As filed with the Securities and Exchange
Commission on April 25, 2014






UNITED
STATESSECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549










FORM
20-F

ANNUAL REPORT PURSUANT TO

SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934










For the
fiscal year ended December 31, 2013



Commission file number: 001-34175



ECOPETROL S.A.

(Exact name of Registrant as specified
in its charter)










N/A

(Translation of Registrant’s
name into English)














REPUBLIC OF COLOMBIA

(Jurisdiction of incorporation or
organization)












Carrera 13 No. 36 –
24

BOGOTA – COLOMBIA

(Address of principal executive offices)










Alejandro Giraldo

Investor Relations Officer

investors@ecopetrol.com.co

Tel. (571) 234 5190

Carrera 13 N.36-24 Piso 7

Bogota, Colombia

(Name, Telephone, E-Mail and/or Facsimile
number and Address of Company Contact Person)



Securities registered or to be registered
pursuant to Section 12(b) of the Act.










|Title of each class                                                                                                                      |  | Name of each exchange on which registered:         
|---------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------
|American Depository Shares (as evidenced by American Depository Receipts), each representing 20 common shares par value Ps$250 per share |  | New York Stock Exchange                            
|Ecopetrol common shares par value Ps$250 per share                                                                                       |  | New York Stock Exchange (for listing purposes only)
|7.625% Notes due 2019                                                                                                                    |  | New York Stock Exchange                            
|4.250% Notes due 2018                                                                                                                    |  | New York Stock Exchange                            
|5.875% Notes due 2023                                                                                                                    |  | New York Stock Exchange                            
|7.375% Notes due 2043                                                                                                                    |  | New York Stock Exchange                            

Securities registered
or to be registered pursuant to Section 12(g) of the Act: None



Securities for which
there is a reporting obligation pursuant to Section 15(d) of the Act: None





Indicate the number of outstanding shares
of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.



41,116,698,456 Ecopetrol common shares,
par value Ps$250 per share



Indicate by check mark if the registrant
is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.



xYes
 ̈No



If this report is an annual or transition
report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934.



 ̈Yes
xNo



Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.



xYes
 ̈No



Indicate by check mark whether the registrant
has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted
and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter
period that the registrant was required to submit and post such files).



N/A



Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and
large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):



|Large accelerated filer x |  | Accelerated filer   ̈ |  | Non-accelerated filer   ̈
|------------------------- |  | -------------------- |  | ------------------------



Indicate by check mark
which basis of accounting the registrant has used to prepare the financial statements included in this filing:



| ̈ U.S. GAAP |  |  ̈  International
Financial Reporting Standards as issued by the
        International Accounting Standards Board |  | x Other
|----------- |  | ---------------------------------------------------------------------------------------------------------------- |  | -------



If “Other” has been checked
in response to the previous question, indicate by check mark which financial statement item the registrant has elected to
follow:

 ̈
Item 17   x Item 18



If this is an annual report, indicate by
check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 ̈Yes
xNo











TABLE OF
CONTENTS



|           |                                                            | Page
|---------- | ---------------------------------------------------------- | ----
|           |                                                            |     
|           | Forward-Looking Statements                                 | 1   
|           | Enforcement of Civil Liabilities                           | 2   
|           | Presentation of Financial Information                      | 2   
|           | Presentation of Abbreviations                              | 4   
|           | Presentation of The Nation and Government of Colombia      | 4   
|           | Presentation of Information Concerning Reserves            | 5   
|ITEM 1.    | Identity of Directors, Senior Management and Advisors      | 5   
|ITEM 2.    | Offer Statistics and Expected Timetable                    | 5   
|ITEM 3.    | Key Information                                            | 5   
|           | Selected Financial Data                                    | 5   
|           | Exchange Rate Information                                  | 7   
|           | Risk Factors                                               | 7   
|ITEM 4.    | Information on the Company                                 | 24  
|           | The Company                                                | 24  
|           | Overview By Business Segment                               | 30  
|           | Transportation Infrastructure                              | 60  
|           | Property, Plant and Equipment                              | 83  
|ITEM 4.A.  | Unresolved Staff Comments                                  | 83  
|ITEM 5.    | Operating and Financial Review and Prospects               | 83  
|           | Operating Results                                          | 91  
|           | Liquidity and Capital Resources                            | 104 
|           | Research and Development, Patents and Licenses, etc.       | 107 
|           | Off-Balance Sheet Arrangements                             | 108 
|           | Tabular Disclosure of Contractual Obligations              | 108 
|ITEM 6.    | Directors, Senior Management and Employees                 | 108 
|           | Directors and Senior Management                            | 108 
|           | Compensation                                               | 113 
|           | Share Ownership                                            | 113 
|           | Board Practices                                            | 114 
|           | Employees                                                  | 115 
|ITEM 7.    | Major Shareholders and Related Party Transactions          | 118 
|           | Major Shareholders                                         | 118 
|           | Related Party Transactions                                 | 119 
|ITEM 8.    | Financial Information                                      | 124 
|           | Consolidated Statements And Other Financial Information    | 124 
|           | Legal Proceedings                                          | 124 
|           | Dividends                                                  | 126 
|           | Significant Changes                                        | 126 
|ITEM 9.    | The Offer and Listing                                      | 126 
|           | Trading Markets                                            | 126 
|           | Trading On The Bolsa De Valores De Colombia                | 128 
|ITEM 10.   | Additional Information                                     | 129 
|           | Bylaws                                                     | 129 
|           | Material Contracts                                         | 133 
|           | Exchange Controls                                          | 134 
|           | Taxation                                                   | 135 
|           | Documents On Display                                       | 141 
|ITEM 11.   | Quantitative and Qualitative Disclosures About Market Risk | 141 
|ITEM 12.   | Description of Securities Other than Equity Securities     | 144 
|ITEM 12.A. | Debt Securities                                            | 144 
|ITEM 12.B. | Warrants and Rights                                        | 144 
|ITEM 12.C. | Other Securities                                           | 144 



-i-







|ITEM 12.D. | American Depositary Shares                                                   | 144
|---------- | ---------------------------------------------------------------------------- | ---
|ITEM 13.   | Defaults, Dividend Arrearages and Delinquencies                              | 145
|ITEM 14.   | Material Modifications to the Rights of Security Holders and Use of Proceeds | 145
|ITEM 15.   | Controls and Procedures                                                      | 145
|ITEM 16.   | [Reserved]                                                                   | 147
|ITEM 16.A. | Audit Committee Financial Expert                                             | 147
|ITEM 16.B. | Code of Ethics                                                               | 147
|ITEM 16.C. | Principal Accountant Fees and Services                                       | 147
|           | Audit and Non-Audit Fees                                                     | 147
|ITEM 16.D. | Exemptions from the Listing Standards for Audit Committees                   | 149
|ITEM 16.E. | Purchases of Equity Securities by the Issuer and Affiliated Purchasers       | 149
|ITEM 16.F. | Change in Registrant’s Certifying Accountant                                 | 149
|ITEM 16.G. | Corporate Governance                                                         | 149
|ITEM 16.H. | Mine Safety Disclosure                                                       | 151
|ITEM 17.   | Financial Statements                                                         | 151
|ITEM 18.   | Financial Statements                                                         | 151
|ITEM 19.   | Exhibits                                                                     | 151



-ii-









Forward-Looking
Statements



This annual report on
Form 20-F contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation
Reform Act of 1995. These statements are not based on historical facts and reflect our expectations for future events and results.
Most facts are uncertain because of their nature. Words such as “anticipate,” “believe,” “could,”
“estimate,” “expect,” “should,” “plan,” “potential,” “predicts,”
“prognosticate,” “project,” “target,” “achieve” and “intend,” among
other similar expressions, are understood as forward-looking statements. We have made forward-looking statements that address,
among other things:



| | · | our exploration and production activities, including drilling;
| | - | --------------------------------------------------------------



| | · | import and export activities;
| | - | -----------------------------



| | · | our liquidity, cash flow, and sources of funding;
| | - | -------------------------------------------------



| | · | our projected and targeted capital expenditures and other cost commitments and revenues; and
| | - | --------------------------------------------------------------------------------------------



| | · | dates by which certain areas will be developed or will come on-stream.
| | - | ----------------------------------------------------------------------



Our forward-looking statements
are not guarantees of future performance and are subject to assumptions that may prove incorrect and to risks and uncertainties
that are difficult to predict. Actual results could differ materially from those expressed or forecast in any forward-looking statements
as a result of a variety of factors. These factors may include, but are not limited to, the following:



| | · | general economic and business conditions, including crude oil and other commodity prices, refining
margins and prevailing exchange rates;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------



| | · | competition;
| | - | ------------



| | · | our ability to obtain financing;
| | - | --------------------------------



| | · | our ability to find, acquire or gain access to additional reserves and our ability to develop existing
reserves;
| | - | ----------------------------------------------------------------------------------------------------------------



| | · | uncertainties inherent in making estimates of our reserves;
| | - | -----------------------------------------------------------



| | · | significant political, economic and social developments in Colombia and other countries where we do
business;
| | - | -------------------------------------------------------------------------------------------------------------



| | · | natural disasters, military operations, terrorist acts, wars or embargoes;
| | - | --------------------------------------------------------------------------



| | · | regulatory developments, including regulations related to climate change;
| | - | -------------------------------------------------------------------------



| | · | receipt of government approvals and licenses;
| | - | ---------------------------------------------



| | · | technical difficulties; and
| | - | ---------------------------



| | · | other factors discussed in this document as “Risk Factors.”
| | - | -----------------------------------------------------------



All forward-looking statements
attributed to us are qualified in their entirety by this cautionary statement. We undertake no obligation to publicly update or
revise any forward-looking statements, whether as a result of new information or for any other reason. Accordingly, readers should
not place undue reliance on the forward-looking statements contained in this annual report.



-1-







The crude oil and natural
gas reserve data presented or described in this annual report are only estimates and our actual production, revenues and expenditures
with respect to our reserves may materially differ from these estimates.



Enforcement
of Civil Liabilities



We are a Colombian company.
All of our Directors and executive officers and some of the experts named in this annual report reside outside the United States. All
or a substantial portion of our assets and the assets of these persons are located outside of the United States. As a result,
it may not be possible for you to effect service of process within the United States upon us or these persons or to enforce against
us or them judgments in U.S. courts obtained in such courts predicated upon the civil liability provisions of the U.S. federal
securities laws. Colombian courts will determine whether to enforce a U.S. judgment predicated on the U.S. securities laws
through a proceeding known as exequatur. The Colombian Supreme Court will enforce a foreign judgment, without reconsideration
of the merits only if the judgment satisfies the following requirements:



| | · | a treaty exists between Colombia and the country where the judgment was granted or there is reciprocity
in the recognition of foreign judgments between the courts of the relevant jurisdiction and the courts of Colombia;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | the foreign judgment does not relate to “in rem rights” vested in assets that were
located in Colombia at the time the suit was filed and does not contravene or conflict with Colombian laws relating to public order
other than those governing judicial procedures;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | the foreign judgment, in accordance with the laws of the country where it was rendered, is final and
is not subject to appeal and a duly certified and authenticated copy of the judgment has been presented to a competent court in
Colombia;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | the foreign judgment does not refer to any matter upon which Colombian courts have exclusive jurisdiction;
| | - | ----------------------------------------------------------------------------------------------------------



| | · | no proceeding is pending in Colombia with respect to the same cause of action, and no final judgment
has been awarded in any proceeding in Colombia on the same subject matter and between the same parties; and
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | in the proceeding commenced in the foreign court that issued the judgment, the defendant is served
in accordance with the laws of such jurisdiction and in a manner reasonably designated to give the defendant an opportunity to
defend against the action.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The United States and
Colombia do not have a bilateral treaty providing for automatic reciprocal recognition and enforcement of judgments in civil and
commercial matters. The Colombian Supreme Court has in the past accepted that reciprocity exists when it has been proven that either
a U.S. court has enforced a Colombian judgment or that a U.S. court would enforce a foreign judgment, including a judgment issued
by a Colombian court. However, such enforceability decisions are considered by Colombian courts on a case-by-case basis.



Presentation
of Financial Information



Unless the context
otherwise requires, the terms “Ecopetrol,” “we,” “us,” “our” or the
“Company” are used in this annual report to refer to Ecopetrol S.A. and its subsidiaries on a consolidated
basis.



In this annual report,
references to “US$” or “U.S. dollars” are to United States dollars and references to “Ps$,”
“Peso” or “Pesos” are to Colombian Pesos, the functional currency under which we prepare our financial
statements. Certain figures shown in this annual report have been subject to rounding adjustments and, accordingly, certain totals
may therefore not precisely equal the sum of the numbers presented. In this annual report abillion is equal to one
with nine zeros.



-2-







Our consolidated financial
statements are prepared in accordance with accounting principles for Colombian state-owned entities issued by the Colombian National
Accounting Office (Contaduría General de la Nación), or CGN, and other applicable legal provisions.



Our consolidated financial
statements at and for the years ended December 31, 2013, 2012 and 2011 and the selected financial data at and for the years
ended December 31, 2013, 2012, 2011, 2010 and 2009 have been prepared under the Public Accounting Regime (Régimen
de Contabilidad Pública), or RCP, as adopted by the CGN in September, 2007 and applicable to Ecopetrol beginning with
the fiscal year ended December 31, 2008. See Note 1 to our consolidated financial statements included in this Annual Report.
We refer to RCP as Colombian Government Entity GAAP. Colombian Government Entity GAAP differs in certain significant respects from
generally accepted accounting principles in the United States, or U.S. GAAP. Note 35 to our consolidated financial statements included
in this annual report provides a description of the principal differences between Colombian Government Entity GAAP and U.S. GAAP
as they relate to our audited consolidated financial statements and provides a reconciliation of net income and shareholders’
equity for the years and dates indicated therein. As a state-owned company, our consolidated financial statements are periodically
reviewed by the CGN. However, the review of our accounts by the CGN does not constitute an audit.



We are in the process
of transitioning our financial reporting to International Financial Reporting Standards. For more information on our transition
to IFRS, please see Note 1(aa) to our consolidated financial statements.



The accompanying audited
consolidated financial statements of Ecopetrol and our consolidated subsidiaries for the years ended December 31, 2013, 2012
and 2011 have been prepared from accounting records, which are maintained under the historical cost convention as modified in 1992,
to comply with the legal provisions of the CGN.



Certain line items from our consolidated financial statements as of December 31, 2011 and 2012 related
to the presentation of the consolidated Balance Sheet and the Consolidated Statement of Financial, Economic, Social and Environmental
Activities have been reclassified in order to make the presentation of such financial statements comparable to that of our financial
statements as of December 31, 2013. The main reclassifications were under cost of sales, operational expenses, marketing and
projects, accounts payable and related parties, taxes, contributions and duties payable, deposits held in trust and other assets.



