Oil giant Ecopetrol, Colombia’s largest company and contributor of 12% to 15% of the country’s tax revenue, has been immersed in its latest scandal since newspaper El Tiempo uncovered contracting irregularities with the American multinational law firm Covington & Burling in late May.
The firm, self-tasked with helping “clients navigate their most complex business problems, deals, and disputes,” was hired by mostly State-owned Ecopetrol in August 2024 to advise its board of directors on confidential sensitive matters, in a business transaction known as “Operation Little House” (Operación Casita).
And although the contract was initially set at $875,000 USD, a supplementary clause was discovered by investigators, approved by Alberto Vergara, director of compliance at Ecopetrol. In this, an additional $5 million USD were to be paid to Covington & Burling for their independent review of the processes carried out in relation to the appointment of Ecopetrol’s current CEO, Ricardo Roa.
The contractual activities which the American firm was tasked with included the surveillance of 70 employees’ data in order to preserve the company’s information security, and assessing the potential interest of the U.S. Securities and Exchange Commission in allegations against Roa. Previously, Roa had worked as current-President Petro’s campaign manager in 2022.
Image Source: Ricardo Roa via X.
Since he was first named as Ecopetrol’s CEO in 2023, Roa has been denounced for corruption by several employees, some of whom are included in the list of 70 individuals whose information was to be inspected and retained by Covington & Burling.
Additionally, the Colombian Prosecutor’s Office has also recommended sanctions against the CEO and other former members of the president’s campaign team, alleging serious omissions and concealments that exceeded the financial limits set for managing electoral campaigns.
Ecopetrol has also experienced recent market and sector-wide depreciation, the last of which was set at 23.71% in April 2025, greatly underperforming the oils-energy sector’s loss of 11.18%. This is, at a time when the company is shifting its vision and mission as part of its commitment to net-zero carbon emissions by 2050.
“Indeed, the macroeconomic conditions are not the best for Ecopetrol. The main challenge in that front is oil demand. The fears of recession in the U.S. and the disruption in global trade after liberation day are behind the lack of dynamism in demand,” Dr. Javier Mejia Cubillos, Colombian economist and lecturer at Stanford University, told Latin America Reports.
“However, most of the challenges that the company faces [currently] are internal, and they largely come from the political interference in its governance,” Dr. Mejia Cubillos added.
The country’s current administration has led drastic changes to the oil and energy sectors via the Route of Just Energy Transition (Ruta de la Transición Energética Justa- TEJ). Through it, President Petro suspended the signing of new coal, gas, and oil exploration contracts in 2023.
Furthermore, the president has also faced backlash for allegedly using Ecopetrol as his administration’s cashbox. From tax increases ordered by the National Tax and Customs Directorate resulting in a $9.4 billion peso charge to the payment of State debt to Ecopetrol through bonds rather than cashflow, critics argue that the president’s meddling has undermined the company’s financial autonomy.
“In Petro’s theories, Ecopetrol is a company that is destined to be bankrupt, for which he has no interest in thinking about its long-term survival. Instead, he sees it as a source of immediate funding for the government,” Dr. Mejia Cubillos noted.
Regardless, although President Petro first claimed that the $5 million USD supplementary clause in Ecopetrol’s latest scandal was “false,” he has since defended Roa.
“I don’t know if the firm Covington acted irregularly, it was suspended before the complaints were issued by Ecopetrol’s board of directors. But according to the testimonies of this corporate management, Roa had nothing to do with its selection nor actions,” the Colombian president asserted.
“What Ecopetrol must do today, looking towards the future, is use its potential- and I say this very clearly: sell its fracking operations in the U.S. in order to invest in clean energy generation, in artificial intelligence, in national, Latin American, and submarine fiber optics, and in American electric transmission to face a world where oil is on decline,” the head of state further shared through social media.
Meanwhile, members of the company’s board of directors have affirmed that they were not informed of the additional $5 million USD charge in the company’s contract with Covington & Burling, in spite of having approved the initial contract in August 2024.
“Neither the Audit Committee nor the Board of Directors was consulted regarding the signing of the addendum to the original contract- much less about the changes to its scope and value. As a result, the Board of Directors ordered the suspension of activities as of February 2025,” Ecopetrol’s board stated in a May 29 press release.
Since the scandal, however, board member and former Minister of Justice Mónica de Greiff resigned “irrevocably”. Conversely, Vergara was sacked from his position as director of compliance on June 4.
Image Source: Superintendencia de Industria y Comercio via X.
In a video shared with Ecopetrol employees on May 30- and then swiftly deleted- Vergara stated that Ecopetrol had the legal right to client-lawyer confidentiality, for which the company would respect due processes.
“It must be absolutely clear: in Ecopetrol, the board of directors, administration, compliance management, and human and professional team have never authorized the interception of data nor any other measure that violates people’s private communications,” Vergara stated, days prior to his sacking.
All parties, however, have emphasized Roa’s innocence in the ordeal. In fact, the CEO was amongst the 70 individuals whose information was to be analyzed by the American firm, and he explained that as CEO, he cannot sign nor directly participate in any contract process.
“In light of the evident lack of confidential data and documents, on May 24 we activated a digital analysis process within our cybersecurity framework. Preliminary findings suggest that these are internal leaks which violate the code of ethics, corporate governance, and the law. So far, 29 cases have been identified that may have breached information security protocols,” the CEO explained.
Featured image credit:
Image: Logo y topografía oficial de Ecopetrol S.A.
Author: ECOPETROL S.A.
Source: https://saaeuecpprdpecp.blob.core.windows.net/web/esp/manual-de-identidad/index.html
License: https://commons.wikimedia.org/wiki/File:Logo_Ecopetrol.png
