Eric Watkins
Senior Correspondent

LOS ANGELES, June 24 -- Colombia's 780-km Caño Limon-Coveñas oil pipeline was shut down after guerrillas of the Fuerzas Armadas Revolucionarias de Colombia (FARC) dynamited it in two places in the northeastern provinces of Arauca and Norte de Santander.

The oil pipeline, which has a capacity of 240,000 b/d, normally transports about 100,000 b/d to the Caribbean seaport of Covenas from the Caño Limon fields operated by Occidental Petroleum in the eastern Colombian province of Arauca.

State oil company Ecopetrol, which operates the line with Occidental, said the FARC attacks occurred in the municipalities of Tibu in Norte de Santander and Arauquita in Arauca. It said the first attack took place on June 21 when three men dynamited the pipeline at El Progreso, while the second attack occurred on June 22.

The attacks caused oil spillages and forced Ecopetrol to suspend crude shipments through the pipeline. At the same time, military officials said they had to ensure that engineering teams were not harassed and that there weren't any antipersonnel mines near the line.

The attack is the second in as many months, as the Caño Limon-Coveñas line was shut down for 8 days this spring when it was bombed by rebels on April 29. That blast occurred just after US ambassador to Colombia, William Brownfield, said that military aid used to help protect the line from sabotage should be redirected to social programs.

"Given that the security of the Caño Limon pipeline is incredibly better than it was 5 years ago, it makes sense for these funds to be transferred to other areas," Brownfield told reporters during a visit to the line. He was responding to news that attacks on the line had been diminishing in recent years.

Altogether, FARC guerrillas and the much smaller National Liberation Army, or ELN have dynamited the Caño Limon pipeline about 1,000 times over the past 20 years. According to local media, higher security and the military presence in the zone have decreased the number of attacks against the pipeline in recent years from the record 170 attacks in 2001.

The attacks this month and in late April coincided with announcements concerning stepped up exploration and production from Colombia's oil fields.

On June 20, Compania Espanola de Petroleos SA (Cepsa) of Spain finalized the acquisition of a 70% participation in the Caracara Block in Colombia's Los Llanos basin through its local subsidiary Cepsa Colombia SA.

Cepsa acquired the rights for exploration and production in the block, which now produces over 20,000 b/d of crude oil. Its reserves are estimated at 40 million bbl. Cepsa operates the block together with Ecopetrol, which holds the other 30%.

In May Occidental Petroleum reported that it expected gross output at two oil operations in Colombia to reach 135,000 b/d by 2011, up 24,000 b/d or about 22% from its current production of 111,000 b/d.

Oxy's Colombia Pres. David Stangor said production at the La Cira Infantas field should rise about 50,000 b/d in the next 3 years from the current 15,000 b/d. It said keeping crude production at 95,000 b/d in the Llanos Norte area, including the Caño Limon field, would depend on the success of new exploration projects.

"Here in Llanos Norte, it is going to be very dependent on exploration…how far we fall off is going to be dependent on exploration success. If we are wildly successful, we can keep it at 95,000 b/d or so," Stangor said.

Meanwhile, Spanish Foreign Minister Miguel Angel Moratinos has offered Colombia's help in ending what has become Latin America's longest-running guerilla insurgency. On a visit to Bogotá June 18, Moratinos said Spain is willing to collaborate in efforts to bring FARC guerrillas to the negotiating table and he called on FARC to release hostages it holds.

The offer follows recent failed efforts to mediate hostage releases by French President Nicolas Sarkozy and by Venezuelan leader Hugo Chavez, who has been accused by Colombia and the US of financially supporting the FARC rebels.

Colombia produced about 540,000 b/d of oil last year, and much of its output was exported, primarily to the US. But it would like to increase those figures, according to Armando Zamora, chief of Colombia's oil licensing agency ANH, who said Ecopetrol aims to raise output first to 700,000 b/d by 2015 and to 1 million b/d by 2020 (OGJ, Apr. 7, 2008, Newsletter).