Our consolidated financial
statements were consolidated line by line and all transactions and significant balances between affiliates have been eliminated.
These financial statements include the financial results of the following companies:





|COMPANY                                                      |  | OWNERSHIP
    % (as of Dec. 31, 2013) |        |  | Included in consolidated Financial Statements for the year ended | 
|------------------------------------------------------------ |  | ------------------------------------- | ------ |  | ---------------------------------------------------------------- | 
|                                                             |  |                                       |        |  | 2013                                                             | 
|Black Gold Re Ltd.                                           |  |                                       | 100.00 |  |                                                                  | 
|Ecopetrol Óleo e Gás do Brasil Ltda.                         |  |                                       | 100.00 |  |                                                                  | 
|Ecopetrol del Perú S.A.                                      |  |                                       | 100.00 |  |                                                                  | 
|Ecopetrol America Inc.                                       |  |                                       | 100.00 |  |                                                                  | 
|Andean Chemicals Ltd.                                        |  |                                       | 100.00 |  |                                                                  | 
|Polipropileno del Caribe S.A. (Propilco)                     |  |                                       | 100.00 |  |                                                                  | 
|Ecopetrol Global Energy SLU                                  |  |                                       | 100.00 |  |                                                                  | 
|Refinería de Cartagena S.A. (Reficar)                        |  |                                       | 100.00 |  |                                                                  | 
|COMAI Compounding and Masterbatching Industry Ltda.          |  |                                       | 100.00 |  |                                                                  | 
|Hocol Petroleum Ltd.                                         |  |                                       | 100.00 |  |                                                                  | 
|Ecopetrol Capital AG                                         |  |                                       | 100.00 |  |                                                                  | 
|Ecopetrol Pipelines International Limited                    |  |                                       | 100.00 |  |                                                                  | 
|Ecopetrol Global Capital SL                                  |  |                                       | 100.00 |  |                                                                  | 
|Cenit Transporte y Logística de Hidrocarburos S.A.S (Cenit). |  |                                       | 100.00 |  |                                                                  | 
|Ecopetrol Transportation Company Ltd (1).                    |  |                                       | 100.00 |  |                                                                  | 
|Ecopetrol Transportation Investment Ltd (1)                  |  |                                       | 100.00 |  |                                                                  | 
|Bioenergy S.A.                                               |  |                                       | 91.43  |  |                                                                  | 
|ODL Finance S.A.                                             |  |                                       | 65.00  |  |                                                                  | 
|Oleoducto Central S.A. (Ocensa)                              |  |                                       | 72.65  |  |                                                                  | 
|Oleoducto de Colombia (ODC)                                  |  |                                       | 73.00  |  |                                                                  | 
|Equión Energía Limited (Equión)                              |  |                                       | 51.00  |  |                                                                  | 
|Oleoducto Bicentenario de Colombia S.A.S                     |  |                                       | 55.97  |  |                                                                  | 





| | (1) | In 2012, Ecopetrol Transportation Company Ltd and Ecopetrol Transportation Investment Ltd merged
with Ecopetrol Pipelines International Ltd.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------



-3-







This annual report translates certain Peso
amounts into U.S. dollars at specified rates solely for the convenience of the reader. Unless otherwise indicated, such Peso amounts
have been translated at the rate of Ps$1,926.83 per US$1.00, which corresponds to the Tasa Representativa del Mercado(TRM),
or Representative Market Exchange Rate, for December 31, 2013. The Representative Market Exchange Rate is computed and certified
by the Superintendencia Financiera,or Superintendency of Finance, the Colombian banking and securities regulator, on a
daily basis and represents the weighted average of the buy and sell foreign exchange rates negotiated on the previous day by financial
institutions authorized to engage in foreign exchange transactions. The Superintendency of Finance also calculates the Representative
Market Exchange Rate for each month for purposes of preparing financial statements and converting amounts in foreign currency to
Pesos. Such conversion should not be construed as a representation that the Peso amounts correspond to, or have been or could be
converted into, U.S. dollars at that rate or any other rate. On April 25, 2014, the Representative Market Exchange Rate was Ps$1,936.07 per US$1.00.



Presentation
of Abbreviations



The following is a list
of crude oil and natural gas measurement abbreviations commonly used throughout this annual report.



|bpd   |  | Barrels per day                   
|----- |  | ----------------------------------
|boe   |  | Barrels of oil equivalent         
|boepd |  | Barrels of oil equivalent per day 
|btu   |  | British thermal units             
|cf    |  | Cubic feet                        
|cfpd  |  | Cubic feet per day                
|mcf   |  | Million cubic feet                
|mcfpd |  | Million cubic feet per day        
|mbtu  |  | Million British thermal units     
|gbtu  |  | Giga British thermal units        
|gbtud |  | Giga British thermal units per day
|bcf   |  | Billion Cubic feet                



Presentation
of The Nation and Government of Colombia



References to the Nation
in this annual report relate to the Republic of Colombia, our controlling shareholder. References made to the Government of Colombia
or the Government correspond to the executive branch including the President of Colombia, the ministries and other governmental
agencies responsible for regulating our business.



-4-







Presentation
of Information Concerning Reserves



The estimates of our proved
reserves of crude oil and natural gas included in this annual report have been calculated according to the technical definitions
required by the U.S. Securities and Exchange Commission, or SEC. Our hydrocarbon net proved reserves have been audited in
2013 by Ryder Scott Company L.P., DeGolyer and MacNaughton and Gaffney, Cline & Associates Inc., which we refer to collectively
as the External Engineers, and their reserves reports are included as exhibits herein. All reserve estimates involve some degree
of uncertainty. See “Item 4. Information on the Company—Overview by Business Segment—Exploration and
Production—Reserves” for additional information on our reserves estimates.



The following table sets
forth the percentage of our estimated net proved reserves audited by External Engineers and the percentage calculated internally
for the years ended December 31, 2013, 2012 and 2011. Our proved reserves as of December 31, 2013, 2012 and 2011 are
based on the SEC average price methodology for purposes of both Colombian Government Entity GAAP and U.S. GAAP. See “Item 3.
Key Information—Risk Factors—Risks related to our business” for a description of the risks relating to our reserves
and our reserve estimates.



|                                                      |  | Estimated proved reserves for the year ended December 31, |   
|----------------------------------------------------- |  | --------------------------------------------------------- | --
|                                                      |  | 2013                                                      |   
|Net proved reserves audited by External Engineers     |  |                                                           | 99
|Net proved reserves estimates on our own calculations |  |                                                           | 1 



We are required, as are
all oil companies undertaking exploratory and production activities in Colombia, to pay a percentage of our production to the Government
as royalties. The oil and gas reserve figures included in this annual report are net of such royalties.



| | ITEM 1. | Identity of Directors, Senior Management and Advisors
| | ------- | -----------------------------------------------------



Not applicable.



| | ITEM 2. | Offer Statistics and Expected Timetable
| | ------- | ---------------------------------------



Not applicable.



| | ITEM 3. | Key Information
| | ------- | ---------------



Selected
Financial Data



The following table sets
forth, for the periods and at the dates indicated, our selected historical financial data, which have been derived from and should
be read in conjunction with, and are qualified in their entirety by reference to, our consolidated audited financial statements,
presented in Pesos. PricewaterhouseCoopers Ltda. audited our consolidated financial statements for the year ended December 31,
2013. KPMG Ltda. audited our consolidated financial statements for the years ended December 31, 2012 and 2011. Our consolidated
financial statements for the years ended December 31, 2010 and 2009 were audited by PricewaterhouseCoopers Ltda. The information
included below and elsewhere in this annual report is not necessarily indicative of our future performance. See also “Item 5.
Operating and Financial Review and Prospects” in this annual report.



Colombian Government Entity
GAAP differs in certain significant respects from U.S. GAAP. Note 35 to our consolidated financial statements included in this
annual report provides a description of the principal differences between Colombian Government Entity GAAP and U.S. GAAP as they
relate to our financial statements and provides a reconciliation to U.S. GAAP of net income and shareholders’ equity for
the years and dates indicated therein.



-5-







|                                         |  | BALANCE
    SHEET                                                                          |               
|---------------------------------------- |  | ------------------------------------------------------------------------------------------ | --------------
|                                         |  | For
    the year ended December 31,                                                        |               
|                                         |  | 2013(1)                                                                                    |               
|                                         |  | (US$ in thousands except
    for
    common share and
    dividends per share
    amounts) |               
|                                         |  |                                                                                            |               
|Total assets                             |  |                                                                                            | 68,728,426    
|Shareholders’ Equity                     |  |                                                                                            | 36,909,952    
|Subscribed capital                       |  |                                                                                            | 5,334,760     
|Number of common shares                  |  |                                                                                            | 41,116,698,456
|Dividends declared per
    share(3)      |  |                                                                                            | 0.13          
|Amounts
    in accordance with U.S. GAAP |  |                                                                                            |               
|Total Assets                             |  |                                                                                            | 47,584,850    
|Shareholders’ Equity                     |  |                                                                                            | 21,732,704    
|                                         |  |                                                                                            |               
|Number of common shares                  |  |                                                                                            | 41,116,698,456
|Dividends declared per
    share(3)      |  |                                                                                            | 0.13          










| | (1) | Amounts stated in U.S. dollars have been translated for the convenience of the reader at the rate
of Ps$ 1,926.83 to US$1.00, which is the Representative Market Exchange Rate as of December 31, 2013, as reported and certified
by the Superintendency of Finance.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | The number of common shares includes 644,185,868 shares issued to the public in connection with
our second offering of shares in Colombia in September 2011.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | Represents dividends declared in 2013, 2012, 2011, 2010 and 2009, based on net income for the years ended
December 31, 2012, 2011, 2010, 2009 and 2008 respectively.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                                                          |  | INCOME
    STATEMENT                                                                                        |               
|--------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------- | --------------
|                                                          |  | For
    the year ended December 31,                                                                         |               
|                                                          |  | 2013(1)                                                                                                     |               
|                                                          |  | (US$
    in thousands except for net
    income per share
    and average
    number of shares
    amounts) |               
|                                                          |  |                                                                                                             |               
|Total
    revenue                                         |  |                                                                                                             | 36,551,597    
|Operating
    income                                      |  |                                                                                                             | 11,331,944    
|Net
    operating income per share                        |  |                                                                                                             | 0.28          
|Income
    before income tax and non-controlling interest |  |                                                                                                             | 11,356,584    
|Net
    income                                            |  |                                                                                                             | 6,802,107     
|Weighted
    average number of shares outstanding         |  |                                                                                                             | 41,116,698,456
|Net
    income per share(3)                               |  |                                                                                                             | 0.17          
|Amounts
    in accordance with U.S. GAAP                  |  |                                                                                                             |               
|                                                          |  |                                                                                                             |               
|Total
    revenue                                         |  |                                                                                                             | 35,515,663    
|Operating
    income                                      |  |                                                                                                             | 12,102,747    
|Net
    operating income per share                        |  |                                                                                                             | 0.29          
|Income
    before income tax                              |  |                                                                                                             | 12,072,348    
|Net
    income attributable to Ecopetrol                  |  |                                                                                                             | 7,238,238     
|Net
    income per share                                  |  |                                                                                                             | 0.18          
|Weighted
    average number of shares outstanding(4)      |  |                                                                                                             | 41,116,698,456












| | (1) | Amounts stated in U.S. dollars have been translated for the convenience of the reader at the rate
of Ps$1,926.83 to US$1.00, which was the Representative Market Exchange Rate as of December 31, 2013, as reported and certified
by the Superintendency of Finance.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | The weighted average number of common shares outstanding reflect the issuance of 644,185,868 shares
to the public in connection with our second offering of shares in Colombia in September 2011.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | Net income per share is calculated using the weighted-average number of outstanding shares during
the year.
| | --- | -----------------------------------------------------------------------------------------------------------



| | (4) | Calculated in accordance with U.S. GAAP, which differs in certain respects from the calculation
of weighted average number of shares pursuant to Colombian Government Entity GAAP.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-6-







Exchange
Rate Information



On April 25, 2014, the Representative Market
Exchange Rate was Ps$1,936.07 per US$1.00. The Federal Reserve Bank of New York does not report a noon-buying rate for Colombian
Pesos. The Superintendency of Finance calculates the Representative Market Exchange Rate based on the weighted averages of the
buy and sell foreign exchange rates quoted daily by foreign exchange rate market intermediaries including financial institutions
for the purchase and sale of U.S. dollars.







The following table sets
forth the high, low, average and period-end exchange rate for Peso/U.S. dollar Representative Market Exchange Rate for each of
the last five years and for the last six months.



|                         |  | Exchange Rates |         
|------------------------ |  | -------------- | --------
|                         |  | High           |         
|                         |  |                |         
|2009                     |  |                | 2,596.37
|2010                     |  |                | 2,044.23
|2011                     |  |                | 1,972.76
|2012                     |  |                | 1,942.70
|2013                     |  |                | 1,952.11
|October                  |  |                | 1,908.29
|November                 |  |                | 1,932.77
|December                 |  |                | 1,948.48
|                         |  |                |         
|2014:                    |  |                |         
|January                  |  |                | 2,013.17
|February                 |  |                | 2,054.90
|March                    |  |                | 2,052.51
|April (through April 25) |  |                | 1,969.45



Source:
Superintendency of Finance for historical data. Banco de la República, or the Colombian Central Bank, for averages.



Risk Factors



Risks related to our business



Our crude oil and natural gas
reserve estimates involve some degree of uncertainty and may prove to be incorrect over time, which could adversely affect our
ability to generate revenue.



Reserves estimates are
prepared using generally accepted geological and engineering evaluation methods and procedures. Estimates are based on geological,
topographical and engineering facts. Hydrocarbon reserves were calculated in accordance with SEC regulations and the requirements
of the Financial Accounting Standards Board, or FASB. Actual reserves and production may vary materially from estimates presented
in this annual report, and downward revisions in our reserve estimates could lead to lower future production which could affect
our results of operations and financial condition. For more information, see “Item 4. Information on the Company –
Reserves.”



-7-







Achieving our long-term growth
prospects depends on our ability to execute our Strategic Plan — specifically, the discovery and successful development
of additional reserves.



Our Strategic Plan is
discussed at length in “Item 4. Information on the Company—The Company—Our Strategic Plan.” Our long-term
growth objectives depend largely on our ability to discover and/or acquire new reserves, and in turn successfully develop them
and to improve our recovery factor. Our exploration activities expose us to the inherent risks of drilling, including the risk
that we will not discover commercially productive crude oil or natural gas reserves and the risk that some exploratory wells initially
budgeted for may be drilled at a later stage or not be drilled at all. The costs associated with drilling wells are often uncertain,
and numerous factors beyond our control may cause drilling operations to be curtailed, delayed or cancelled.



If we are unable to successfully
discover and develop additional reserves, or if we do not acquire properties having proved reserves, our level of proved reserves
will decline. Failure to secure additional reserves may impede us from achieving or maintaining production targets, and may have
a negative impact on our results of operation and financial condition.



Our business depends substantially
on international prices for crude oil and refined products. The prices for these products are volatile; a sharp decrease could
adversely affect our business prospects and results of operations.



As of December 2013, nearly
95% of our revenues came from sales of crude oil, natural gas and refined products and 99% of our revenues from the sales of these
products are indexed to international reference prices or benchmarks such as brent and fuel oil. Consequently, fluctuations in
those international indexes have a direct effect on our financial condition and results of operations.



Prices of crude oil, natural
gas and refined products have traditionally fluctuated as a result of a variety of factors including, among others, competition
within the oil and natural gas industry; changes in international prices of natural gas and refined products; long-term changes
in the demand for crude oil, natural gas and refined products; regulatory changes; inventory levels; changes in the cost of capital;
adverse economic conditions; global financial crises, such as the financial crisis of 2008; development of new technologies; global
and regional economic and political developments in the Organization of the Petroleum Exporting Countries, or OPEC; the willingness
and ability of the OPEC and its members to set production levels and prices; local and global demand and supply for crude oil,
refined products and natural gas; trading activity in oil and natural gas; transactions in derivative financial instruments related
to oil and gas; development or availability of alternative fuels; weather conditions; natural events or disasters; and terrorism
and global conflict.



Substantial or extended
declines in international crude oil prices may have a material adverse effect on our business, results of operations and financial
condition, and the value of our proved reserves. In addition, a reduction of international crude oil prices could result in a delay
or a change in our capital expenditure plan, in particular delaying exploration and development activities, thereby delaying the
development of reserves and affecting future cash flows.



An appreciation of the Peso against
the U.S. dollar could have an adverse effect on our financial condition and results of operations given that approximately 99%
of our revenues are derived from sales of products quoted in or with reference to U.S. dollars.



Approximately 99% of our
revenues are derived from sales of products quoted in or with reference to U.S. dollars. The impact of fluctuations in exchange
rates, especially the Peso/U.S. dollar rate, on our operations has been and may continue to be material. In addition, a substantial
share of our liquid assets are held in U.S. dollars and gain value when converted into Pesos as the Peso depreciates against the
U.S. dollar and lose value when converted into Pesos as the Peso appreciates against the U.S. dollar.



