EPC projects across the energy value chain

Colombia

Daniel Lucio, CEO and president of Summum, talks to The Energy Year about the company’s involvement in EPC projects, its current focus on the oil and gas sector, and its diversification strategy. Summum is an engineering, procurement and construction company working across the energy value chain.

How has the company’s involvement in EPC projects evolved, and what is your current focus in the oil and gas sector?
We’ve gone through several stages in our EPC work. From 2010-2012, we focused primarily on pure engineering. Then we returned to EPC markets from around 2015-2018. Now we’re re-establishing our EPC business line with the intention of maintaining it indefinitely by being present in the upstream, midstream and downstream.
Currently we’re working on two significant EPC contracts, each valued at approximately USD 25 million. These projects are for private sector clients in the oil and industrial sectors. Our target is EPC projects ranging from USD 5 million to USD 50 million-60 million, which we sometimes undertake alone and other times with partners in consortiums, allowing us to be more agile and responsive.
We’ve recently signed a framework contract with Frontera Energy, which is expected to start by the end of the year and last for two to three years. It’s an umbrella agreement under which various EPC works will be executed through service orders.
As of 2024, about 75-80% of our revenue and headcount is in engineering, with the remainder in construction. However, we’re aiming to strengthen our EPC business line by actively bidding on new projects. By next year, we expect our EPC backlog to double from the current USD 25 million to USD 50 million-60 million.

What diversification strategy have you pursued in the oil and gas sector?
We’ve built a strong reputation in O&M [operations and maintenance] and in EOR. Regarding the former, we’re actively managing oil and gas assets for various clients, including one project in Colombia that could exceed USD 25 million-30 million.
However, where we really shine is in our EOR operations. We’ve been working with polymer injection for about a decade now, making us one of the most experienced companies in Colombia in this area. Our expertise covers various EOR methods, including water flooding, steam injection and polymer flooding.
Our approach to polymer injection is comprehensive. We’ve formed a strategic alliance with a polymer manufacturer, which allows us to offer a complete package to our clients. In these contracts, our partner supplies the polymer, and we handle the operation of injecting it into the wells. This end-to-end service has been very attractive to clients looking to maximise recovery from mature fields.
We also have some experience in renewables, having executed photovoltaic projects in Colombia. However, despite the enthusiasm and intent, there is a lack of momentum. There’s a difference between expectations and discussions at conferences and actual project development. Once these plans evolve into concrete projects, we become highly active.
In engineering, we are particularly strong, and this outlook extends beyond 2024 into 2025, with large contracts. Recently, we won a significant midstream contract with Cenit, which has just been signed and will run through 2025 and beyond.

How has the integration of new technologies transformed the logistics and transportation sector in Colombia, and what are the key outcomes you have observed?
By collaborating with technology firms, we have been able to integrate cutting-edge solutions into our operations, such as the development of a custom-built logistics platform in partnership with a leading software company. This platform has enabled us to manage our supply chain more efficiently, resulting in a 10% reduction in operational costs.
The use of advanced software for route optimisation and fleet management through strategic partnerships has also enabled us to cut down travel time by 15%, which in turn reduces fuel consumption and lowers our carbon footprint.
Moreover, the incorporation of real-time tracking systems has enhanced our ability to monitor cargo movements, ensuring better security and reducing the risk of theft. The adoption of these technologies has also enabled us to provide more accurate delivery times to our clients.

How would you describe your experience and involvement in the petrochemicals sector, and are there plans to further expand in this area?
We have had a significant presence in the petrochemicals sector in the past, with the company’s involvement in this area contributing around 13-16% of our total revenue over the last 10 years. In fact, about five to six years ago, the petrochemicals business was quite active and substantial for Summum.
However, in more recent years, the company’s focus on petrochemicals has somewhat diminished, though it still remains an area of interest and involvement. While we may not be as heavily involved in petrochemicals as we once were, the company still maintains expertise and relationships in this sector.
As we look to the future, we are open to exploring opportunities to further expand our presence in the petrochemicals industry, particularly if favourable market conditions and project opportunities arise.

How are you expanding operations beyond Colombia, and what opportunities are you pursuing in other countries?
We’re actively expanding our operations beyond Colombia, with a particular focus on Peru, Mexico and potential opportunities in Ecuador and the Caribbean. In Mexico we have two large contracts with Pemex, and we’re expecting revenues of about USD 18 million in 2024. In Peru we’re projecting revenues of USD 7 million-8 million for the same year. With these contracts, we are planning on expanding and growing 30% in terms of revenue for this year.
We’re closely monitoring developments in Ecuador, where there’s growing enthusiasm for infrastructure projects in the oil and gas sector. We’re also exploring opportunities in Central America and the Caribbean, particularly in Guyana, which is experiencing significant growth in its oil sector. While we’re primarily focused on South and Central America, we’re open to opportunities further afield, having previously worked on projects as far away as Bangladesh.

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