The Carlyle Group is divesting its stake in SierraCol Energy, Colombia's largest independent oil and gas exploration and production company, to Philippines-based Prime Infrastructure Capital. The transaction, expected to close before the end of March pending regulatory approvals, was reported by Reuters last year to carry a price tag of approximately $1.5 billion, though the final value was not disclosed.

Company Profile and Transaction History

SierraCol produces roughly 10% of Colombia's oil. Carlyle acquired the company in 2020 for $825 million through its Carlyle International Energy Partners (CIEP) fund as part of Occidental Petroleum's Colombian asset portfolio. Since the acquisition, SierraCol has invested nearly $1 billion in capital expenditure, adding over 100 million barrels of oil equivalent in reserves and achieving a reserves replacement ratio of about 135%.

Reserves and Strategic Acquisitions

The company's current proven plus probable reserves are 129 million barrels, providing a reserves life of 10 years. Its holdings in the Cano Limon field have a cumulative historical production exceeding 1.5 billion barrels. During Carlyle's ownership, SierraCol expanded by acquiring the Colombian assets of Spain's Moeve (formerly Cepsa) and repurchasing Repsol's minority stakes in the SierraCol Arauca assets.

Broader Context and Future Outlook

Carlyle described SierraCol as a fully standalone, responsible operator and a leading employer that is a trusted partner to Colombia's state-controlled Ecopetrol. Ecopetrol recently announced plans for up to $7.2 billion in capital expenditure this year, including drilling 380 to 430 development wells. In parallel with this divestment, Carlyle has pursued other energy sector investments, including acquiring Altera Infrastructure Group's FPSO business and reportedly having a preliminary agreement to acquire Lukoil's foreign assets. BofA Securities acted as lead financial advisor and Latham & Watkins LLP as legal counsel to Carlyle for the SierraCol sale.