-8-







The U.S. dollar/Peso exchange
rate has fluctuated during the last several years. The Peso appreciated 2.7% on average against the U.S. dollar in 2012, and in
2013 depreciated 3.9%. When the Peso appreciates against the U.S. dollar, our revenues from exports decrease when converted into
Pesos. However, imported goods, oil services and interest on external debt denominated in U.S. dollars become less expensive for
us. Conversely, when the Peso depreciates against the U.S. dollar, our revenues from exports, when converted into Pesos, increase,
and our imports and external debt service become more expensive. Because of our current composition of revenues as described above
and the fact that our assets and liabilities are denominated in U.S. dollars and our assets are almost twice as much as our liabilities,
we prefer the depreciation of the Peso against the U.S. dollar. We cannot assure that measures adopted by the government of Colombia
and the Colombian Central Bank (Banco de la República de Colombia) such as the purchase of U.S. dollars in the foreign
exchange market in response to the appreciation of the Peso, and  the government’s intervention through the purchase
of significant amounts of U.S. dollars in the spot market to pay interest and principal on foreign bonds coming due will be sufficient
to control this fluctuation. Future appreciation in the exchange rate of the Peso to the U.S. dollar may adversely affect our financial
condition and results of operations when converted into Pesos and our ability to comply with our obligations under our existing
indebtedness and our ability to pay dividends.



Increased competition from local
and foreign crude oil companies may have a negative impact on our ability to gain access to additional crude oil and natural gas
reserves in Colombia.



Prior to the enactment
of Decree Law 1760 of 2003, we had an automatic right to explore any territory in Colombia and to enter into joint venture agreements
with foreign and local oil companies. Under current law, by contrast, we no longer have unfettered ability to engage in exploratory
activities; we must instead bid for exploration blocks offered by the ANH, the governmental entity responsible for promoting oil
and gas investments in Colombia, establishing terms of reference for exploration rounds and assigning exploration blocks to domestic
and foreign oil and gas companies via competitive rounds. This means we compete under the same conditions as other domestic and
foreign oil and gas companies, and receive no special treatment. Our ability to obtain access to potential production fields also
depends on our ability to evaluate and select potential hydrocarbon-producing fields and to adequately bid for these exploration
fields.



We are also exposed to
international competition as a result of our international exploratory activities. Currently, we are developing exploratory activities
in Brazil, Peru and the Gulf of Mexico, where we face competition from other oil and gas companies operating in those locations.



If we are unable to adequately
compete with local and foreign oil companies, or if we cannot enter into joint ventures with market players with exploration projects
where we could potentially find additional reserves, we may be limited to conducting exploration activities in less attractive
blocks. This could reduce our share of the market and, in turn, adversely affect our financial condition.



If operational risks to which
we are exposed in Colombia or overseas materialize, the health and safety of our workforce, the local community and the environment
may be affected. In addition, we may suffer a disruption or shutdown of our operational activities.



Our exploration, production,
refining and transportation activities in Colombia and in the foreign countries in which we operate are subject to industry-specific
operating risks, some of which, despite our internal procedures and adherence to industry practices, are beyond our control. Our
operations may be curtailed, delayed or cancelled due to adverse or abnormal weather conditions, natural disasters, equipment failures
or accidents, oil or natural gas spills or leaks, shortages or delays in the availability or in the delivery of equipment, delays
or cancellation of environmental licenses or other government authorizations, fires, explosions, blow-outs, surface cratering,
pipeline failures, theft and damage to our transportation infrastructure, sabotage, terrorist attacks and criminal activities.



Some of our operations
in Colombia and abroad could be conducted in remote and uninhabited locations which involve health and safety risks that could
affect our workforce. By our own Company policy and practices, as well as under Colombian law and international industrial safety
regulations, we are required to have health and safety practices that minimize risks and health issues faced by our workforce.
Failure to comply with health and safety regulations in the jurisdictions where we operate may lead to investigations by health
officials that could result in lawsuits or fines.



-9-







We may be required to
incur additional costs and expenses to allocate funds to industrial safety and health compliance under Colombian law and international
industrial safety regulations. Additionally, if any operational incident occurs that affects local communities in nearby areas,
we will need to incur additional costs and expenses in order to return affected areas to normality and to compensate for any damages
we may cause. These additional costs may have a negative impact on the profitability of the projects we may decide to undertake.



The occurrence of any
of these operating risks could result in substantial losses or slowdowns to our operations, including injury to our employees,
malfunction or destruction of property, equipment and infrastructure, clean-up responsibilities, third-party liability claims,
government investigations and imposition of fines, withdrawal of environmental licenses and other government permits, suspension
or shutdown of our activities and loss of revenue. The occurrence of any of these events may have a material adverse effect on
our financial condition and results of operations.



Our involvement in deep water
drilling either as direct operators or in conjunction with our business partners involves certain risks and costs, which may be
outside of our control.



Ecopetrol plans to spud
two or three offshore exploration wells in the deep waters of the Colombian Caribbean Sea during 2014; all of them will be operated
by our partners in the Tayrona and Fuerte Norte and Sur blocks (Petróleo Brasileiro S.A.—Petrobras and Anadarko Petroleum
Corporation, respectively). Ecopetrol will continue its exploration campaign in the Colombian Caribbean Sea in 2015 and 2016, with
three to four new exploration wells planned, in association with our business partners, such as Repsol and ONGC Videsh Limited,
among others. In association with our business partners, we have undertaken deep water exploratory drilling in the U.S. Gulf Coast
and in Brazil. Additionally, as of December 31, 2013, we were involved in off-shore productionoperations on the Colombian Caribbean coast where Chevron acts as operator and 18 off-shore exploratory blocks in Colombia
that involve deep-water drilling, in four of which Ecopetrol S.A. acts as operator, while Equión acts as operator in two.
Our deep water drilling activities present several risks, such as the risk of spills, explosions in platforms and drilling operations,
and natural disasters. The occurrence of any of these events or other incidents could result in personal injuries, loss of life,
severe environmental damage with the resulting containment, clean-up and repair expenses, equipment damage and liability in civil
and administrative proceedings. Heightened risks and costs associated with deep water drilling may have a negative effect on our
results of operations, financial condition and reputation.



As a result of the oil
spill in the Macondo field operated by British Petroleum in the U.S. Gulf Coast in April 2010, significant concerns regarding the
safety of deep water drilling have been raised and, as a result, applicable regulations in various countries have changed. More
stringent government regulation may result in increased costs and longer exploration and development timeframes for our deep water
drilling operations and consequently could adversely affect our results of operations and financial condition.



We are exposed to the credit risks
of our customers and any material nonpayment or nonperformance by our key customers could adversely affect our cash flow and results
of operations.



Some of our customers
may experience financial problems that could have a significant negative effect on their creditworthiness. Severe financial problems
encountered by our customers could limit our ability to collect amounts owed to us, or to enforce the performance of obligations
owed to us under contractual arrangements. In addition, many of our customers finance their activities through their cash flows
from operations, the incurrence of short and long term debt or the issuance of equity.



The combination of decreasing
cash flows as a result of declines in commodity prices, a reduction in borrowing bases under reserve-based credit facilities and
the lack of availability of debt or equity financing may result in a significant reduction of our customers’ liquidity and
limit their ability to make payments or perform their obligations to us.



Furthermore, some of our
customers may be highly leveraged and subject to their own operating expenses. Therefore, the risk we face in doing business with
these customers may increase. Other customers may also be subject to regulatory changes, which could increase the risk of defaulting
on their obligations to us. For example, constraints on foreign currency transactions by the Venezuelan government have resulted
in delays by PDVSA Gas to make payments to its suppliers, including us. Financial problems experienced by our customers could result
in the impairment of our assets, a decrease in our operating cash flows and may also reduce or curtail our customers’ future
use of our products and services, which may have an adverse effect on our revenues and our ability to make payments under our existing
debt obligations.



-10-







Our ability to access the credit
and capital markets on favorable terms to obtain funding for our capital projects may be limited due to the deterioration of these
markets and the authorizations we need before incurring any financial indebtedness.



We expect to make significant
capital and operations expenditures to reach the corporate goals established by our Strategic Plan. See “Item 4. Information
on the Company—The Company—Our Strategic Plan.” Our ability to fund these expenditures is dependent on our ability
to access the capital necessary to finance them on terms acceptable to us. In recent years, domestic and global financial markets
and economic conditions have been weak and volatile and have contributed significantly to a substantial deterioration in the credit
and capital markets. A new financial crisis or a renewal of the European sovereign debt crisis, which in turn could worsen the
risk perception in the emerging markets, could also make it more difficult for us and our subsidiaries to access international
capital markets and finance our operations and capital expenditures in the future on terms acceptable to us. These conditions,
along with significant write-offs in the financial services sector and the re-pricing of credit risk, can make it difficult for
us to obtain funding for our capital needs on favorable terms. As a result, we may be forced to revise the timing and scope of
these projects as necessary to adapt to existing market and economic conditions, or access the financial markets on terms less
favorable, therefore negatively affecting our results of operations and financial condition.



In addition, under applicable
regulation, the Government, through the Ministry of Finance and Public Credit and the National Planning Department, must authorize
all indebtedness of state-owned entities and government-controlled companies through a majority equity stake. Consequently, all
of our own indebtedness and our subsidiaries’ indebtedness, except for our foreign subsidiaries or those subsidiaries in
which we hold minority interest, must be previously authorized by the Colombian Ministry of Finance and Public Credit and the National
Planning Department. As such, our indebtedness is subject to the Government’s time frames and policies, and we cannot guarantee
that such authorizations would be granted in a timely fashion or granted at all.



We may be exposed to increases
in interest rates, thereby increasing our financial costs.



We may incur debt locally
and in the international capital markets and, consequently, may be affected by changes in prevailing interest rates. If market
interest rates increase, our financing expenses may increase, which could have an adverse effect on our results of operations and
financial condition.



As of December 31,
2013, approximately 42%—US$4.8 billion of our total indebtedness—consisted of floating rate debt. If market interest
rates rise, our financing expenses will increase, which could have an adverse effect on our results of operations and financial
condition. In addition, as we refinance our existing debt in the coming years, the mix of our indebtedness may change, specifically
as it relates to the ratio of fixed to floating interest rates, the ratio of short-term to long-term debt, and the currencies in
which our debt is denominated in or indexed to. We cannot assure you that such changes will not result in increased financing expenses
borne by us.



Our current and planned investments
and exploration activities outside Colombia are exposed to political and economic risks.



As part of our Strategic
Plan, we operate through business partners, subsidiaries or affiliates outside of Colombia. We currently have investments and
subsidiaries incorporated in Peru, Brazil, Bermuda, Panama, the Cayman Islands, Switzerland, Spain, the United Kingdom and the
United States, and we are analyzing investments in other countries. In connection with making investments, we are and will be subject
to risks relating to economic and political conditions and governmental economic actions. We cannot predict the positions of foreign
governments relating to the oil and gas industry, land tenure, protection of private property, environmental standards, regulation
or taxation; nor can we assure you that future governments will maintain policies favorable to foreign investment or repatriation
of capital.



-11-







We began exploration activities
outside Colombia in 2006 through our Brazilian subsidiary, Ecopetrol Óleo e Gás do Brasil Ltda. Our foreign subsidiaries
have subsequently entered into a number of joint venture exploration agreements with regional and international oil companies to
explore blocks in Peru, Brazil and the U.S. Gulf Coast. We have limited experience exploring outside Colombia. We may face new
and unexpected risks involving environmental and other legal requirements beyond those we currently face.



The results of operations
and financial condition of our subsidiaries in these countries also may be adversely affected not only by risks associated with
hydrocarbon exploration and production, but also by fluctuations in their local economies, political instability and government
actions, including: the imposition of price controls, the imposition of restrictions on hydrocarbon exports, fluctuation of local
currencies against the Peso, the nationalization of oil and gas reserves, increases in export tax and income tax rates for crude
oil and oil products, and unilateral (governmental) institutional and contractual changes, including controls on investments and
limitations on new projects.



Any of these conditions
occurring could disrupt or terminate our operations, causing our development activities to be curtailed or terminated in these
areas, or our production to decline; limit our ability to pursue new opportunities; affect the recoverability of our assets; or
cause us to incur additional costs or delay the timeline of our projects.



Our future performance depends
on the successful development and deployment of new technologies and the knowledge to apply and improve them.



Technology, knowledge
and innovation are essential to our business, especially for improvements in the production of heavy crude oil, the exploitation
of mature fields and the development of unconventional hydrocarbons. If we do not develop the right technology or do not obtain
the expertise to operate new technology or to improve our processes, do not have access to, or do not deploy the knowledge necessary
to apply and improve such technology effectively, the execution of our Strategic Plan, our profitability and our earnings may
be adversely affected.



We may not be able to achieve
our corporate goals if we face difficulty in finding competent successors to our current management and employees.



Our growth strategy and
the successful achievement of our corporate goals depend on the competence and skills of our management and employees, and our
ability to successfully recruit new employees, in particular technical specialists such as petroleum engineers and scientists,
as well as our ability to retain our current employees. If our managers and employees decide to retire or leave us, it may be difficult
for us to find adequate successors with the required skills, knowledge, leadership and qualifications for the job. In addition,
we may face difficulties in retaining our key managers and employees because of the high level of competition for human resources
with experience and knowledge in the oil and gas industries. Furthermore, our compensation structure may not be able to meet industry
levels and as a result our key employees may leave for jobs offering higher compensation.



Inability to develop human
capacity and capability, both across the organization and in specific operating locations, could jeopardize performance delivery.
Execution of short- and long- and term goals will depend on recruiting and retaining high-quality employees. See “Item 6. Directors,
Senior Management and Employees—Employees.”



-12-







Legislation and regulatory initiatives
relating to hydraulic fracturing and other drilling activities for unconventional oil and gas reserves could increase the cost
of implementing our Strategic Plan and the future costs of doing business or cause delays and adversely affect our operations.



Hydraulic fracturing is
a commonly used process that involves injecting water, sand and small volumes of chemicals into the wellbore to fracture the hydrocarbon-bearing
rock thousands of feet below the surface to facilitate higher flow of hydrocarbons into the wellbore. We expect to begin to
use hydraulic fracturing combined with horizontal drilling in the production of oil and natural gas from certain reservoirs, especially
shale formations. The Government has not issued any permits for the exploration and exploitation of unconventional hydrocarbons.
The Government has promulgated a new technical regulation, Ministry of Mines and Energy Resolution 90341 of 2014, which sets forth
technical requirements and procedures for unconventional reservoirs exploration and exploitation, particularly for the use of hydraulic
fracturing and the construction of wells. As a complement to this technical regulation, the Colombian national environmental
authority is preparing a terms of reference for environmental impact assessment for unconventional reservoirs exploration and exploitation.
Outside Colombia a number of groups have proposed initiatives to, among other things: further regulate hydraulic fracturing practices;
limit water withdrawals and water use; require disclosure of fracturing fluid constituents; restrict which additives may be used;
and implement temporary or permanent bans on hydraulic fracturing. Should Colombia adopt any of these initiatives, or impose stringent
regulatory and permitting requirements related to the practice of hydraulic fracturing, this could significantly increase the
cost of, or cause delays in, the implementation of our Strategic Plan and adversely affect our operations and results of operations.



We may incur losses and spend
time and money defending pending lawsuits and arbitrations.



We are currently a party
to several legal proceedings filed against us. We are also subject to labor-related lawsuits filed by current and former employees
in connection with pension plans and retirement benefits. As of December 31, 2013, we were a party to 2,357 legal proceedings
relating to civil, administrative, environmental, tax, and labor claims filed against us of which273 met the accounting
threshold for an accrual provision. We allocate substantial amounts of money and time to defend against these claims, in which
the claimants often seek substantial sums of money as well as other remedies. See Notes 19 and 31 to our consolidated financial
statements and “Item 8. Financial Information—Legal Proceedings.”



Our operations may not be able
to keep pace with the increasing demand for natural gas or our natural gas supply commitments.



According to Colombian
Commission for Regulation of Energy and Gas (CREG) Resolution 089 of 2013, a supplier of natural gas must possess sufficient economically
viable natural gas before executing a natural gas delivery contract with a customer. In the long term we may not be able to keep
up with increasing local demand for natural gas if demand outpaces the rate of our new natural gas developments and discoveries
or because of the decline of our fields. As a result, we may lose market share, which may negatively impact our financial condition
and results of operations.



