Ecopetrol Takes Control of Brava Energia in $1.2B Brazil Growth Bet

Ecopetrol completed its $1.2 billion acquisition of a 51% controlling stake in Brazil’s Brava Energia, creating an operating platform in a strategic growth market and adding production, reserves and cash-flow potential. Brava’s first-half 2026 output averaged about 79,000 barrels of oil equivalent per day, with its production equal to roughly 11% of Ecopetrol’s output and its proved reserves representing nearly 24% of Ecopetrol’s reserve base. The deal could have increased Ecopetrol’s revenue by 7% and EBITDA by 8% on a pro forma basis. Ecopetrol funded the transaction with a one-year $1.2 billion bridge facility and expects leverage to remain below its 2.5-times debt-to-EBITDA threshold. Integration will focus on governance, operational efficiency and developing assets such as the Papa-Terra and Atlanta offshore fields.

Ecopetrol NYSE: EC said it has completed the acquisition of a 51% controlling stake in Brazilian independent oil and gas company Brava Energia for approximately $1.2 billion, establishing an operating platform in Brazil that the company said will add production, reserves and cash-flow potential to its portfolio. The transaction closed Aug. 17 following a two-step process conducted through Ecopetrol Investimentos do Brasil. Ecopetrol first signed an agreement in April 2026 to acquire a 26% interest from key shareholders, then launched a public tender offer for an additional 25% stake. The company has appointed three representatives to Brava's board of directors.

Julián Lemos, Ecopetrol's corporate vice president of strategy and new businesses, described Brazil as a strategic growth market due to its hydrocarbon resources, offshore basins, regulatory framework and energy infrastructure. He said Brava is Brazil's second-largest independent oil and gas player by production and reserves.

Brava produced approximately 79,000 barrels of oil equivalent per day during the first half of 2026, with oil accounting for 79% of output and gas representing the remaining 21%. Ecopetrol said the acquired business adds production equal to about 11% of Ecopetrol's output, while Brava's proved, or 1P, reserves represent nearly 24% of Ecopetrol's reserve base reported at the end of 2025.

The company said the acquisition price equated to approximately $8.40 per barrel of 1P reserves and $6.30 per barrel of 2P reserves. Chief Financial Officer Camilo Barco said that, based on first-half 2026 results, Brava would have increased Ecopetrol's consolidated revenue by about 7% and EBITDA by about 8%. Net income attributable to Ecopetrol shareholders would have risen approximately 2%, excluding debt-related transaction costs, he said.

Brava's operations will be consolidated beginning in September, resulting in only a partial impact on Ecopetrol's third-quarter 2026 results. Investors should see a full quarter of Brava's contribution beginning in the fourth quarter, Barco said. Barco also cited Brava's adjusted EBITDA margin of more than 49% and said its return on average capital employed, or ROACE, is expected to be broadly in line with Ecopetrol's level of roughly 9.1% to 9.2%.

Ecopetrol initially financed the acquisition with a bridge facility of about $1.2 billion, including the transaction value as well as estimated financing costs, fees and interest for 2026. The one-year facility was arranged through international financing subsidiary Ecop...