customers in other regions. A notable feature of its operation is the 51% fall in the public lighting portfolio overdue by more than 90 days and the 1.94% drop in other portfolio overdue by more than 90 days.

CEO developed new installed power business (2,594 MW), achieving results that were 70% up on the previous year, and it also managed to exceed the target set by 34.5%. Similarly, its solar energy generation projects exceeded

370 MWh, with installed power rising from 187 kWp to 583 kWp, a growth figure of over 200%.  ​



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Corporate economic and financial management

FINANCIAL STATEMENTS 
The principal figures on the General Balance Sheet and the Profit and Loss Statement, compared to those presented in 2018, are shown below.  

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At the 2019 year-end, assets were 13% up as a result of investments made in the 100 MMSCFD expansion project and the annual financial asset adjustment due to the updating of macroeconomic and operational variables.

Fixed assets were up as a result of the works carried out during the year at administrative headquarters and pre-operational expenses associated with the evaluation of various expansion projects in progress.

The increase in assets under concession was due to the fact that, in 2019, work continued on significant investments associated with the 100 MMSCFD expansion project 

(Jobo-Majaguas gas pipeline, Mamonal-Paiva 20” and Paiva-Caracolí, and Paiva, Caracolí and Filadelfia compression stations), and also on other investments, such as construction of the HCA deviation in Riohacha, the Mamonal-Paiva 24” gas pipeline, and the El Dique canal crossing.   

The financial asset generated by the transportation concessions reflects the annual adjustment relating to the updating of operational and macroeconomic figures and the weighted average capital cost (WACC).   

Other assets rose because participation method profits of related companies were reported, mainly distribution companies like Surtigas, arising from higher marketing revenue, Gases de Occidente, whose distribution business income rose, higher CEO profits, and Cálidda, where a greater volume was invoiced and also because of the new rate that came into force in May 2018. As far as the gas transportation companies were concerned, notable features were growth at Transmetano due to the greater installed capacity and at Promioriente, due to revenue related to the gas imbalance.  

​​​ ​Total liabilities, mostly in the long-term​ category, were 14% ​up. 

A USD 210 million international bond issue in October provided funds that were used for optimizing our debt payment profile by paying off the USD 125 million syndicated loan and to finance projects in the course of execution, such as the  100 MMSCFD project, and those budgeted for 2020, such as the Banana Zone gas pipeline and the Riohacha and Bonda-Tasajera deviations.

Meanwhile, provisions were reported in December for environmental costs requested by ANLA relating to projects already executed, namely Jobo-Majaguas, San Mateo-Mamonal and Paiva-Mamonal, and an adjustment was made to the 2018 provision for higher environmental costs related to the Paiva compression station.​

The growth in operating revenue was due to higher gas transportation revenue, which increased because of the variation in the average exchange rate and the signing of new, interruptible contracts with Canacol. These counteracted the decline in volumes transported, compared to 2018, a year when consumption increased as a result of attacks on the National Transportation System (NTS) and maintenance work the Coast-Interior interconnection lines.

The construction revenue and cost, which are reported as having the same value under current accounting regulations, was up because of the change in accounting policy, with the result that for 2019 not only capitalizations made are reported but also progress on projects during the year, which was not included in 2018.




Participation method revenue was up in 2019 at the following companies:

Surtigas:  higher marketing revenue, gas business, and the gasification project in the town of Sahagún that was carried out under an agreement with Canacol. 

Gases de Occidente: higher distribution business revenue and participation method revenue due to CEO results. 

Cálidda: increased revenue due to higher volume invoiced and new rate from May 2018. 

CEO: higher distribution revenue and lower costs due to application of IFRS 16.

Transmetano: higher contracted capacity. 

Promioriente:  revenue received due to gas imbalance with Vanti. 


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Costs and expenses were up by 10% as a result of the annual increase in labor expenses, the change in the methodology for calculating the contribution to the Superintendency of Domestic Public Services, which increased the cost base on which the 1% rate applies by including financial expenses, maintenance of the SAP S4HANA administration service that was being reported in the project, and the growth in insurances due to the higher value of assets to be insured.

