Colombia’s state-controlled oil company Ecopetrol has priced a $2 billion bond sale, its first dollar-bond issue in more than two years, to refinance the borrowing behind its expansion into Brazil.

The company announced on Monday that it had priced $2.0 billion of 7.875% notes due in 2034. The deal was priced on 9 November and is expected to settle on 12 November, subject to customary closing conditions.

Investor demand was strong. The order book peaked at about $6.93 billion, roughly three and a half times the amount on offer, with more than 235 investors taking part from the United States, Europe, Asia and Latin America. It was the company’s largest order book in five years, and the notes priced at a yield of 7.98%, below initial guidance of about 8.35%.

What the money will be used for

Ecopetrol said the proceeds will be used in two ways. First, $810 million will fund the early redemption of its outstanding 8.625% notes due in 2029, which is scheduled for 19 November. Second, the rest will repay in full the short-term acquisition financing used to buy an equity stake in Brava Energia, the Brazilian oil and gas producer, on 17 August 2026.

Ecopetrol took a controlling 51% stake in Brava Energia in a deal valued at about $1.2 billion, giving the Colombian company control of a producer with proved reserves of 459 million barrels of oil equivalent and output averaging about 84,400 barrels of oil equivalent a day in June 2026.

The company stressed that the transaction does not increase its overall debt. Instead, it swaps existing liabilities, pushes maturities further out and cuts refinancing risk, while protecting liquidity and financial flexibility.

A vote of confidence from the market

The bond sale was authorised by Colombia’s Ministry of Finance and Public Credit under Resolution No. 2595, dated 9 November 2026. Citigroup, J.P. Morgan, Itaú BBA and BBVA coordinated the transaction.

It was Ecopetrol’s first dollar-bond sale since October 2024, when it issued $1.75 billion of notes at 7.8%. The company described the deal as part of a proactive approach to managing its debt under its new management team.

Fitch Ratings assigned a ‘BB’ rating to the proposed notes, in line with Colombia’s sovereign rating, reflecting the government’s 88.5% ownership of the company.

For Ecopetrol, the deal closes the financing loop on its biggest Brazilian bet. The Brava acquisition marked a major step in the company’s strategy of growing beyond Colombia, and the strong demand for the new bonds suggests investors are willing to back that expansion — at a price.

Source: Ecopetrol via PR Newswire and Dealroom.