Washington, D.C., May 17, 2006
— The International Finance Corporation, the private sector arm of the World Bank Group, has signed an agreement to purchase equity worth up to $15 million in Grupo Petrotesting, a Colombian oil and gas company.
Petrotesting shares with IFC a commitment to sustainable development, and the collaboration aims both to channel oil and gas royalties more effectively toward efforts to reduce poverty and to implement best practice environmental and social programs. Petrotesting, an entrepreneurial company at an early growth stage, will use IFC’s equity investment to strengthen its expansion strategy in Latin America.
“This transaction reaffirms IFC’s commitment to supporting the growth of Colombian companies that are operating in the local oil and gas sector. Petrotesting’s commitment to long-term sustainable development in Colombia and the Andean region and its strong growth potential are important factors in making this investment,” said Rashad Kaldany, IFC’s Director for Oil, Gas, Mining, and Chemicals.
Frank Kanayet, Chairman of Petrotesting, said, “We are very pleased with the IFC investment. This will allow us to accelerate the development of our assets and to expand our operations, both in Colombia and internationally.”
Atul Mehta, IFC’s Director for Latin America, noted, “The financing to Petrotesting fits well with IFC’s strategy of supporting local oil and gas companies in Colombia that are looking for sustainable growth and sound expansion in the region.”
Manuel Gonzalez, Executive Vice President of Petrotesting, said, “Having IFC as our partner will help us access global markets and continue with our social and environmental work. This is important as we continue to build a better country, where peace can be a reality.”
IFC in Colombia
IFC’s total portfolio in Colombia was $280 million as of June 2005. Since Colombia joined IFC in 1956, the Corporation has provided $1.4 billion, including syndications, for 58 companies.
IFC’s strategy in Colombia involves increasing support to strategic sectors for economic growth in the context of free trade agreements. This strategy includes financing infrastructure projects, such as port expansion and road and airport concessions, as well as support to companies in the logistic services sector. In addition, IFC seeks to finance oil and gas companies that are expanding in the region. The financial sector also continues to be one of IFC’s priorities in Colombia, with special emphasis on housing finance and microfinance, as well as strengthening local capital markets and improving corporate governance.
About IFC
The International Finance Corporation is the private sector arm of the World Bank Group and is headquartered in Washington, D.C. IFC coordinates its activities with the other institutions of the World Bank Group but is legally and financially independent. Its 178 member countries provide its share capital and collectively determine its policies.
The mission of IFC is to promote sustainable private sector investment in developing and transition countries, helping to reduce poverty and improve people’s lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY05, IFC has committed more than $49 billion of its own funds and arranged $24 billion in syndications for 3,319 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY05 was $19.3 billion for its own account and $5.3 billion held for participants in loan syndications. For more information, visit
www.ifc.org.
