Canacol's subsidiary reached a deal to for the exploration and production of the Santa Isabel area in Colombia. Conoco will cover the costs associated with drilling up to 13 wells in the play. The Canadian company said it holds five contracts in Santa Isabel covering 334,000 net acres in the unconventional shale oil play.
Canacol President Charle Gamba said recent drilling results in the area confirmed the Colombian acreage was large in terms of resource potential.
Canacol stays on as the operator in Santa Isabel. Its first exploration will is planned for the second quarter of 2013.
The U.S. Energy Department's Energy Information Administration said Colombia, as of 2011, was producing 923,000 barrels of oil per day, up 35 percent from 2008 levels.
"This rising production trend is continuing," the EIA assessment read.