Additionally, we are party
to certain national and international gas supply contracts that have firm gas commitments. If we are unable to deliver natural
gas to these clients as a result of cuts in operations, delays in the completion of projects relating to our production facilities
or the acceleration of the decline in our gas production, among other reasons, we may be required to compensate our customers (which
include utilities, power generators and other large customers in the Colombian market and PDVSA in Venezuela) for our failure to
supply natural gas.



During 2012, delays in
the start of new projects, mainly the Planta de Gas Cupiagua and projects to increase the production capacity at the Guajira fields,
resulted in penalties imposed on us by our clients. The main causes of delays in the start of the new projects were: delays in
processing environmental licenses for the natural gas pipeline Cupiagua–Cusiana, landslides caused by adverse weather conditions
and isolated labor strikes in project areas belonging to other oil and gas companies. During 2010, 2011 and 2012, we paid the following
penalties paid in compensation for non-delivery of natural gas: Ps$85.2 billion (approximately US$44.5 million), Ps$2.5 billion
(approximately US$1.3 million) and Ps$9.2 billion (approximately US$5.2 million), respectively. Although we did
not pay any such penalties in 2013, we cannot assure you that in the future we will not be subject to additional monetary fines
which can in turn affect our financial condition and result of operations.



We depend on others for
the construction and availability of natural gas transportation infrastructure for the transport of our gas, which may limit our
ability to develop new or existing fields or lead to the deterioration of related assets and may not allow us to recover the cost
of capital invested in natural gas discoveries.



-13-







We are prohibited by law
from holding more than 25% of the equity of any natural gas transportation company. Therefore, there can be no assurance that the
transportation infrastructure necessary to transport natural gas from the fields to distribution points and our customers will
be built by third parties or that if built there will be sufficient capacity available to us for the exploitation of new natural
gas discoveries or the development of existing fields. The failure to commercially exploit new or existing discoveries may result
in impairment of the related assets and our inability to recover the capital expenditures invested to make these natural gas discoveries.
As a result, we may be required to enter into agreements with natural gas transportation companies on terms that are not favorable
to us.



For example, we have developed
natural gas reserves in the Cusiana and Cupiagua fields, but transportation capacity to deliver gas from these fields is currently
limited.



Our operations could be affected
by conflicts with labor unions.



In the past, we have been
affected by strikes and work stoppages promoted by our own and our industry’s labor unions. These strikes are most prevalent
during collective bargaining negotiations, some of which occurred prior to April 2009 during the negotiations of our current collective
bargaining agreement, which expires on June 30, 2014. That agreement covers three labor unions that exist in the industry: Petroleum
Workers’ Labor Union (USO), ADECO and SINDISPETROL. See “Item 6. Directors, Senior Management and Employees—Employees.”
The negotiation of a new collective bargaining agreement with the labor unions could result in labor disputes, work slowdowns or
stoppages. Although we expect that we will reach an agreement during the “direct arrangement” stage, no assurance can
be given that such agreement will be reached or that the terms of such agreement will be favorable to us. According to Colombian
labor legislation, the expiration of a collective bargaining agreement does not result in the termination of the conditions that
were originally agreed to in the expired collective bargaining agreement. In this case, the collective bargaining agreement will
be extended until a new agreement is signed or an arbitral award is rendered.



During 2013, there were
a number of work stoppages organized and promoted by employees of certain of our contractors and subcontractors, and promoted by
the USO. One stoppage affected our subsidiary Equión, which was caused by workers of the firm Ismocol. Similarly, there
was a stoppage that took place during the collective bargaining process between Reficar and the contractor CB&I. Our subsidiary
Bionergy was also affected by another stoppage caused by workers of the company Colmáquinas and by workers of the contractor
Montajes JF.



Those stoppages did not
have a material adverse effect on our operations. We cannot assure you that we will not experience labor unrest in the future.
If relations with the labor unions deteriorate, which could result in strikes, work stoppages or even sabotage, our results of
operations and financial condition could be adversely affected.



Our activities may be interrupted
or affected by external factors, such as abnormal weather conditions and natural disasters.



We are exposed to several
risks that may partially interrupt our activities. They include fires or explosions, natural disasters, criminal acts and acts
of terror, malfunction of pipelines and emission of toxic substances.



For instance, in 2011
we were affected by weather conditions that intensified the strength of the average rain season in Colombia, causing landslides
due to the abnormal concentration of water in the soil. These abnormal landslides affected transportation of crude oil by trucks,
transportation of crude oil, natural gas and other products by pipelines and the normal operation of our production fields and
Reficar, which experienced floods at its facilities as a result of torrential rains.



On December 23, 2011,
our Salgar-Cartago pipeline ruptured. We believe that this incident occurred as a result of a creep movement as a consequence of
severe weather conditions in the area, causing the surrounding soil to exert strong pressure on the pipeline, causing it to rupture.
The spilled gasoline from the pipeline subsequently came into contact with a heat source which ignited it causing several explosions,
resulting in 33 fatalities, 77 injuries, and damaged and destroyed property. On December 11, 2011, our Caño Limón-Coveñas
oil pipeline ruptured as a result of soil movement caused by the heavy rainy season. While the accident did not result in any fatalities,
it resulted in crude oil spilling into the Iscala creek. See “Item 4. Information on the Company—Transportation
Infrastructure—Incidents at Transportation Facilities.”



-14-







As a result of the occurrence
of any of the above, our activities could be significantly affected or paralyzed. These risks could result in property damage,
loss of revenue, loss of life, pollution and harm to the environment, among others. If any of these occur, we may be exposed to
economic sanctions, damages, fines or penalties in addition to the costs required to repair or remediate the related damage. These
costs, fines and penalties may adversely affect our financial condition and results of operations.



Our operations, which includes
activities in areas classified as indigenous reserves and Afro-Colombian lands are subject to social risks.



We carry out and plan
to carry out exploration and production activities in areas classified by the Government as indigenous reserves (resguardos)
and Afro-Colombian lands (territorios colectivos). We may not be able to undertake exploration or production activities
in these areas until we reach an agreement with the indigenous or Afro-Colombian communities living on these lands. In order to
undertake exploration and production activities we must first comply with the Previous Consultancy process, set forth by Colombian
law. Generally these consultation processes last between four to six months, but may be significantly delayed if we cannot reach
an agreement with the communities. For example, we conduct operations in areas in the Northeastern region, which are inhabited
by the U’wa community. Commencement of operations on two blocks in this region have been delayed, in each case, for 21 years
and 11 years as of December 2013, because that community has refused to participate in the consultation process and the applicable
legislation does not contemplate any alternatives in such a case. The U’wa community still refuses to permit hydrocarbon
exploration or exploitation in their territory. In regions like Sucre and Tolima, the communities are divided into “councils”
(cabildos) that claim to be treated like independent communities. In La Guajira, territorial conflicts or population growth
leads to the creation of new settlements within that jurisdiction that must be considered in the decision-making process. Difficulties
in determining the precise legal boundaries of the Orinoquía region require us to conduct detailed baseline surveys prior
to our activities in the region.



These consultation processes
may be lengthy and require that we devote substantial resources and manpower in order to reach an agreement. No assurance can be
given that we will be able to reach an agreement with the different communities or that the communities will participate in such
processes. We may be exposed to similar delays due to opposition from local communities in other countries where we carry out exploration
activities in indigenous reserves, such as Peru.



Our activities are also
subject to social risks, including protests by communities surrounding our operations. For example, during the construction of
the Bicentenario oil pipeline, construction was suspended as a result of lockouts used by communities in the area of influence
of the oil pipeline to demand greater participation of the Government and social investment, as well as greater participation of
private companies in the development plans of towns in the departments of Arauca and Casanare. While we are committed to operating
in a socially responsible manner, we may face opposition from local communities with respect to our current and future projects
and such opposition could adversely affect our business, results of operations and financial condition.



Our operations are subject to
extensive regulation.



The Colombian hydrocarbons
industry is subject to extensive regulation and supervision by the Government and regulatory agencies in matters including the
award of exploration and production blocks by the ANH, the imposition of specific drilling and exploration obligations, restrictions
on production, price controls, capital expenditures and required divestments. Existing regulation applies to virtually all aspects
of our operations in Colombia and abroad. The commercialization activities of some of our products also face extensive regulation.
Such regulation is subject to change by the applicable regulator affecting our ability to commercialize our products. See “Item 4.
Information on the Company—Overview by Business Segment—Regulatory Framework.”



The terms and conditions
of the agreements with the ANH under which we explore and produce crude oil and natural gas generally reflect negotiations with
the ANH and other governmental authorities and may vary by fields, basins and hydrocarbons discovered.



-15-







We are required, as are
all oil companies undertaking exploratory and production activities in Colombia, to pay a percentage of our production to the Government
as royalties. The oil and gas reserve figures included in this annual report are net of such royalties. The Colombian Congress
has modified the royalty program for crude oil and natural gas production several times in the last 20 years, as it has modified
the regime regulating new contracts entered into with the Government. In the future, the Colombian Congress may once again amend
royalty payment levels for new contracts and such changes could have an adverse effect on our future exploration and production
in Colombia. See “Item 4. Information on the Company—Overview by Business Segment—Regulatory Framework”
for a description of the current royalty scheme.



Our operations in Colombia
are subject to extensive national, state and local environmental regulations. Environmental rules and regulations are applicable
to our exploration, production, refining, transportation, supply and marketing activities, as well as the biofuels we produce.
These regulations establish, among other things, quality standards for hydrocarbon products, air emissions and greenhouse gases,
water discharges and waste disposal, environmental standards for abandoned crude oil wells, soil remediation, water pollution and
the general storage, handling, transportation and treatment of hydrocarbons in Colombia. Currently, all exploratory projects drilling
in areas that do not yet have a license must undergo an environmental impact assessment and must receive an environmental license
from the governmental agency responsible for awarding environmental licenses, the Environmental License National Agency or ANLA.
The Ministry of the Environment routinely inspects our crude oil fields, refineries and other production sites and may decide to
open investigations which may result in fines, restrictions on operations or other sanctions in connection with potential non-compliance
with environmental laws.



We are also subject to
regional environmental regulations issued by the corporaciones autónomas regionalesor CARs,or regional environmental
authorities, which oversee compliance with each region’s environmental regulations. If we fail to comply with any of these
national or regional environmental regulations, we could be subject to administrative and criminal penalties, including warnings,
fines or closure orders of our facilities. See “Item 4. Information on the Company—Overview by Business Segment—Environmental
Matters.”



Environmental regulation
has become more stringent in Colombia in recent years and as a result we have allocated a greater percentage of our expenditures
toward compliance with applicable law, and dedicated a management team in charge of environmental compliance. If environmental
laws continue to impose additional costs on us, and as new laws and regulations relating to climate change become applicable to
us, we may need to reduce our investments on strategic projects in order to allocate funds to environmental compliance. We are
also exposed to delays in obtaining environmental licenses from ANLA, which can lead to cost overruns or to changes in our investment
plans. These additional costs may have a negative impact on the profitability of the projects we intend to undertake or may make
them economically unattractive, in turn having a negative impact on our results of operations and financial condition.



We are subject to foreign
environmental regulations for the exploratory activities conducted by us outside Colombia. Failure to comply with foreign environmental
regulations may result in investigations by foreign regulators, which could lead to fines, warnings or temporary suspensions of
our operations, which could have a negative impact on our financial condition and results of operations.



Under certain of our credit
agreements, we are under an obligation to comply with international environmental standards established by our lenders or by multilateral
institutions. Failure to comply with such environmental standards could result in an event of default under the relevant credit
agreements that we, or our subsidiaries, have entered into, which would affect our financial condition. For instance, the credit
facility executed by Reficar for the financing of its expansion and modernization project includes an obligation to comply with
the U.S.-Exim Environmental Procedures and Guidelines and the Organization for Economic Co-operation and Development (OECD) Common
Approaches on Environment and Officially Supported Export Credits, and a credit agreement executed by Ecopetrol S.A. to finance
purchases of U.S. goods and services requires Ecopetrol S.A. to comply with the U.S.-Exim Environmental Procedures and Guidelines.



In addition, we may be
subject to foreign health and safety and environmental regulations for our exploratory activities conducted outside Colombia. Foreign
health and safety regulations may be more severe than those established under Colombian law and, therefore, we may be required
to make additional investments to comply with those regulations.



-16-







We have made significant investments
in acquisitions and we may not realize the expected value.



We have acquired interests
in several companies in Colombia and abroad. See “Item 4. Information on the Company.” Obtaining the expected
benefits of the acquisitions will depend, in part, on our ability to (1) obtain the expected operational and financial results
from these acquisitions, (2) manage disparate operations and integrate distinct corporate cultures and (3) manage our objectives
as a corporate group. These efforts may not succeed. Our failure to successfully obtain the expected results from our acquisitions
could adversely affect our financial condition and results of operations.



Our subsidiaries Refinería
de Cartagena S.A. (Reficar) and Bioenergy are currently engaged in their own construction projects. If those projects are delayed
or cost more than we projected, our operating results and financial condition may be affected.



Reficar has raised US$3.5 billion
through a limited-recourse project financing in which we have acted as sponsor and have provided both a construction support and
a debt service guarantee. If the construction of the project to upgrade the Cartagena refinery is delayed because of operational
problems, we may be required to provide sufficient financial resources, either by means of capital contributions or by the extension
of a subordinated loan, so that the project can reach completion. Operational problems may include, but are not limited to, labor
productivity or unavailability of construction material in the development of the project, or failure of the upgraded refinery
to reach the expected performance level in terms of the quality of products and/or volumes produced. If we are required to provide
additional capital or guarantees, other strategic projects may be delayed or cancelled, thereby affecting our operating results
and financial condition. Additionally, delays in the implementation of the project may result in larger capital expenditures, which
could increase the overall cost of the project and impact our financial position.



During 2013 and 2014 we
were called upon to provide Reficar with financial support beyond the US$3.5 billion Reficar raised through limited-recourse project
financing. First, in 2013, Reficar requested approximately US$1 billion under the Construction Support Agreement, which was contributed
as follows: (i) US$750 million by a shared capitalization process carried out by its main shareholders Ecopetrol S.A. and Andean
Chemicals Ltd and (ii) US$252 million from a subordinated loan from Ecopetrol Capital AG. Any increase in the project’s capital
expenditures is expected to be funded under the Construction Support Agreement between Reficar and us.



In 2014, Reficar requested
US$1.35 billion under the Construction Support Agreement. This amount will be contributed as follows: (i) a capitalization process
carried out by its main shareholders Ecopetrol S.A. and Andean Chemicals Ltd and (ii) a subordinated loan from Ecopetrol Capital
AG. See “Item 4. Information on the Company—Overview by Business Segment—Refining and Petrochemicals—Reficar.”





Bioenergy is constructing an ethanol plant
with an installed capacity of 480,000 liters per day. Mechanical completion of the project was delayed, which caused the delay
of other milestones of the project, including the start of its commercial operation. Currently, the project is expected to be in
commercial operation in mid-2016 mainly due to poor performance by the EPC contractor, which has also led to social and labor strikes.
We are currently reviewing the budgeted amount of the project and a possible schedule to achieve its completion. Thus, we may be
required to provide additional funding in excess of the original budgeted amounts. Any increase in the project’s capital
and preoperative expenditures are expected to be funded by capitalization. This operation is being analyzed by Bioenergy’s
shareholders in order to determine whether the minority stakeholders will participate in funding or have their stakes in Bioenergy
diluted.







Other investment projects
that are part of our Strategic Plan could face similar planning and implementation problems, which could impact the competitiveness
of our programs and projects, adversely affecting our results of operation and financial condition.



-17-







Our results may be affected by
the performance of our business partners, as many of our operations are executed under association and joint venture agreements
with business partners.



Many of our operations
are executed through associations, joint ventures and other agreements with our business partners. Consequently, we depend on the
performance of our business partners. The poor performance of any of our business partners, especially in those projects in which
we do not act as operators, could negatively impact oil and natural gas production, which in turn could have a negative impact
on our results of operations and financial condition. In addition, we are exposed to the risk of not finding business partners
with the appropriate skills and performance that we require for our projects.



