The Rio Zulia - Ayacucho Pipeline ('RZA Pipeline') runs from the prolific Catatumbo Basin in east central Colombia to Ayucucho, one of the country's main hubs for both oil and natural gas pipelines; a distance of approximately 180 kms. The 10 inch line has a throughput design capacity of 25,000 bopd but carried approximately 2,800 bopd in 2006 from the EcoPetrol owned and operated Rio Zulia and Tibœ oil fields.

On 4th December 2006, EcoPetrol announced that it had signed an agreement with PetroBras for the redevelopment of the Tibu field. The initial two and half year work programme is aimed at restoring production of 15,000 bopd from the field and confirming reserves of 100 million barrels. For a number of reasons, the RZA Pipeline is likely to be the exit route of choice in respect of the reactivation of this  field. Under the terms of the existing transportation agreement, production rates of 15,000 bopd from Tibu would increase the Company’s net income from the pipeline to US$6 million from its current level of US $1.5 million per year.

In addition to the above agreement, Ecopetrol have also commenced an extended exploration drilling programme near their Rio Zulia Field and in close proximity to the Pipeline. This drilling programme is expected to commence in 2007 and if successful is also expected to increase significantly the flow of oil through and revenue from the Pipeline.

Additionally, the Catatumbo Basin is currently being actively explored by a number of companies. Again, any oil discoveries are likely to use the RZA Pipeline.

Based on an independent report commissioned by the Company, PetroLatina believes that the pipeline will have high strategic value and will generate increased cash flow in the future.