The minerals and hydrocarbons resources of Colombia play a key role in the economy. The country has been virtually self-sufficient in energy since 1984.
Production of crude petroleum has boomed in recent years due to significant discoveries in the Magdalena Valley. Crude oil is the largest export earner and the major source of foreign exchange earnings.
However, self-sufficiency is only expected to last until around 2005 unless new reserves are discovered. Oil is gradually being replaced by other energy sources, in particular hydropower, gas and coal.

The Latin American nation has proven high-quality coal reserves of more than seven billion tonnes, the largest reserves in Latin America. Development is centred on Cerrejon Zona Norte (CZN) in Guajira, the world’s largest open-pit coal mine. Total annual coal production is more than 36 million tonnes and coal is the third most important export after oil and coffee.
Coal output is expected to rise over the next decade. Exports of coal are estimated to have risen in 2001 to 40 million tonnes, up from 36 million tonnes in the previous year. This would make coal Colombia’s second most important export product, overtaking coffee. Vice-minister of mines Luis Ernesto Mejia predicts that by 2008, Colombia’s coal exports will exceed 70 million tonnes.
Australia’s BHP Billiton, Anglo American and Glencore International are jointly taking control of El Cerrejon. Exxon Mobil is selling its 50 percent stake in the mine and associated railway lines and port operations for a reported $500-$600 million.

BHP and its two partners moved into the El Cerrejon mine two years ago after buying out the Colombian government’s stake for $473.7 million. The mine supplies both the U.S. and Europe, but two satellite deposits are expected to allow greatly increased exports to the European Union as South Africa strains to meet demand.
Coal for thermal power generation plants is in increasing demand around the world, and European buying will increase as production in Britain and Germany declines. For the three corporate buyers, acquisition of CZN will allow integration with another of their operations just 11 miles away, the Carbones de Cerrejon mine.

The CZN mine produces about 19 million tonnes of thermal coal a year, but there are two neighboring deposits that could allow BHP Billiton, Glencore and Anglo American to boost output to as much as 40 million tonnes a year.
High demand around the world for thermal coal is keeping prices robust at a time when most mineral commodities are under severe strain.