Frontera cinches LNG contract with Ecopetrol to underwrite FSRU lease

June 1, 2026, by Melisa Cavcic

Canada’s Frontera Energy Corporation has pivoted to a fully focused, pure-play energy infrastructure company by exiting the exploration and production segment and betting on liquefied natural gas (LNG), liquefied petroleum gas (LPG), and container growth at Puerto Bahía, Colombia.

Sociedad Portuaria Puerto Bahía (Puerto Bahía)

Frontera Energy has revealed that the completion of the divestiture of its Colombian exploration and production assets to Parex Resources through its wholly-owned subsidiary enables it to formally become a fully focused, pure-play energy infrastructure company.

The firm claims to be uniquely positioned as a focused infrastructure platform within Colombia’s energy value chain anchored by the cash‑flow generation from its ownership in Oleoducto de Los Llanos Orientales (ODL) and a portfolio of strategic projects, bringing additional growth to its subsidiary, Sociedad Portuaria Puerto Bahía (Puerto Bahía), which together provide a differentiated value proposition in the infrastructure space.

Gabriel de Alba, Chairman of the Board of Directors at Frontera, commented: “Frontera has evolved into a focused energy infrastructure company at a critically important time for Colombia and the broader energy sector. The ODL pipeline, one of Colombia’s most important energy infrastructure assets, provides stable and predictable cash generation, while Puerto Bahía represents a strategically located, difficult-to-replicate infrastructure platform with significant expansion potential.

“Together with a strong balance sheet, these assets position the Company to deliver a compelling combination of resilient cash flows, visible growth opportunities, and long-term value creation. With approximately $64 million of cash on its balance sheet, expected ODL dividends of approximately $65 million this year, and multiple near-term catalysts supporting the expansion of Puerto Bahía, including the LNG regasification project, which has now entered the execution phase, Frontera is well positioned to capitalize on Colombia’s growing energy infrastructure needs.”

Puerto Bahía has entered into a take-or-pay agreement with Ecopetrol, which will enable it to provide integrated logistics and LNG regasification services in Cartagena, Colombia. The agreement is to be developed in two phases, with initial regasification of 126 million cubic feet per day (cfd), starting in 2027, increasing to 300 million cfd after the first two years.

The company has entered into a contract with a U.S.-based player for the lease of a floating storage and regasification unit (FSRU) and the provision of related operations and maintenance (O&M) services to fulfill the contract and satisfy additional demand needs. The agreement provides Puerto Bahía with access to an FSRU with LNG regasification capacity of around 500 million cfd beginning in 2027 for an initial term of seven years, extendable for an additional five to eight years.

Orlando Cabrales Segovia, Chief Executive Officer at Frontera, remarked: “The Puerto Bahia agreements mark an important milestone in the advancement of the LNG project and further reinforces the strategic role of Puerto Bahia within Colombia’s energy infrastructure. Through our partnership with Ecopetrol and one of the world’s largest FSRU providers and operators, we are combining Puerto Bahía’s established infrastructure and operating capabilities with a proven global LNG platform to provide a reliable and scalable solution to Colombia’s growing natural gas supply needs.

“We also continue to make meaningful progress across our energy infrastructure projects, including reaching a key milestone in the LPG project with the successful commencement of initial operations, which gives us the capacity to handle up to 10,000 tons per month. We are also evaluating the entry into power generation anchored by our LNG project, in particular, the potential development of a gas fired power plant at Puerto Bahia. At our container business, we also expect further growth beyond the current capacity of approximately 42,000 TEUs per annum.”

The firm emphasizes that the take-or-pay agreement with Ecopetrol represents a committed offtake volume intended to underwrite the FSRU lease contract. The project is perceived to have meaningful upside through potential incremental third-party demand, supported by South America’s growing natural gas supply deficit, weather-related supply pressures associated with El Niño conditions, and the additional regasification capacity expected to be provided by the contracted FSRU.

Frontera owns a 35% equity investment in the ODL pipeline, which connects Rubiales, Quifa, Caño Sur, Llanos-34, and other blocks to the Monterrey and Cusiana Stations in the department of Casanare, Colombia, transporting approximately 30% of the country’s oil production and serving the Llanos basin, which holds roughly 70% of Colombia’s proven crude oil reserves.

The Canadian player owns a 99.97% equity interest in Puerto Bahía, a strategically located multi-purpose maritime and logistics terminal in Cartagena, Colombia, adjacent to the Bocachica access channel in Cartagena Bay. Under the LNG project with Ecopetrol, Puerto Bahía would provide services, including receiving LNG, regasifying it and delivering regasified natural gas at agreed delivery points.

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The LNG project is perceived to be supported by Colombia’s growing natural gas supply deficit, the weather-related supply pressures associated with El Niño conditions and the resulting need for reliable alternative sources of supply. The project is expected to strengthen Puerto Bahía’s role in the country’s energy infrastructure while supporting energy security and long-term growth in the asset’s service offering.

The LNG project is expected to benefit from the terminal’s existing port infrastructure and operating platform, including the Reficar connection for natural gas, which is expected to support an accelerated development timeline and faster time to market. Puerto Bahía is positioned to leverage several existing advantages in advancing the project, including regulatory readiness, as the existing environmental license and concession allow for LNG imports.

The LNG project is expected to start commercial operations at the beginning of 2027. Puerto Bahía and Gasco Soluciones Logísticas y Energéticas S.A.S. (Gasco) have entered into a collaboration agreement to develop, construct and operate a refrigerated LPG storage facility at Puerto Bahía, with capacity to import and store more than 240,000 tonnes of LPG annually, supported by a ten-year offtake agreement with Gasco.

The terminal has made meaningful progress toward its development, including the commencement of operations in March 2026, which provides handling capacity of up to 10,000 tonnes per month. Puerto Bahía continues to advance the project to achieve full operations during the first quarter of 2028.

The terminal has delivered strong growth in container volumes, increasing from nil in 2024 to approximately 18,000 TEUs in 2025, with further growth expected. Existing infrastructure already has the capacity to support approximately 42,000 TEUs per annum.

“Puerto Bahía is focused on regional containerized cargo lines to capture trade growth and further develop its role as a regional transshipment hub. The asset has meaningful upside potential to strengthen its position as a containerized cargo hub in Cartagena, supported by a phased expansion strategy aligned with volume growth,” highlighted Frontera.