The increase in depreciation and amortization was due to the capitalization of projects relating to the 100 MMSCFD expansion project.  

Financial asset revenue reflects the annual adjustment for updating macroeconomic variables and the weighted average capital cost (WACC). 

The behavior of other revenue and other expenditure is due mainly to the effect of revaluation / devaluation during the year on the loan and the rental in dollars of the Hocol plant with Promisol, as well as on the USD 125 million syndicated loan paid in October and on the USD 210 million bond issue the same month. Additionally, the difference on exchange on dividends decreed in dollars by Cálidda was reported in May. The higher debt balance in 2019 is reflected in a higher financial expense for the year.           

Income tax was down because of the 40% tax benefit under the legal stability contract applicable to the acquisition of productive fixed assets and the difference on exchange caused by the bonds issued. 

CONSOLIDATED FINANCIAL STATEMENTS  
The consolidated financial statements at December 31, 2019, compared to those presented at December 31, 2018, are given below.  ​

Current assets were 12% up, mainly in Surtigas accounts receivable for higher non-banking financing marketing and placement revenue, at Cálidda due to higher volumes invoiced and the better rate, and at Promigas due to higher invoicing in December.

Assets under concession were up due to the continuing execution of major investments associated with the 100 MMSCFD expansion project (Jobo-Majaguas gas pipeline, Mamonal-Paiva 20” and Paiva-Caracolí, and Paiva, Caracolí and Filadelfia compression stations), and investments made in commissioning Quavii. ​

There was a variation in financial assets generated by virtue of International Financial Reporting Interpretation Committee (IFRIC) accounting regulation 12, which governs the transportation and distribution concession, due to the periodic updating of operational and macroeconomic figures. The weighted average capital cost (WACC), which is used for disconnecting the market value of the gas pipeline at the end of the concession, was also adjusted.  ​



​​ ​Total liabilities, mainly in the long-term category, were 13% up. A USD 400 million international bond issue was carried out in October, in which Promigas had a 52.5% share (USD 210 million) and Quavii ​USD 190 million. These funds were used to optimize the short- to long-term debt profile and to finance both companies´ expansion and current projects in 2019 and 2020, such as the 100 MMSCFD expansion project and those budgeted, namely the Banana Zone gas pipeline and the Riohacha and Bonda-Tasajera deviations. 



​The increase in operating revenue is principally the result of the following:  

Distribution companies: 
Surtigas:  bigger profit in the marketing business, bigger margin in the gas, materials and services businesses, and revenue from the assignment of rights in the gasification project in Sahagún, carried out under and agreement with Canacol and Promigas.

Gases de Occidente:  bigger profit on the distribution business, marketing, rights and financing.

Cálidda: bigger margin in the gas business due to higher volume invoiced and the higher rate that came into force in May 2018, plus the bigger margin in other businesses. 


Transportation companies: 
Promigas: signing of new interruptible contracts with Canacol.   

Transmetano: higher transportation revenue due to greater contracted capacity and index-linking of the rate.

Promioriente:  revenue from the gas imbalance with Vanti.

Promisol: higher gas pipeline maintenance and construction service revenue from projects associated with Canacol 100 MMSCFD: the directed horizontal crossing of El Dique Canal and sections 1 and 2 of the Jobo-Majaguas gas pipeline. 

The behavior of construction cost and revenue is due to the change in accounting policy, with the result that for 2019 not only capitalizations made are reported but also progress on projects during the year, which was not included in 2018. The Canacol 100 MMSCFD project, at Promigas, and investments made by Quavii are notable features of 2019.

The increase in the participation method is due to higher revenue from the gas business at Cálidda, due to the higher volume invoiced, the better rate, which came into force in May 2018, and the bigger margin in other businesses.

Costs and expenses were up in 2019, mainly at distribution companies, as a result of updating the portfolio provision at the year end and the change in calculating the contribution to the Superintendency of Domestic Public Services, which now includes financial expenses.  

