Shale oil in Colombia

Colombia is auctioning the right to exploit non-conventional hydrocarbon reserves, including shale oil and methane.

More oil may not be an ideal option for the environment, but it could be good for peace.

Latin America's fourth biggest oil producer, Colombia aims to raise around $2.6 billion, according to the National Hydrocarbons Agency, which is overseeing the auction.

Earlier this month, Canada-based Canacol Energy together with and ConocoPhillips of the United States paid $13 million for the right to explore for shale oil in the Middle Magdalena Basin.

In addition, Canacol has agreements with United States-based ExxonMobil Corporation and Royal Dutch Shell.

The first auctions of shale acreage in Colombia were held late last year, with ExxonMobil and state-owned Ecopetrol making the highest bids for three onshore blocks.

Colombia's conventional reserves were 2.4 billion barrels as of 2012, equivalent to only six years' output at current levels.

More oil may not be an ideal option for the environment, but it could be good for peace.

Some of the profits from the business could go to Colombia’s rebel movement (FARC in its Spanish initials), especially since much of potential new production is in FARC-controlled areas.

Oil revenue would let the FARC wind down its involvement in cocaine exports, currently an important source of income for the movement.

The government in turn would be willing to accept the FARC as a legitimate political party, putting an end to a half-century of civil war.

The two sides have been in negotiations in Havana since last year.