Colombian Oil Fields-1923

Points out differences between the new, more liberal, law passed by the Colombian Congress and the law passed in 1919, gives a few facts about the pipe-line concession granted to a Canadian company, and tells of new drilling developments. PROBABLY the most important development in the Colombian oil situation during the past year was the passage by Congress of a new petroleum law, which went into effect Jan. 31, 1923. The principal points of interest in which this new law changes or improves the previous one are as follows: Law 120 of 1919 provided that one person or corporation could not acquire more than three exploitation zones. of 5000 ha. each, and royalties were based on a sliding scale, to wit: 6 per cent. royalty on lands 400 km., or more, from the ocean; 8 per cent. on lands 200 but not over 400 km. from the ocean, and 10 per cent. royalty on lands located less than 200 km. from the ocean. Rentals were fixed at 10 centavos per hectare for the first year; 20 centavos for the second year; 50 centavos, third year, and $1 (one peso) yearly thereafter. Under this law the term of the lease was fixed at 20 years and, at the discretion of the government, could be extended for 10 years additional. After the expiration of the lease and its corresponding extension, the machinery and other material placed upon the property would vest in the government. A bond of 20,000 pesos was also required of the lessee to guarantee faithful performance of his contract.