Financial asset revenue was up at Promigas and at Surtigas, due to the annual adjustment of macroeconomic and operational variables.

The increase in other revenue and expenditure is due to the difference on exchange generated by assets and liabilities in dollars. In 2019, these related to rental, the dollar loan between Promigas and Promisol, and Promisol financial assets in dollars, and also to the liability from the USD 400 million international bond issue in October for refinancing the Promigas and Quavii debt, in which Promigas has a 52.5% share (USD 210 million). 

Other expenditure also increased because of the higher debt balance in 2019 at Promigas and the aforementioned bond issue at Quavii.

Income tax was down, due to the effect of the 40% tax benefit under the legal stability contract applicable to the acquisition of productive fixed assets. 

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Financial information disclosure and control systems ​




At Promigas, we implement internal controls and procedures for administering business risks, preserving the effectiveness and efficiency of operations, and guaranteeing the reliability and opportunity of the information we present to our interest groups.

We continually check and evaluate the performance and effectiveness of internal controls over financial reports. These evaluations include analyzing the design and effectiveness of controls that mitigate risks associated with the generation of financial information which, additionally, aim to guarantee the integrity of that information.       

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Legal and regulatory management 




Having regulated businesses implies carrying out our operations in the context of applicable legal regulations. Correct adherence to legal obligations is ensured by our Internal Control and Risk Management System, which guarantees that laws, rules and regulations are complied with.




LEGAL MANAGEMENT

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No fines or sanctions were imposed on Promigas in 2019 for failing to comply with laws or regulations. Similarly, the saving in judicial awards made in favor of Promigas was COP 9,153,385,315; however, the sum of COP 3,498,700,229 was paid under awards which were against the company and a settlement agreement.

Overall, including both Promigas and the affiliated companies for which it renders back office administration services, 34 proceedings were concluded in 2019, 22 of them resulting in favorable awards and the remaining 12 in unfavorable ones.​


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Three of our affiliates were penalized. The Superintendency of Domestic Public Services imposed a sanction on Surtigas for failure to adhere to CREG Resolution 059 of 2012. Since the company does not agree with what is stated in the said administrative act, it will file the appeals established in the law by the legal deadlines stipulated therefor, with a view to getting the sanction revoked.

GdO is currently involved in motions to set aside relating to an administrative decision by the Superintendency of Domestic Public Services to impose a fine under the terms of CREG Resolution 059 of 2012.   

DIAN imposed a sanction on SPEC for the alleged ineffectiveness of two withholding at source declarations for 2016. The value of the sanction was approximately USD 86,000.  ​


Regulatory management 

Natural gas transportation 

Remuneration for assets that have reached the end of the regulatory useful life:

To date, the expert Tipiel S.A. has provided appraisals of those assets which have reached the end of their regulatory useful life. We are waiting for CREG to issue a resolution approving sums relating to the ‘replacement as new’ cost and the cost of keeping the following assets operating:       ​


Promigas, useful life 2016:
La Mami-Bureche loop and two branch gas pipelines.

Promigas, useful life 2017:
12 branch gas pipelines.

Promigas, useful life 2018:
Dibulla-Palomino loop, Palomino compressor, Termoflores gas pipeline, and 15 branch gas pipelines.

Transoccidente, useful life 2016:
Yumbo-Cali gas pipeline.

Promioriente, useful life 2017:
8” Bucaramanga-Payoa gas pipeline
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Transmetano, useful life 2017:
Sebastopol-Medellín gas pipeline.      

Natural Gas Supply Plan
In January 2020, UPME issued the technical study for the Supply Plan to agents, for comments. It is expected that towards the end of the first half of the year, UPME will issue the definitive plan and that this will be taken on board by the Ministry of Mines and Energy. It is envisaged that by the end of the first half of the year CREG will adjust and define regulatory matters associated with the draft Supply Plan and publish the resolution defining the efficient value of investments in the Barranquilla-Ballena bidirectional project, and also that UPME will issue the definitive bid documents for the Pacific Infrastructure early in the second half of the year.  