Our insurance policies do not
cover all liabilities and may not be available for all risks.



Our insurance policies
do not cover all liabilities, and insurance may not be available for all risks. There can be no assurance that incidents will not
occur in the future, that insurance will adequately cover the entire scope or extent of our losses or that we will not be found
liable in connection with claims arising from these and other events, which could adversely affect our financial condition and
results of operations.



A failure in our information technology
systems or cyber security attacks may adversely affect our financial results.



We depend on the reliability
and security of our information technology systems to conduct certain exploration, development and production activities, process
and record financial and operating data, communicate with our employees and business partners, and for many other activities related
to our business. Our information technology systems may fail or have other significant shortcomings due to operational system flaws
or employee misuse, tampering or manipulation. In addition, we may become the target of cyber-attacks or information security breaches
that could result in the unauthorized release, gathering, monitoring, misuse, loss or destruction of proprietary and other information.
Any of these occurrences could disrupt our business, result in potential liability or reputational damage or otherwise have an
adverse effect on our financial results. We have experienced a number of cyber attacks, and although we have not experienced any
material losses relating to failure of our information technology systems or cyber incidents, there can be no assurance that we
will not suffer such losses in the future.



We are exposed to behaviors incompatible
with our ethics and compliance standards.



Given the large
number of contracts that we are party to in Colombia and abroad with local and foreign suppliers, the geographic distribution
of our operations and the great variety of actors that we interact within the course of business, we are subject to the risk
that our employees, contractors, or any person having business relations with us may misappropriate our assets, manipulate
our assets or information or engage in money laundering or the financing of terrorism, for such person’s personal or
business advantage. Our systems for identifying and monitoring these risks may not be effective to fully mitigate them in all
situations. Such acts may result in material financial losses or reputational harm to the Company.



Unavailability of electric power
may affect or limit the continuity of our operations or growth.



Ecopetrol ́s energy
demand is expected to increase significantly in 2015 to 1,422 MW of which 88.33% would be supplied through self-generation, and
the remaining 11.67% by unregulated purchases of electrical energy in the open market. Given the growth in production and the start
of a new transport and refining system, it is possible that during the next few years there will be insufficient electrical energy
for our operations. This is because of the unavailability of market power given the delay of several energy transmission and generation
infrastructure projects, the increase in the share of consumption by non-regulated users, and because of high dependency on the
execution of self-generation and transmission that are exposed to a number of risks, including high volatility in national energy
conditions (such as hydrology, availability of natural gas), licensing restrictions and attacks on infrastructure, among others.



-18-







Risks relating to Colombia’s political
and regional environment



Colombia has experienced internal
security issues that have had or could have a negative effect on the Colombian economy and on us.



Colombia has experienced
internal security issues, primarily due to the activities of guerrillas, paramilitary groups, drug cartels and criminal bands known
as Bacrim. From time to time, guerrillas target crude oil and multi-purpose pipelines, including the Oleoducto Transandino,
Caño Limón-Coveñas and Ocensa pipelines, and other related infrastructure disrupting our activities and those
of our business partners. During 2013, the attacks against our pipeline infrastructure increased by 49% in relation to 2012 (151
attacks in 2012 compared with 225 attacks in 2013). This situation especially affected the infrastructure located in Putumayo,
Nariño, Arauca and Norte de Santander and the following pipelines: San Miguel Orito, Transandino and Caño Limón
Coveñas. On several occasions, guerilla attacks have resulted in unscheduled shutdowns of transportation systems in order
to repair or replace sections of pipelines or production facilities that have been damaged and deferral of production in certain
fields, and have also caused us to undertake environmental remediation. The direct cost of repairs to our pipeline infrastructure
due to terrorist attacks in 2013 was approximately Ps$60.2 billion (US$32 million). Guerrilla groups and other illegal armed groups
also attacked natural gas transportation infrastructure that have affected our natural gas production in the past. These activities,
their possible escalation and the effects associated with them have had, and may have in the future, a negative impact on the Colombian
economy or on us, which may affect our customers, employees, assets or the environment, with resulting containment, clean-up and
repair expenses. In the context of this complex security situation, allegations and court judgments have been levied against members
of the Colombian Congress and on government officials for possible ties with illegal groups. This situation may have a negative
impact on the credibility of the Colombian government, which could in turn have a negative impact on the Colombian economy or on
us in the future.



The Colombian government
engaged in 2012 in negotiations with the Revolutionary Armed Forces of Colombia, or FARC, the largest guerrilla group in Colombia,
with a view to end the armed conflict. This is the latest attempt in a series of unsuccessful negotiations between the Colombian
government and the FARC. While the process is ongoing, military operations and hostilities continue. If the negotiations fail,
the intensity of the internal armed conflict is likely to continue, which could negatively impact our future operating results.
We cannot assure you that, if the negotiations turn out to be successful, certain guerrilla groups may not continue their illegal
and terrorist activities which could affect our operations.



There have been certain events
in Colombia and abroad, which have resulted in political tensions between Colombia and some of its neighboring countries.



Diplomatic relations between
Colombia and some of its neighboring countries, in particular Ecuador and Venezuela, have been tense in the past. These political
tensions were heightened by the Colombian Government’s allegations that neighboring countries are supporting the guerilla
groups, as well as by claims made by Venezuela stating that the Colombian army has entered its territory while in pursuit of FARC
members. The Colombian army and air force continue to combat FARC members in Colombian territory, including Colombia’s borders
with neighboring countries. Although relations with these countries have stabilized recently, there can be no assurance that similar
allegations could not be made again that may result in new and heightened tensions with Colombia’s neighbors, which have
had in the past, and could have in the future, a negative impact on Colombia’s economy and general security situation.



Companies operating in Colombia,
including us, are subject to the prevailing economic conditions and the investment climate in Colombia, which may be less stable
than the prevailing economic conditions and investment climate in developed countries.



Market prices of securities
issued by Colombian companies, including us, are subject to the prevailing economic conditions in Colombia. A large portion of
our assets and operations are located in Colombia and most of our sales are currently derived from our crude oil and natural gas
production and the production of our refineries located in Colombia. Accordingly, our financial condition and results of operations
depend to a significant extent on macroeconomic and political conditions prevailing from time to time in Colombia and on the rates
of exchange between the Peso and the U.S. dollar.



-19-







The investment and security
climate in Colombia continues to be tied to the results and performance of President Juan Manuel Santos’s economic, security
and social policies and the perception of such policies by foreign investors. Since his election in 2010, President Juan Manuel
Santos has continued policies to increase foreign investment in Colombia as well as to improve relations with neighboring countries,
which have resulted in economic stability for Colombia. In 2013, Colombia’s annual gross domestic product increased by 4.3%.
Mining activities accounted for 7.7% of Colombian GDP and grew 4.9% year-on-year. Oil and gas production accounted for 72% of mining
activities. In 2012, Colombia’s annual gross domestic product increased by 4% due principally to an increase of 5.9% in crude
oil and mining production.



If the perception of improved
overall security in Colombia deteriorates or if the investment climate worsens, the Colombian economy may face lower growth rates
than the ones posted recently, which could negatively affect our financial condition and results of operations. Furthermore, the
market price of our shares and American Depositary Shares, or ADSs, may be adversely affected by changes in governmental policies,
particularly those affecting economic growth, exchange rates, interest rates, inflation and taxes. The Government has changed monetary,
fiscal, taxation, labor and other policies over time and has thus influenced the performance of the Colombian economy. We have
no control over the extent and timing of government intervention and policies.



Colombian political and economic
conditions have a direct impact on our business and may have a material adverse effect on us.



Colombia’s economic
policies may have direct impact on our company as well as market conditions and the prices of securities. Our financial condition
and results of operations may be adversely affected by the following factors and the Government’s response: devaluations
and other exchange rate movements; inflation; exchange control policies; price instability; interest rates; liquidity of domestic
capital and lending markets; tax policy; regulatory policy for the oil and gas industry, including pricing policy; and other political,
diplomatic, social and economic developments in or affecting Colombia.



Uncertainty over whether
the Government will implement changes in policy or regulations that may affect any of the factors mentioned above or other factors
in the future may lead to economic uncertainty in Colombia and increase the volatility of the Colombian securities market and securities
issued abroad by Colombian companies, which may have a material adverse effect on our results of operations and financial condition.



Developments and the perception
of risk in other countries, especially emerging market countries, may adversely affect the market price of Colombian securities,
including our ADSs.



Securities issued by Colombian
companies may be affected by economic and market conditions in other countries, including other Latin American and emerging market
countries. Although economic conditions in Latin American countries and in other emerging market countries may differ significantly
from economic conditions in Colombia, investors’ reactions to developments in these other countries may have an adverse effect
on the market value of securities of Colombian issuers.



Due to past financial
crises in several emerging market countries (such as the Asian financial crisis of 1997, the Russian financial crisis of 1998 and
the Argentine financial crisis of 2001), the world financial crisis of 2008 and the recent sovereign debt crises in certain European
countries, investors may view investments in emerging markets with heightened caution. In the past, as a result of crises in other
countries, flows of investments into Colombia have been reduced. Crises in other countries, especially in emerging market countries,
may hamper investor enthusiasm for securities of Colombian issuers. If Latin America experiences a new slow-down or if the price
for securities of Latin American issuers falls, the price for our ADSs could follow this trend and could be adversely affected.



Our controlling shareholder’s
interests may be different from those of our minority shareholders.



Colombian Law 1118 of
2006 requires the Nation to maintain the majority of our outstanding capital stock. The Nation currently holds 88.49% of our
outstanding capital stock, making it our controlling shareholder. The Nation as our controlling shareholder has majority voting
rights at the shareholders’ meeting to elect the members of our Board of Directors. The Nation may propose and approve
decisions that are in its own interest and in furtherance of its own economic and political interests that do not necessarily benefit
minority shareholders.



-20-







Our controlling shareholder
may approve dividends at the ordinary general shareholders’ meeting, notwithstanding the interest of minority shareholders,
in an amount that results in us having to reduce our capital expenditures, thereby negatively affecting our prospects, results
of operations and financial condition. See “Item 8. Financial Information—Dividends.”



Additionally, given our
controlling shareholder’s interests, it may undertake projects, approve decisions or make announcements about its intentions
related to its holding of our capital stock which may not be in our best interest or in the best interest of our minority shareholders,
including holders of our ADSs, and could impact the price of our shares or ADSs.



The Government may delay the payment
of gasoline and diesel fuel price differentials and proposed legislation regarding the differentials, if enacted, could have a
negative impact on our financial condition, results of operations and liquidity.



The Government regulates
domestic prices of liquid fuels according to a formula based on international market prices. When domestic prices of liquid fuels
are lower than international parity prices, the Government is responsible for paying importers or refiners the difference, which
is called the fuel price differential, pursuant to Law 1151 of 2007, through the Fuel Stabilization Fund (Fondo de Estabilización
de Precios de los Combustibles) or FEPC. The fuel price differential is calculated on a monthly basis and reported to the Ministry
of Mines and Energy on a quarterly basis. In recent periods, however, payment of the differentials has been significantly delayed.
See “Item 5. Operating and Financial Review and Prospects—Gasoline and Diesel Price Differentials.”



Similar to the approach
followed by other countries, the FEPC has been funded with payments by producers when international prices are lower than the internal
price and, as described above, depleted when international prices are higher, in order to mitigate the effects of international
gasoline and diesel fuel price volatility on the domestic market. Domestic prices for end users of gasoline and diesel fuel may
vary a maximum of 3% per month regardless of the size of the variation of international prices. The difference between the international
and the domestic price is paid by the fund to the refiner or importer. In September 2013, a ruling of the Constitutional Court
of Colombia eliminated the ability of the Colombian Government to fund the FEPC with payments from producers. Currently, funds
for the FEPC must originate from the general revenues of the Colombian Government. Congress is discussing further changes to the
fuel price differential methodology and funding methods for the FEPC.



Delays in fuel price differential
payments make it difficult to determine when we will collect any such payments. Any material delay in the payment of these fuel
price differentials by the Government or significant changes to laws imposing additional responsibilities on us with respect to
the FEPC, or altering the calculation of fuel price differentials or the formulas for establishing the price of domestic liquid
fuels, could have a negative impact on our financial condition, results of operations and liquidity.



New or higher taxes resulting
from changes in tax regulations or the interpretation thereof in Colombia could adversely affect our results of operations and
financial condition.



New tax laws and regulations,
and uncertainties in the interpretation with respect to existing and future tax policies pose risks to us. In recent years, the
Colombian Congress and tax authorities have imposed additional taxes and enacted modifications to taxes related to financial transactions,
income, value added tax, or VAT, and taxes on net worth. Changes in tax-related laws and regulations, and interpretations thereof,
can affect tax burdens by increasing tax rates and fees, creating new taxes, limiting tax deductions, and eliminating tax-based
incentives and non-taxed income. In addition, tax authorities and tax courts may interpret tax regulations differently than we
do, which could result in tax litigation and associated costs and penalties. For Colombian income tax purposes and, as a general
rule, dividends that are distributed from profits taxed at the corporate level are not taxed or subject to withholding tax at the
shareholder level. Tax treaty rules might also apply on dividend distributions when a shareholder is a resident in a country that
has executed a tax treaty with Colombia. However, this tax treatment may change in the future, and any change could have an adverse
effect on our results of operations and financial condition.



-21-







Risks relating to our ADSs



Holders of our ADSs may encounter
difficulties in protecting their interests.



Holders of our ADSs do
not have the same voting rights as holders of our shares. As set forth in the Deposit Agreement, ADSs may instruct our current
depositary, JPMorgan Chase Bank, N.A., to vote on shareholder matters prior to a shareholders’ meeting. Colombia law does
not, however, require Ecopetrol to request proxies from existing shareholders. Thus, shareholders may not become aware of some
matters in time to instruct the depositary to vote their shares.



The Deposit Agreement
provides ADSs with the right to instruct the depositary to vote common shares separately. The viability of this contractual provision
is unclear. This is because regulatory agencies have advanced inconsistent positions regarding whether a depository must vote common
shares as a single block or may vote them separately. Going forward, the Colombian regulatory authorities may change their interpretation
as to how the voting rights should be exercised by ADS holders, and such possible interpretation could adversely affect the value
of the common shares and ADSs.



Our ADSs holders may be subject
to restrictions on foreign investment in Colombia.



Colombia’s International
Investment Statute regulates the manner in which non-Colombian residents can invest in Colombia and participate in the Colombian
securities market. Among other requirements, Colombian law requires foreign investors to register certain foreign exchange transactions
with the Colombian Central Bank and outlines the necessary procedures to authorize certain types of foreign investments. Colombian
law requires that certain foreign exchange transactions, including international investment in foreign currency between Colombian
residents and non-Colombian residents, must be made through authorized foreign exchange market participants. Any income or expenses
under our American Depositary Receipt, or ADR, program must be made through the foreign exchange market.



Investors acquiring our
ADRs are not required to register with the Colombian Central Bank, as they will benefit from the registration to be obtained by
the custodian for our common shares underlying the ADRs in Colombia. If investors in ADRs choose to surrender their ADRs and withdraw
common shares, they must register their investment in the common shares as a portfolio investment through their local representative,
which may be a brokerage firm, trust company or investment management companies supervised by the Superintendency of Finance. Investors
will only be allowed to transfer dividends abroad after their foreign investment registration procedure with the Colombian Central
Bank has been completed. Investors withdrawing common shares could incur expenses and/or suffer delays in the application process.
The failure of a non-resident investor to report or register foreign exchange transactions with the Colombian Central Bank relating
to investments in Colombia on a timely basis may prevent the investor from remitting dividends, or initiate an investigation that
may result in a fine. In the future, the Government, the Colombian Congress or the Colombian Central Bank may amend Colombia’s
International Investment Statute or the foreign investment rules, which could result in more restrictive rules and could negatively
affect trading of our ADSs.



While Colombia currently
has a floating exchange rate system, it is subject to change. If a more restrictive system is implemented, the depositary may experience
difficulties converting Peso amounts into U.S. dollars to remit dividend payments. See “Item 10. Additional Information—Exchange
Controls.”



