Pemex engineers repairing a pipeline in Mexico

Colombia's finance minister said Mexico should look to the South American country as an example to follow in the fight against fuel theft, but the statement raises questions about how successful Colombia's approach to the issue has really been.

In an interview with Mexican daily El Universal, Colombia's Finance Minister Mauricio Cárdenas said Mexico's state-owned oil company Pemex could learn how to combat fuel theft from its Colombian counterpart, Ecopetrol.

"If you want to, you can do it," Cárdenas told El Universal. "There's a very productive and constant dialogue between Pemex and Ecopetrol, with lots of opportunities for joint operations between them."

Cárdenas said Colombia had substantially reduced fuel theft, depriving criminal organizations of an important revenue stream. He claimed technological advancements helped authorities to detect theft more quickly, and also to build stronger and safer pipelines.

InSight Crime Analysis

Oil theft continues to plague Mexico. Aided by corruption, the practice has grown exponentially in recent years; in 2016 alone, Pemex lost at least $1.5 billion in stolen fuel.

Contrary to Cárdenas' claims, however, Colombia is hardly an example Mexico should follow in the quest to eradicate oil theft. In fact, Colombian organized crime groups still benefit significantly from the criminal activity, albeit in different and arguably more sophisticated ways than their Mexican counterparts.

While Mexican crime groups, most notably the Zetas and the Sinaloa Cartel, profit from fuel theft by selling stolen oil on the black market, Colombian armed groups such as the National Liberation Army (Ejército de Liberacion Nacional – ELN) profit from the oil industry by and large by extorting companies and threatening to blow up the pipelines if they fail to comply.

SEE ALSO: Coverage of Oil Theft

Colombian crime groups also rely on stolen fuel for processing cocaine. Illegal armed groups in Colombia have long used artisanal refineries to refine stolen crude oil and eventually use it to produce coca base. In addition, stolen fuel is used to power machinery used in illegal mining operations.

During a recent field investigation, InSight Crime learned that while the number of illegal oil siphoning valves found on Ecopetrol's Trans-Andean Pipeline (Oleoducto Transandino) in southwest Colombia appears to have fallen over the past few years, the pipeline still lost nearly 20 million liters of oil to siphoning in 2016 alone. (See graph below)

Thus, despite Cárdenas' assertions, it appears that Colombia still has a long way to go in terms of putting an end to this illicit activity.

Investigations

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