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Colombia pipeline flow up as rebel attacks ebb

Colombia's long crippled Cano Limon oil pipeline is pumping at near-optimal levels...

Colombia's long crippled Cano Limon oil pipeline is pumping at near-optimal levels following a surprise drop-off in a bombing campaign by Marxist-inspired rebels, officials said yesterday.

Since August, the pipeline has been producing about 114,000 barrels per day (bpd) - near its historical average of 115,000 bpd, state oil firm Ecopetrol told Reuters.

"This is the best result since January," Ecopetrol spokesman Mauricio Tellez told Reuters.

"Clearly, this is because the number of attacks have fallen," he said, adding that the military had stepped up defense of the pipeline in recent months.

Cano Limon - operated for Ecopetrol by Los Angeles-based Occidental Petroleum - was only bombed 10 times in August, and in September the number of attacks on the 780-kilometre pipeline has fallen to just two so far.

Colombia's second-largest oil pipeline had been virtually paralyzed since early this year by a bombing campaign led mostly by the nation's largest guerrilla group, the Revolutionary Armed Forces of Colombia, or FARC.

The smaller, Cuban-inspired National Liberation Army, known by its Spanish initials ELN, had also been bombing Cano Limon, but called a pipeline truce in May.

Between the two groups, Cano Limon had been bombed about once every day until August.

Oil industry officials, however, told Reuters they were concerned by unconfirmed media reports that the ELN would call off its pipeline truce in October. The guerrilla group did not offer a motive, according to the reports.

"It's not clear if it is true or not. We'll have to wait and see," said one of the officials, who declined to be named.

He speculated that a resumption of ELN bombings could be meant pressure the government, which broke off contact with the 5,000-member rebel group in August. President Andres Pastrana at the time accused the ELN of not being serious about talks to end Colombia's 37-year-old guerrilla war.

The conflict has claimed 40,000 lives in the past decade.

For every day that Cano Limon is out of operation, the government loses $2.3 million in revenues from oil sales alone.

Colombia's cash-strapped government, which only last week gained International Monetary Fund permission to widen its budget deficit targets, counts oil and oil-related income as its biggest source of revenue - raising about $2 billion last year.

Occidental receives 35 per cent of the oil pumped through Cano Limon, Ecopetrol 50 percent, and Spanish-Argentine company Repsol the remaining 15 per cent.

Cano Limon's production increase helped lift Colombia's August output by 70,000 bpd to 668,221 bpd for the month, up 5 per cent against the same month in 2000.

Ecopetrol said the increase in oil output would help Colombia's beleaguered trade balance and economic growth, while also aiding impoverished cities near Cano Limon - like Arauca - which depend on oil royalties for survival.