Holders of our ADSs may not be
able to effect service of process on us, our directors or executive officers within the United States, which may limit your recovery
in any foreign judgment you obtain against us.



We are a mixed economy
company organized under the laws of Colombia. In addition, most of our Directors and executive officers reside outside the United
States. All or a substantial portion of our assets and the assets of these persons are located outside of the United States. As
a result, it may not be possible for you to effect service of process within the United States upon us or these persons or to enforce
judgments against us or them in U.S. courts obtained in such courts predicated upon the civil liability provisions of the U.S.
federal securities laws. Colombian courts determine whether to enforce a U.S. judgment predicated on the U.S. securities laws through
a procedural system known as exequatur. For a description of these limitations, see “Enforcement of Civil Liabilities.”



-22-







The protections afforded to minority
shareholders in Colombia are different from those in the United States, and may be difficult to enforce.



Under Colombian law, the
protections afforded to minority shareholders are different from those in the United States. In particular, the legal framework
with respect to shareholder disputes is substantially different under Colombian law than U.S. law and there are different procedural
requirements for commencing shareholder lawsuits, such as shareholder derivative suits. As a result, it may be more difficult for
our minority shareholders to enforce their rights against us or our Directors or controlling shareholder than it would be for shareholders
of a U.S. company.



ADRs do not have the same tax
benefits as other equity investments in Colombia.



Although ADRs represent
Ecopetrol’s common shares, for Colombian tax purposes, ADRs are securities different from their underlying assets. Therefore,
ADR holders are not entitled to the tax benefits—e.g., those relating to dividends and profits from the sale of Colombian
common shares—granted to holders of the common shares. Such tax benefits are, among others, those relating to dividends and
profits derived from sale of Colombian common shares. For further information see “Item 10. Additional Information—Taxation—Colombian
Tax Considerations.”



Judgments of Colombian courts
with respect to our ADSs will be payable only in Pesos.



If proceedings are brought
in the courts of Colombia seeking to enforce the rights of ADS holders of common shares, we will be required to discharge our obligation
amounts in Pesos. Colombian law provides that an obligation in Colombia to pay amounts denominated in foreign currency may
only be satisfied in Colombian currency at the Representative Market Exchange Rate of the date the judgment is obtained, and such
amounts are then adjusted to reflect exchange rate variations through the effective payment date.



The relative volatility and illiquidity
of the Colombian securities markets may substantially limit our investors’ ability to sell our ADSs at the price and time
they desire.



Investing in securities
that are traded in emerging markets, such as Colombia, often involves greater risk when compared with other world markets, and
these investments are generally considered to be more speculative in nature.



The Colombian securities
market is substantially smaller, less liquid, more concentrated and can be more volatile than other securities markets. The Colombian
Stock Exchange (Bolsa de Valores de Colombia), or BVC, had a market capitalization of approximately Ps$413,916 billion
(US$214.8 billion using the closing rate for 2013) as of December 31, 2013, a 14.4% decrease when compared with the amount
at the end of 2012, a daily average trading volume of approximately Ps$167,538 million (US$89.6 million, using the average
exchange rate for 2013), an 11% decrease when compared with the volume in 2012. By comparison, the New York Stock Exchange, or
NYSE, had a market capitalization of US$17.94 trillion as of December 31, 2013, and a daily trading volume of approximately
US$37.53 billion in 2013.



As of December 31,
2013, our shares represented the highest market capitalization of the BVC with 37% of the total. In addition, they had the highest
trading volume in the BVC, averaging Ps$21,103 million traded per day. On November 1, 2013, the Índice General de
la Bolsa de Valores de Colombia, or IGBC, and the COL20 index were replaced by a new set of indexes: COLCAP, COLEQTY, COLSC
and COLIR, all weighted by the adjusted market capitalization of the issuers. COLCAP reflects the price volatility of the 20 most-liquid
stocks; COLEQTY is composed by 40 stocks whose liquidity is measured as follows: volume (80%), frequency (15%) and rotation (5%);
COLSC comprises the 15 stocks with the lower market capitalization in the COLEQTY; and COLIR includes the issuers that were recognized
for their best practices in Investor Relations for the Colombian Stock Exchange and that are also part of the COLCAP.



-23-







For the period between
February 1st and April 30th of 2014 our shares represent 19.736% of the COLCAP, 10.648% of the COLEQTY, and 10.640% of the COLIR.
Ecopetrol does not participate in the COLSC.



Given the current ownership
structure of our shares, it may be difficult for you to purchase large quantities of shares from a single shareholder. We cannot
assure you that a liquid trading market for our ADSs will develop or, if developed, that it will be maintained. Without a liquid
trading market, the ability of investors in our ADSs to sell them at the desired price and time could be substantially limited.



We are not required to disclose
as much information to investors as a U.S. issuer is required to disclose.



We are subject to the
reporting requirements of the Superintendency of Finance and the BVC. The corporate disclosure requirements that apply to us may
not be equivalent to the disclosure requirements that apply to a U.S. issuer and, as a result, you may receive less interim information
about us than you would receive from a U.S. issuer.



| | ITEM 4. | Information on the Company
| | ------- | --------------------------



The Company



We are a vertically integrated
oil company with presence in Colombia, Peru, Brazil and the U.S. Gulf Coast. We divide our operations into three business segments:
exploration and production; transportation and logistics; and refining and petrochemicals. We are the largest corporation in Colombia
as measured by revenues, profits, assets, shareholders’ equity, sales, net income and net worth, and we play a key role in
the local hydrocarbon market. We do not directly perform commercial natural gas transportation activities.



Corporate History



Ecopetrol is a mixed economy
company, incorporated on August 25, 1951, and existing under the laws of Colombia. The term of our duration is unlimited. Our legal
name is Ecopetrol S.A. Our principal executive offices are located at Carrera 13 No. 36-24 Bogota, Colombia and our telephone number
is +571 234 4000.



In 1951, we were incorporated
as the Empresa Colombiana de Petróleos as a result of the reversion of the De Mares concession to the Government by the
Tropical Oil Company. We began our operations as a governmental industrial and commercial company, responsible for administering
Colombia’s hydrocarbon resources. In the same year, we began operating the crude oil fields at La Cira-Infantas and the pipeline
that connected that field with the Barrancabermeja refinery and the port of Cartagena. Three years later, the first national seismic
study was performed under the De Mares concession, which led to the discovery of the Llanito crude oil field in 1960.



In 1961, we assumed the
direct operation of the Barrancabermeja refinery and continued its transformation into an industrial complex. The Government contracted
with International Petroleum Colombia Limited, Intercol, to begin the construction of a new facility in Mamonal, Cartagena, where
the pipeline terminal of the Andean National Corporation was already located and which also included a loading port. In December
1957, the Cartagena refinery began operations, and in 1974 it was acquired by us.



In 1970, we adopted our
first bylaws that transformed us into a governmental industrial and commercial company linked to the Ministry of Mines and Energy.
In order to make us more competitive, Decree Law 1760 of 2003 transformed us from an industrial and commercial company into a state-owned
corporation through shares linked to the Ministry of Mines and Energy, renaming us Ecopetrol S.A. in the process.



Since 2003, the Company
has been evolving from a wholly state-owned entity to a mixed economy company with private capital, carried out through the initial
public offering in November 2007. This process has resulted in a substantial change in the legal framework to which we are subject
and in the nature of our relationship with the Nation.



-24-







The Nation currently controls
88.49% of our voting capital stock. Since September 18, 2008, our ADRs have been trading on the NYSE under the symbol “EC.”
On December 4, 2009, our ADRs began trading on the Lima Stock Exchange under the symbol “EC.” On March 16, 2011 our
ADRs were delisted from the Lima Stock Exchange. In addition, on August 13, 2010, our ADRs began trading on the Toronto Stock Exchange
under the symbol “ECP.” Each ADR represents 20 common shares of the Company.



The following table sets
forth our material acquisitions within the past five years and the effective date as of which each has been reflected in our operating
results.



|Company                                 |  | Date |               |  | Participation acquired in transaction |  |          | Sector |  | Price (US$)(1)             | 
|--------------------------------------- |  | ---- | ------------- |  | ------------------------------------- |  | -------- | ------ |  | -------------------------- | 
|                                        |  |      |               |  |                                       |  |          |        |  |                            | 
|Offshore International Group Inc. (OIG) |  |      | February 2009 |  |                                       |  | 50%(2)   |        |  | Exploration and Production | 
|Oleoducto Central S.A. (Ocensa)         |  |      | March 2009    |  |                                       |  | 24.7%(3) |        |  | Transportation             | 
|Hocol Petroleum Limited                 |  |      | March 2009    |  |                                       |  | 100%(4)  |        |  | Exploration and Production | 
|Refinería de Cartagena S.A. (Reficar)   |  |      | May 2009      |  |                                       |  | 51%(5)   |        |  | Refining                   | 
|Equión Energía                          |  |      | January 2011  |  |                                       |  | 51%(6)   |        |  | Exploration and Production | 










| | (1) | Includes amounts of adjustment on transaction prices.
| | --- | -----------------------------------------------------



| | (2) | U.S. parent of Savía Perú (formerly Petrotech Peruana S.A.).
| | --- | ------------------------------------------------------------



| | (3) | As a result of this transaction, our ownership of Ocensa increased to 60%.
| | --- | --------------------------------------------------------------------------



| | (4) | We acquired 100% of Maurel et Prom’s interest in Hocol Petroleum Limited, whose most important
assets are Hocol S.A. and Homcol Cayman Inc. As a result of the acquisition, our ownership in Oleoducto de Colombia, increased
from 43.85% to 65.57%.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (5) | As a result of this transaction, we became the sole owner of Reficar.
| | --- | ---------------------------------------------------------------------



| | (6) | As a result of this acquisition, our ownership increased to 72.65% in Ocensa, 73.00% in ODC, and
to 85.12% in Oleoducto del Alto Magdalena or OAM. We also obtained a 10.2% interest in Transgas de Occidente.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In August 2010, we incorporated
Oleoducto Bicentenario de Colombia S.A.S., or Oleoducto Bicentenario, a new company to build and operate a private pipeline that
will run from the Casanare Department to the port of Coveñas. The new pipeline will facilitate oil exports from the Llanos
region. We have, indirectly, a 55.97% ownership of the company and five other shareholders own the remaining 44.03%.



The transactions described
above were funded mainly through cash on hand and cash flow from our operations.



In January 2011, our participation
in Invercolsa S.A., a holding company with investments in natural gas transportation and distribution companies in Colombia, increased
to 43.35% as a result of a final court judgment that awarded us approximately 145 million shares of Invercolsa.



In June 2012, we incorporated
Cenit as our wholly owned subsidiary. In October 2012, we transferred all of our direct interests in Ocensa, ODC, Oleoducto Bicentenario,
ODL and Serviport to Cenit and in April 2013, we transferred our crude oil and products transportation assets to it. This new subsidiary
performs all of our hydrocarbon transport activities, pursuant to transport agreements between Cenit, us and other producers and
distributors in Colombia. We continue operating Cenit’s transportation infrastructure in accordance with an operation and
maintenance agreement. See “Item 4. Information on the Company—Overview by Business Segment—Transportation
and Logistics—Summary—Cenit.”



In 2012, we undertook
a process of reorganization, consisting of the following actions:



-25-







| | · | On May 11, 2012, Ecopetrol Pipelines International (EPI) merged with Ecopetrol Transportation Company
Limited (ETI) and Ecopetrol Transportation Investments Limited, with EPI as the surviving entity.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On July 12, 2012, Ecopetrol S.A. transferred to Ecopetrol Global Energy S.L.U. all of its shares in
Ecopetrol America Inc.
| | - | --------------------------------------------------------------------------------------------------------------------------



| | · | On August 14, 2012, Ecopetrol S.A. transferred to Ecopetrol Global Energy S.L.U. all of its shares
in Ecopetrol del Perú S.A.
| | - | -----------------------------------------------------------------------------------------------------------------------------



| | · | On November 2, 2012, Equión Energía, in which we have a 51% interest, transferred 12.648%
of its shares in Oleoducto Central S.A. (Ocensa) to Ecopetrol Equity Investments (Cayman), a wholly owned subsidiary of Ecopetrol
S.A.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On December 11, 2012, Ecopetrol S.A. transferred to Ecopetrol Global Energy S.L.U. all of its shares
in Ecopetrol Óleo e Gás do Brasil Ltda.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------



| | · | On December 21, 2012, Ecopetrol Pipelines International (EPI) merged with Ecopetrol Oil & Gas
Investments and Ecopetrol Equity Investments.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------



| | · | On December 27, 2012, Hocol S.A., or Hocol, merged with Hocol Limited and Homcol Cayman Inc., or Homcol.
| | - | --------------------------------------------------------------------------------------------------------



| | · | On June 25, 2013, Ecopetrol Pipelines International Limited transferred to Cenit all of its shares
in Oleoducto Central S.A. (Ocensa) and Oleoducto Bicentenario de Colombia S.A.S.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On February 14, 2014, Ecopetrol Pipelines International Limited merged into Cenit.
| | - | ----------------------------------------------------------------------------------



Subsidiaries



We are a mixed economy
company and have a number of directly and indirectly held subsidiaries both in Colombia and abroad. Our subsidiaries are either
directly owned by us or indirectly owned by us through one or more of our other subsidiaries. As of March 31, 2014, there were
nine subsidiaries directly owned by us: one was incorporated in Colombia and the other eight abroad. Eighteen subsidiaries were
indirectly owned by us: eight were incorporated in Colombia and the other ten abroad.



Our wholly-owned subsidiaries
Refinería de Cartagena (Reficar) and Cenit Transporte y Logística de Hidrocarburos S.A.S. (Cenit) are significant
subsidiaries as such term is defined under SEC Regulation S-X. The following table sets forth some of our subsidiaries, their respective
countries of incorporation, our percentage ownership in each (both directly and indirectly through other subsidiaries) and our
voting percentage in each as of March 31, 2014:



|COMPANY                                                 |  | COUNTRY OF INCORPORATION |  | OWNERSHIP AND VOTING % | 
|------------------------------------------------------- |  | ------------------------ |  | ---------------------- | 
|                                                        |  |                          |  |                        | 
|Exploration and Production                              |  |                          |  |                        | 
|Ecopetrol Óleo e Gás do Brasil Ltda.**                  |  | Brazil                   |  | 100.00                 | 
|Ecopetrol del Perú S.A.**                               |  | Peru                     |  | 100.00                 | 
|Ecopetrol America Inc.**                                |  | United States            |  | 100.00                 | 
|Hocol S.A.                                              |  | Cayman Island            |  | 100.00                 | 
|Equión Energía Limited                                  |  | United Kingdom           |  | 51.00                  | 
|Transportation                                          |  |                          |  |                        | 
|Oleoducto de los Llanos Orientales S.A. (ODL)**         |  | Panama                   |  | 65.00                  | 
|Oleoducto de Colombia S.A.**                            |  | Colombia                 |  | 73.00                  | 
|Oleoducto Central S.A.**                                |  | Colombia                 |  | 72.65                  | 
|Oleoducto Bicentenario de Colombia S.A.S. **            |  | Colombia                 |  | 55.97                  | 
|Cenit Transporte y Logística de Hidrocarburos S.A.S.*   |  | Colombia                 |  | 100.00                 | 
|Refining and Petrochemicals                             |  |                          |  |                        | 
|Refinería de Cartagena S.A.*                            |  | Colombia                 |  | 100.00                 | 
|Propilco S.A.*                                          |  | Colombia                 |  | 100.00                 | 
|Compounding and Masterbatching Industry Ltda. (COMAI)** |  | Colombia                 |  | 100.00                 | 
|Biofuels                                                |  |                          |  |                        | 
|Bioenergy S.A.**                                        |  | Colombia                 |  | 91.43                  | 
|Other                                                   |  |                          |  |                        | 
|Black Gold Re Ltd.                                      |  | Bermuda                  |  | 100.00                 | 












| | * | Direct and indirect participation.
| | - | ----------------------------------

| | ** | Solely indirect participation through other subsidiaries or affiliates.
| | -- | -----------------------------------------------------------------------





-26-







See Exhibit 8.1 to this
annual report for a complete list of our subsidiaries, their respective countries of incorporation, our percentage of ownership
in each (both directly and indirectly through our other subsidiaries) and our voting ownership in each.