Transportation rate methodology 
In August 2016, the Commission issued draft CREG Resolution 090 containing a proposed methodology for calculating the natural gas transportation rate. In 2017, 2018 and 2019 efforts were made to get CREG to reinforce a suitable regulatory framework for the transportation activity. According to the regulatory agenda for 2020, it is envisaged that CREG will issue a new resolution for comments in the first quarter of the year, followed by the definitive resolution in the second quarter. 

Natural gas wholesale market. In August, CREG issued Resolution 082 of 2019 for consultation  ​
This proposes adjustments to the marketing of transportation capacity and suggests wider dissemination of available capacity, speedier auction processes, and the possibility of signing shorter contracts, which are perceived as favorable to the activity. It is envisaged that CREG will issue the definitive resolution in the first quarter of the year and that in the third quarter it will issue adjustments to the marketing of supplies for comments.

General behavior framework:
In July, CREG issued definitive Resolution 080 of 2019, which establishes a general market behavior framework for agents engaged in domestic public services activities.   

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Natural gas distribution 

​​​​​​Transformation Mission
The Ministry of Mines and Energy invited the Energy Transformation Mission to draw up a road map that will guide energy modernization in the country. This map will be designed by a group of twenty Colombian and international experts who were chosen for their experience and their knowledge of the focal points defined for the Mission, and results are expected in 2020. The five focal points established are as follows: 

  • The role of gas in energy transformation

  • Decentralization and digitalization of the industry and efficient management of demand

  • Closing gaps, improving quality, and the efficient designing of subsidies

  • Competition, participation in and structure of the electricity market

  • Review of the institutional and regulatory framework  


FNCER auctions 
Two auctions were held in October this year for 

long-term electricity contracts with non-conventional sources. In the first, in February, no projects were awarded because the competition conditions established by CREG were not met. In the second, a target demand of 12,050.5 MWh-day was presented, as determined by the Ministry of Mines and Energy, and CREG established a maximum individual upper price limit of COP 200 kWh. As a result, a total of 10,186 MWh-day were allocated at a weighted average price of COP 95 per kWh. 544 electricity supply contracts were signed with seven generators and 22 marketers under eight projects that were awarded, with a total capacity of 1,298.9 MW, 17.39% of which is solar energy and 82.61% wind energy. 

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Natural gas auction 
The natural gas supply marketing process began in June 2019 with publication of the “Total Production Available for Firm Sale (PTDVF)”, which producers report. Bilateral negotiations commenced later, and these concluded with the signing of long-term contracts. A relevant factor during this process was the Ecopetrol auction for the Cusiana and Cupiagua fields, which culminated in a weighted average price for Cupiagua of USD 5.80 / MBTU for 2021, and for Cusiana a price of USD 4.70 / MBTU for 2020 and USD 5.76 / MBTU for 2021. 

Natural gas distribution
In line with Circular 107 of 2018, companies which render the natural gas distribution service via networks expressed their decision as to whether to remain under the transitory charge or to take on board a new, definitive one in January 2019. The Commission later issued Circular 030 of 2019, which set the rate application process in motion for the new definitive charge. Rate files are expected to be presented in 2020.
CREG issued various resolutions in 2019 that had an impact on the regulatory framework. In Resolution 080 of 2019 the Commission established behavior rules, with a view to progressively migrating to a self-regulation scheme.    

Cálidda:
In Resolution 129-2019-OS/CD, Osinergmin approved the updated Cálidda Five-Year Plan for the period 2018-2022 and the respective rate readjustment. 
The new mean rate was thus established as USD 24.6 per thousand m3, and this came into force in August 2019.  ​


Electricity distribution 
Resolutions were published in 2019 which approved variables for calculating revenue and the electricity distribution charge for network operators. For CEO, Resolution 141 of 2019 contained approval of the variables for calculating company revenue for the next rate period. This Resolution also gave approval for the Investment and Reduction of Losses plans.   



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