Our Strategic Plan





Our Strategic Plan is tailored toward Ecopetrol’s
objectives as an integrated corporate group focused on the exploration and development of crude oil, natural gas, refining and
alternative fuels. We intend to be a key market player recognized for our international positioning, innovation and commitment
to sustainable growth.



Our goal is to provide our shareholders
with an average return on capital employed, or ROCE, of 17% and to produce Clean Barrels while staying committed to economic, social
and environmental sustainability. We use the term “Clean Barrels” to refer to the production of crude oil barrels without
accidents or environmental incidents and in harmony with our stakeholders. We continue to pursue operational excellence through
our commitment to ensure our operations are clean and safe, all while optimizing the use of resources and striving to exceed our
clients’ and interest groups’ expectations.



Our Strategic Plan contemplates investments
of US$85.6 billion for the period 2012-2020(US$68.5 billion for the period 2014-2020), to be allocated as follows:



Upstream: Investments in exploration
and production are tentatively US$55.7 billion during 2014-2020, which corresponds to 81% of the total investment plan. Our operations
in Colombia are expected to receive approximately 89% of our total investment in this segment. The additional 11% is expected to
be allocated to projects abroad. Our development plan is mainly concentrated on certain existing fields and areas, including: Castilla,
Chichimene, Apiay, Casabe, La Cira-Infantas, Rubiales, Quifa, Putumayo, Arauca and Catatumbo.



Downstream: In order to modernize
the refining segment, we plan to invest approximately US$6.4 billion during the period 2014-2020, which represents 9% of our
Strategic Plan.



Midstream: By 2020, we expect to
invest US$6.1 billion in pipelines (transportation systems) and logistic facilities in order to mobilize our crude oil and
refined products, mainly through our participation in different projects such as the Bicentenario Pipeline, the expansion of the
Ocensa Pipeline, San Fernando-Monterrey system, and the expansion of the Pozos Colorados – Galán system.



-27-







The breakdown by business segment of our
Strategic Plan investments (annually reviewed and approved by the Board of Directors) is the following:



|SEGMENT    |  | 2012-2020 (in millions of U.S. dollars) |        |  | 2014-2020* (in millions of U.S. dollars) | 
|---------- |  | --------------------------------------- | ------ |  | ---------------------------------------- | 
|           |  |                                         |        |  |                                          | 
|UPSTREAM   |  |                                         | 66,194 |  |                                          | 
|DOWNSTREAM |  |                                         | 10,528 |  |                                          | 
|MIDSTREAM  |  |                                         | 8,400  |  |                                          | 
|OTHER      |  |                                         | 575    |  |                                          | 
|TOTAL      |  |                                         | 85,698 |  |                                          | 



| | * | 2013 Strategic Plan projection. These projections are annually reviewed and approved by the Board
of Directors.
| | - | ---------------------------------------------------------------------------------------------------------------



The investments that our Strategic Plan
envisions are subject to market analysis, conceptual engineering and financial feasibility. We expect to fund the investments of
our Strategic Plan 2012-2020 as follows: 75% from our operational cash generation, 9% from a primary equity offering and 16% from
debt. We believe that we should be able to access local and international debt markets if it is required, although we can make
no assurances that these external sources of financing will be available on terms acceptable to us, if at all. See “Item 5.
Operating and Financial Review and Prospects— Liquidity and Capital Resources.” We are also authorized by Law 1118
of 2006 to issue up to 20% of equity, of which we have so far issued 11.51%, leaving us with the ability to issue an additional
8.49%, which are to be used as an additional source of funding for our Strategic Plan. In our Strategic Plan, we have adopted conservative
assumptions for our projections, avoiding the use of high oil prices. In our last review, we used an average price of US$80 per
barrel for WTI reference and US$90 for Brent reference, all in real terms. We expect that the dividend payout ratio will be close
to 70%. However, in recent years our dividend payout ratio has been close to 80%. For further information see “Item 3.
Risk Factors— Our controlling shareholder’s interests may be different from those of our minority shareholders”
and Item 8 “Financial Information—Dividends.” Our Strategic Plan assumes a profitability close to 17% of ROCE
by 2020.



We maintain strategic
initiatives with respect to each of our different segments, as outlined below.



UPSTREAM



Exploration and Production



Become an international player with the
capacity to incorporate reserves and increase production of crude oil and natural gas in a sustainable way.



We aim to develop a
competitive advantage in heavy crudes, increasing our capacity to add reserves and produce oil and gas in a sustainable way. Around
95% of our current total production is coming from fields in primary recovery phases. In the near term we plan to continue with
infill drilling and water injection projects to further developing enhanced oil recovery projects for certain mature fields.



National Exploration: We expect to
keep acquiring more 3D seismic and drilling more stratigraphic wells, as we continue exploring prospects in the heavy crude oil
belt located in the Llanos, Caguan-Putumayo and Piedemonte regions. We are also performing exploration activities in the Caribbean
offshore, since we believe there is reasonable likelihood of finding oil and gas in that basin. If successful, we expect offshore
the Caribbean to contribute with some production from 2020 onwards.



-28-







International Exploration: We continue
to believe that the Gulf of Mexico and Brazil exhibit a high potential for exploration and production growth. In the Gulf of Mexico,
we focus on the following plays: Miocene subsalt, Paleogene and Jurassic. In Brazil, our focus is the Santos and Campos Basins
and Equatorial margins as well as the pre-salt plays. We also keep on studying other international plays and opportunities on basins
of interest.



Unconventional Hydrocarbons: Since
2012, our Strategic Plan contemplates the potential presented by unconventional reservoirs, as defined by Colombian law, including
shale oil, shale gas and tight reservoirs, among others. Our activities in this regard are subject to further contribute to the
development of the regulatory framework in Colombia. See “Item 4. Information on the Company—Overview by Business Segment—Regulatory
Framework: Regulation of Exploration and Production Activities.”



DOWNSTREAM



Refining and Petrochemicals



The main drivers are to produce cleaner
and more valuable products, improving profitability through synergies and taking advantage of market opportunities by adding greater
value to the refining streams.



Refining: We continue to be the sole
major refiner in Colombia for medium distillates, gasolines and LPG’s. We aim to continue with the modernization plans to
improve value creation and operational standards. To that end, we plan to (1) ensure the completion of the modernization of the
Cartagena refinery currently in progress, (2) continue realizing the plan for the modernization of Barrancabermeja refinery (3)
improving our reputation as a producer of clean fuels to develop further market opportunities within local, regional and international
markets, (4) become the preferred provider of raw material supply to the petrochemical industry, and (5) grow sustainably and profitably
by maximizing the value of heavy crude oils in the supply chain and optimizing their performance to achieve the expected value
of projects.



Petrochemical: Our strategy focuses
on (1) keeping our current position in the market, and (2) improving the competitiveness and reliability of our existing infrastructure.



Our Strategic Plan sets out guidelines for
sales and marketing that emphasizes the importance of consolidating our markets, clients and key products. Our strategy considers
supplying the local market of liquid fuels, as well as exporting crude oil, some refined products and natural gas to end-users,
including refineries and wholesalers. Our market positioning plans are to strengthen our sales of crude oil and refined products
to sustainable and profitable destinations all around the world.



We also participate in the Colombian renewable
energy market in partnership with local investors, with whom we have undertaken the development of industrial facilities to process
sugar cane and palm oil for biofuels.



MIDSTREAM



Transportation and Logistics



We seek to turn the Transportation and Logistics
sector into a facilitator for the development of the entire value chain for the country by providing solutions and ensuring the
efficiency of crude oil flows and their derivatives for use by our company and third parties.



-29-









We aim to accomplish by 2020 the following
main objectives: (1) increase capacity of crude oil transportation in line with the upstream segment’s production goals,
(2) significantly increase capacity of refining products transportation, (3) design and implement profitable projects that can
increase the transportation logistic capacity of the country, (4) perform with operational excellence, and (5) be consumer-oriented.







Cenit



In June 2012, we incorporated
Cenit as a wholly owned subsidiary specializing in logistics and transportation of hydrocarbons within Colombia. With the incorporation
of Cenit, we aim to enhance the strategic and logistical framework of Colombia’s oil industry in response to the increase
in hydrocarbon production and higher sales of crudes and refined products, both within Colombia and on the international markets.
Cenit charges market rate tariffs to all of its customers, including our other segments, and has an open model in which all interested
parties will have the opportunity to access its transportation infrastructure. See “Item 4. Information on the Company—Overview
by Business Segment—Transportation and Logistics—Cenit.”



Overview
By Business Segment



Our reporting segments
changed since the first quarter of 2013 with the elimination of the Marketing and Supply segment. This change was made because
of the marginal role of the segment with respect to our core business. Therefore, the activities of Marketing and Supply presented
in Item 4 in previous years have been reclassified to the Exploration and Production segment and the Refining segment.



Exploration and Production



Summary



Our Exploration and Production
business segment includes exploration, development and production activities in Colombia and abroad. We began local exploration
in 1955 and international exploration in 2006. We conduct exploration and production activities directly and through joint ventures
with third parties. As of December 31, 2013, we were the largest operator and the largest producer of crude oil and natural
gas, and we maintained the largest acreage under exploration in Colombia.



We have exploratory activities
in all of the sedimentary basins that currently have activity in Colombia. The following map shows the basins where we conduct
exploratory activities.



-30-











We have divided Ecopetrol
S.A.’s production activities in Colombia into six administrative regions. The administrative regions, and their respective
2013 production results, prior to deducting royalties, are as follows:



-31-







Northeastern Region
– The Northeastern region comprises two areas: one located in the north of Colombia along the Atlantic coast and the other
located in the Piedemonte Llanero. The Northeastern region covers 549,580 gross proved acres and includes the natural gas fields
located in La Guajira and the crude oil and natural gas fields located in Cusiana-Cupiagua. In 2013, the Northeastern region had
a total production of 43.2 thousand bpd of crude oil, 648.7 million cubic feet per day, or mcfpd, of natural gas and 3.9 thousand
bpd of liquids from the natural gas process.



Mid-Magdalena Valley
Region – The Mid-Magdalena Valley region runs along the Magdalena river valley and covers 997,839 gross proved acres.
It includes the crude oil fields located in the Santander department and part of the Antioquia, Cesar and Boyacá departments
near the Barrancabermeja refinery. In 2013, the Mid-Magdalena Valley region had a total production of 103.6 thousand bpd of crude
oil, 32.4 mcfpd of natural gas and 1.5 thousand bpd of liquids from the natural gas process.



Central Region
– The Central region includes the western part of the Meta department. It covers 588,856 gross proved acres and in 2013 had
a total production of 188.8 thousand bpd of mainly heavy crude oil and 1.5 thousand bpd of liquids from the natural gas process.



Eastern Region
– In 2012 this region was divided into two separate regions: the Central Region and the Eastern Region. The Eastern region
is located in Colombia’s central area and includes the northeastern and eastern part of the Meta department. Operations in
this region are made up mainly of joint venture fields. It covers 779,297 gross proved acres and in 2013 had a total production
of 160.1 thousand bpd of mainly heavy crude oil.



Catatumbo-Orinoquía
Region – The Catatumbo-Orinoquía region is located in the eastern part of Colombia and runs along the border with
Venezuela, covering 1,197,310 gross proved acres. It includes the Caño Limón crude oil field, with a total production
in 2013 of 55.3 thousand bpd of crude oil and 3.2 mcfpd of natural gas.



Southern Region
– The Southern region is located on the southwestern region of Colombia and covers 917,780 gross proved acres. It includes
the Orito, Guando, Tello and San Francisco fields located mainly in the Putumayo, Tolima and Huila departments. In 2013, the Southern
region had a total production of 55.5 thousand bpd of crude oil, 5.8 mcfpd of natural gas.



In addition to the administrative
regions mentioned above, we have established a minor fields area comprising 411,433 gross acres that covers some of our smaller
fields throughout Colombia. The main purpose of this minor fields area is to establish strategies to improve efficiency in the
production of reserves from these fields. The total production of the minor fields area during 2013 was 5.9 thousand bpd of crude
oil and 3.5 mcfpd of natural gas.



The map below indicates
the locations of our operations in Colombia.



-32-











Exploration



Our exploration plan in
Colombia is focused on exploration of: (1) production sites in close proximity to existing ones and (2) currently producing basins
and exploration of frontier areas, including off-shore areas primarily operated by our business partners, which we believe have
the potential for large findings. Our exploration strategy outside of Colombia is focused on locating prospects and establishing
joint ventures with experienced operators. For purposes of this exploration section, “we” refers to Ecopetrol, its
subsidiaries and partnerships in which Ecopetrol has an interest. Unless otherwise stated, all figures are given before deductions
for royalties.



During 2013, we drilled
22 gross wildcats exploratory wells (A3-A2), 19 in Colombia and three overseas. A2 exploratory wells are drilled adjacent
to proven oil deposits in a productive oil field. We drill A3 exploratory wells to find oil deposits in fields where no wells have
yet proven productive. We discovered hydrocarbon presence in eight productive wells, all of them located in Colombia. Twelve wells
were dry, out of which ten were located in Colombia and two in the Gulf Coast. As of December 31, 2013, two wells were under
evaluation, one located in Colombia and the other in Peru.



-33-







Exploration Activities in Colombia



We conduct exploration
activities in Colombia on our own and through joint ventures with regional and global oil and gas companies. In some instances,
we benefit from sole risk contracts pursuant to which we do not take any exploration risk. See “Contractual Arrangements
with the Government of Colombiafor the Exploration and Production
of Crude Oil and Natural Gas in Colombia.”



In 2013, we acquired 6,931
equivalent kilometers of seismic data in Colombia. Ecopetrol S.A. acquired 6,560 equivalent kilometers, both directly and through
business partners, corresponding to 1,397 kilometers of 2D seismic data and 5,163 equivalent kilometers of 3D seismic data. Ecopetrol
S.A. directly acquired 1,159 of those kilometers of seismic data and 5,401 kilometers were acquired by our business partners. In
addition, Hocol acquired 371 equivalent kilometers.



Ecopetrol S.A. drilled
a total of 12 wildcat exploratory wells (A3-A2) in 2013. There was evidence of hydrocarbons in seven wells (Pastinaca-1, Venus-2,
Cusuco-1, Guainiz-1, Qfe-S-1x, Qfn-C-1x, Qfe-D-1x). Four wells were dry and the remaining one was under evaluation. Hocol drilled
seven A3 wells. There was evidence of hydrocarbons in one of the Hocol wells (Canario Sur-1), while the other six were dry.



During 2013, Ecopetrol
S.A. participated in three farmed-in exploration and production contracts with Emerald Energy PLC. These blocks cover a total area
of more than 988 thousand hectares and are located in Caguan (province of Caquetá). Ecopetrol S.A. has a 50% stake in these
contracts.



Exploration Activities Outside of
Colombia



Our international exploration
strategy is focused on participating in bidding rounds to secure blocks available for exploration and entering into joint ventures
with international and regional oil companies. We believe exploring outside Colombia allows us to diversify our risks and improve
the possibilities of increasing our crude oil and natural gas reserves.



In 2013, we drilled three
international gross exploratory wells through our subsidiaries and partners as follows:



| | · | Gulf of Mexico: Ecopetrol America drilled two wells: Madagascar, in which Ecopetrol America
had a 30% working interest, was drilled with Marathon Oil Company (operator) and Murphy Exploration and Production Company USA,
and the Odd Job well, in which Ecopetrol America has a 20% working interest, was drilled with our partners ENI US (operator), Calypso
Exploration LLC and Deep Gulf Energy Offshore LLC. Both wells were declared dry.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Peru: Savía Perú S.A., in which Ecopetrol S.A. has a 50% ownership interest,
drilled one well (Colan 2x) off the Peruvian coast. As of December 31, 2013, this well was under evaluation.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Additionally, in Brazil,
the Jandaia wildcat well, which was under evaluation as of December 31, 2012, was declared dry in 2013.



During the second quarter
of 2013, Ecopetrol America Inc. acquired a 31.5% stake of BP’s participation in the Gunflint discovery in deep waters of
the U.S. Gulf Cost. The Gunflint discovery is operated by Noble Energy Inc., whose participation is 31.14%. The other partners
are Marathon Oil Company (18.23%) and Samson Offshore LLC (19.13%).



In the first half of 2013,
Ecopetrol Óleo e Gás do Brasil Ltda. submitted competitive bids for three offshore exploratory blocks in the eleventh
bidding round carried out in Rio de Janeiro by the Agencia Nacional do Petroleo, Gas Natural e Biocombustiveis (ANP) of Brazil.
Ecopetrol Óleo e Gás do Brasil Ltda. has a 100% interest in the bids for the POT-M-567 and FZA-M-320 blocks and a
50% interest in the bid for the CE-M-715 block together with Chevron Brasil Ventures APS, who will be the operator and owns the
remaining 50%.



-34-







During 2013, we acquired
60,966 kilometers of additional seismic equivalent outside Colombia: 43,940 kilometers in the U.S. Gulf Coast and 17,026 kilometers
in Brazil, an increase of 155% compared with seismic data acquired during 2012.



Exploratory Wells



The following table sets
forth the number of gross and net productive and dry exploratory wells drilled by us and our joint venture partners, and the exploratory
wells drilled by third parties pursuant to sole risk contracts with us for the years ended December 31, 2013, 2012 and 2011.



|                                       |  | For the year ended December 31, |    
|-------------------------------------- |  | ------------------------------- | ---
|                                       |  | 2013                            |    
|COLOMBIA                               |  |                                 |    
|Ecopetrol S.A.                         |  |                                 |    
|Gross Exploratory Wells                |  |                                 |    
|Owned and operated by Ecopetrol        |  |                                 |    
|Productive(1)                          |  |                                 | 4  
|Dry(2)                                 |  |                                 | 2  
|Total                                  |  |                                 | 6  
|Operated by Partner in Joint Venture   |  |                                 |    
|Productive(1)                          |  |                                 | 3  
|Dry(2)                                 |  |                                 | 2  
|Total                                  |  |                                 | 5  
|Operated by Ecopetrol in Joint Venture |  |                                 |    
|Productive(1)                          |  |                                 | -  
|Dry(2)                                 |  |                                 | -  
|Total                                  |  |                                 | -  
|Net Exploratory Wells(5)               |  |                                 |    
|Productive(1)                          |  |                                 | 5.5
|Dry(2)                                 |  |                                 | 3.0
|Total                                  |  |                                 | 8.5
|Sole Risk(6)                           |  |                                 |    
|Productive(1)                          |  |                                 | -  
|Dry(2)                                 |  |                                 | -  
|Total                                  |  |                                 | -  
|Hocol                                  |  |                                 |    
|Gross Exploratory Wells                |  |                                 |    
|Productive (1)                         |  |                                 | 1  
|Dry(2)                                 |  |                                 | 6  
|Total                                  |  |                                 | 7  
|Net Exploratory Wells(5)               |  |                                 |    
|Productive(1)                          |  |                                 | 0.5
|Dry(2)                                 |  |                                 | 5.0
|Total                                  |  |                                 | 5.5
|Equión                                 |  |                                 |    
|Gross Exploratory Wells                |  |                                 |    
|Productive (1)                         |  |                                 | -  
|Dry(2)                                 |  |                                 | -  
|Total                                  |  |                                 | -  
|Net Exploratory Wells(5)               |  |                                 |    
|Productive(1)                          |  |                                 | -  
|Dry(2)                                 |  |                                 | -  
|Total                                  |  |                                 | -  



-35-









|                                     |  | For the year ended December 31, |    
|------------------------------------ |  | ------------------------------- | ---
|                                     |  | 2013                            |    
|INTERNATIONAL                        |  |                                 |    
|Ecopetrol America Inc.               |  |                                 |    
|Gross Exploratory Wells              |  |                                 |    
|Productive(1)                        |  |                                 | -  
|Dry(2)                               |  |                                 | 2  
|Total                                |  |                                 | 2  
|Net Exploratory Wells(5)             |  |                                 |    
|Productive(1)                        |  |                                 | 0  
|Dry(2)                               |  |                                 | 0.5
|Total                                |  |                                 | 0.5
|Ecopetrol Óleo e Gás do Brasil Ltda. |  |                                 |    
|Gross Exploratory Wells              |  |                                 |    
|Productive(1)                        |  |                                 | -  
|Dry(2)                               |  |                                 | -  
|Total                                |  |                                 | -  
|Net Exploratory Wells(5)             |  |                                 |    
|Productive(1)                        |  |                                 | -  
|Dry(2)                               |  |                                 | 0.3
|Total                                |  |                                 | 0.3
|Ecopetrol del Perú                   |  |                                 |    
|Gross Exploratory Wells              |  |                                 |    
|Productive(1)                        |  |                                 | -  
|Dry(2)                               |  |                                 | -  
|Total                                |  |                                 | -  
|Net Exploratory Wells(5)             |  |                                 |    
|Productive(1)                        |  |                                 | -  
|Dry(2)                               |  |                                 | -  
|Total                                |  |                                 | -  
|Savía Perú                           |  |                                 |    
|Gross Exploratory Wells              |  |                                 |    
|Productive(1)                        |  |                                 | -  
|Dry(2)                               |  |                                 | -  
|Total                                |  |                                 | -  
|Net Exploratory Wells(5)             |  |                                 |    
|Productive(1)                        |  |                                 | -  
|Dry(2)                               |  |                                 | 0.5
|Total                                |  |                                 | 0.5










| | (1) | A productive well is an exploratory well that has evidence of hydrocarbons.
| | --- | ---------------------------------------------------------------------------

| | (2) | A dry well or hole is an exploratory well found to be incapable of producing either crude oil or
natural gas in sufficient quantities to justify completion as a crude oil or natural gas well.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (3) | This number does not include the Tiribita-1 well in Colombia and one well in Peru which were under
evaluation as of December 31, 2013.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------

| | (4) | This number does not include the Mapale well, which is included in Equión’s operation.
| | --- | --------------------------------------------------------------------------------------

| | (5) | Net exploratory wells are calculated according to our percentage of ownership in these wells.
| | --- | ---------------------------------------------------------------------------------------------

(6)	  We do not take
any risk in sole risk contracts but we benefit from successful exploratory efforts.

(7)   This number includes
one well that was under evaluation at December 31, 2012 and was declared dry in 2013.



-36-







Production



We plan to increase the
recovery factor in the fields currently held by Ecopetrol S.A., including those that were discovered more than 20 years ago, in
order to increase our average daily production of hydrocarbons and reserves. 87% of the fields of Ecopetrol S.A. are in primary
recovery. Secondary recovery (waterflooding) is or has been implemented in 9% of the fields. Finally, enhanced oil recovery has
been applied in 4% of the fields. We continue to focus our efforts on improving the productivity ratio of several directly operated
fields and other fields currently held through joint ventures with other oil companies.



Our total average consolidated
daily production of hydrocarbons in 2013 totaled 788.2 thousand boepd, of which 651.1 thousand bpd corresponded to crude oil and
137.1 thousand boepd corresponded to natural gas and liquids. This production includes the production contribution from our subsidiaries
and affiliates on the basis of our participation in Hocol and Equión in Colombia and in Ecopetrol America Inc. and Savía
Perú internationally.



During 2012, our consolidated
average daily production of hydrocarbons totaled 754 thousand boepd, out of which 635 thousand bpd corresponded to crude oil
and 119 thousand boepd corresponded to natural gas. In 2011, our consolidated average daily production of hydrocarbons totaled
724 thousand boepd, out of which 616 thousand bpd corresponded to crude oil and 108 thousand boepd corresponded to natural gas.



Ecopetrol S.A.’s
crude oil production during 2013 consisted of approximately 43% light and medium crudes (above 15oAmerican Petroleum
Institute, or API, gravity) and 57% of heavy crudes, with a gravity equal or lower than API gravity 15°. In 2012, approximately
49% of the crude oil production corresponded to light and medium crudes while the remaining 51% to heavy crudes. During 2011, production
distribution was approximately 51% of light and medium crudes and 49% of heavy crudes.



As of December 31,
2013, we were the largest participant in the Colombian hydrocarbons industry, with approximately 63.9% of crude oil production
and approximately 61.8% of natural gas and liquids production.



We undertake development
drilling in producing regions, drilling 170 gross development wells operated by us in Colombia in 2013, 19% less than in 2012 and
41% less than in 2011. Of the total gross development wells drilled by Ecopetrol S.A. and through joint ventures in 2013, 11 wells
were dry in the Eastern Region, four in the Catatumbo Orinoquía Region, four in the Southern Region, one in the Northeastern
Region and one was dry in the minor fields. In 2012, Ecopetrol S.A. had 21 dry development wells and in 2011 we had seven.



Relevant Operational Activities



The following table sets
forth the number of gross and net productive and dry development wells drilled exclusively by us and in joint ventures for the
years ended December 31, 2013, 2012 and 2011.





-37-









|                                                 |  | For the year ended December 31, |      
|------------------------------------------------ |  | ------------------------------- | -----
|                                                 |  | 2013                            |      
|COLOMBIA                                         |  |                                 |      
|Ecopetrol S.A.                                   |  |                                 |      
|Northeastern region:                             |  |                                 |      
|Gross wells owned and operated by Ecopetrol      |  |                                 | 1    
|Gross wells in joint ventures                    |  |                                 | 3    
|Net wells(1)                                     |  |                                 | 3    
|Mid-Magdalena Valley region:                     |  |                                 |      
|Gross wells owned and operated by Ecopetrol      |  |                                 | 67   
|Gross wells in joint ventures                    |  |                                 | 255  
|Net wells(1)                                     |  |                                 | 173  
|Central region:(2)                               |  |                                 |      
|Gross wells owned and operated by Ecopetrol      |  |                                 | 76   
|Gross wells in joint ventures                    |  |                                 | -    
|Net wells(1)                                     |  |                                 | 76   
|Eastern region:(3)                               |  |                                 |      
|Gross wells owned and operated by Ecopetrol      |  |                                 | -    
|Gross wells in joint ventures                    |  |                                 | 287  
|Net wells(1)                                     |  |                                 | 120  
|Catatumbo-Orinoquía region:                      |  |                                 |      
|Gross wells owned and operated by Ecopetrol      |  |                                 | -    
|Gross wells in joint ventures                    |  |                                 | 48   
|Net wells(1)                                     |  |                                 | 24   
|Southern region:                                 |  |                                 |      
|Gross wells owned and operated by Ecopetrol      |  |                                 | 2    
|Gross wells in joint ventures                    |  |                                 | 24   
|Net wells(1)                                     |  |                                 | 3    
|Minor fields:                                    |  |                                 |      
|Gross wells owned and operated by Ecopetrol      |  |                                 | -    
|Gross wells in joint ventures                    |  |                                 | 11   
|Net wells(1)                                     |  |                                 | 5    
|Hocol                                            |  |                                 |      
|Gross wells owned and operated by Hocol          |  |                                 | 18   
|Gross wells in joint ventures                    |  |                                 | 4    
|Net wells(1)                                     |  |                                 | 18   
|Equión                                           |  |                                 |      
|Gross wells owned and operated by Equión         |  |                                 | 6    
|Gross wells in joint ventures                    |  |                                 | -    
|Net wells(1)                                     |  |                                 | 2    
|Total gross wells owned and operated in Colombia |  |                                 | 170  
|Total gross wells in joint ventures in Colombia  |  |                                 | 632  
|Total net wells (Colombia)                       |  |                                 | 424.5
|INTERNATIONAL                                    |  |                                 |      
|Savía Perú                                       |  |                                 |      
|Gross wells                                      |  |                                 | 20   
|Net wells(1)                                     |  |                                 | 10   
|Ecopetrol America Inc.                           |  |                                 |      
|Gross wells                                      |  |                                 | -    
|Net wells(1)                                     |  |                                 | -    
|Total gross wells (International)                |  |                                 | 20   
|Total net wells (International)                  |  |                                 | 10   








| | (1) | Net wells correspond to the sum of wells entirely owned by us (or Hocol, Equión or Savía
Perú, as the case may be) and our ownership percentage of wells owned in joint ventures with our partners.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | The joint venture from the Central region was reclassified as part of the Eastern region in 2012.
| | --- | -------------------------------------------------------------------------------------------------

| | (3) | Figures are not included for the Eastern region for 2011, as it was the year of the Eastern region’s
creation.
| | --- | --------------------------------------------------------------------------------------------------------------



Production Activities in Colombia



Our average daily production
of crude oil in Colombia reached 644 thousand bpd in 2013, a 2.8% increase compared with 2012. The increase in our average daily
production is mainly due to a 2.2% increase in production from fields operated by us, which totaled 357 thousand bpd in 2013 compared
with 349 thousand bpd in 2012.



During 2012, we had an
average daily production of crude oil of 627 thousand bpd of crude oil, which represents a 2.9% growth compared with 2011. This
increase in our average daily production was due to a 7.7% increase in production from fields operated by us, which totaled 349
thousand bpd in 2012 compared with 324 thousand bpd in 2011.



-38-







The following table sets
forth our average daily crude oil production, prior to deducting royalties, for the years ended December 31, 2013, 2012 and
2011.



|                                                         |  | For the year ended December 31, |     
|-------------------------------------------------------- |  | ------------------------------- | ----
|                                                         |  | 2013                            |     
|                                                         |  | (thousand bpd)                  |     
|COLOMBIA                                                 |  |                                 |     
|Ecopetrol S.A.                                           |  |                                 |     
|Northeastern region:                                     |  |                                 |     
|Joint venture operation                                  |  |                                 | 25  
|Direct operation                                         |  |                                 | 19  
|Total Northeastern region                                |  |                                 | 43  
|Mid-Magdalena Valley region:                             |  |                                 |     
|Joint venture operation                                  |  |                                 | 24  
|Direct operation                                         |  |                                 | 80  
|Total Mid-Magdalena Valley region                        |  |                                 | 104 
|Central region(1):                                       |  |                                 |     
|Joint venture operation                                  |  |                                 | -   
|Direct operation                                         |  |                                 | 189 
|Total Central region                                     |  |                                 | 189 
|Eastern region(2):                                       |  |                                 |     
|Joint venture operation                                  |  |                                 | 159 
|Direct operation                                         |  |                                 | 1   
|Total Eastern region                                     |  |                                 | 160 
|Catatumbo-Orinoquía region:                              |  |                                 |     
|Joint venture operation                                  |  |                                 | 53  
|Direct operation                                         |  |                                 | 2   
|Total Catatumbo-Orinoquía region                         |  |                                 | 55  
|Southern region:                                         |  |                                 |     
|Joint venture operation                                  |  |                                 | 21  
|Direct operation                                         |  |                                 | 34  
|Total Southern region                                    |  |                                 | 55  
|Minor fields:                                            |  |                                 |     
|Joint venture operation                                  |  |                                 | 3   
|Direct operation                                         |  |                                 | 3   
|Total Minor fields                                       |  |                                 | 6   
|Hocol(1)                                                 |  |                                 |     
|Joint venture operation                                  |  |                                 | 2.6 
|Direct operation                                         |  |                                 | 18.6
|Total Hocol                                              |  |                                 | 21.2
|Equión                                                   |  |                                 |     
|Joint venture operation                                  |  |                                 | -   
|Direct operation                                         |  |                                 | 10  
|Total Equión                                             |  |                                 | 10  
|Production tests                                         |  |                                 | -   
|Total average daily crude oil production (Colombia)      |  |                                 | 644 
|INTERNATIONAL                                            |  |                                 |     
|Savía Perú                                               |  |                                 | 5   
|Ecopetrol America Inc.                                   |  |                                 | 1.4 
|Total average daily crude oil production (International) |  |                                 | 6.4 
|TOTAL AVERAGE DAILY CRUDE OIL PRODUCTION                 |  |                                 | 651 










| | (1) | The joint venture from the Central region was reclassified as part of the Eastern region in 2012.
| | --- | -------------------------------------------------------------------------------------------------

| | (2) | Figures are not included for the Eastern region for 2011, as it was the year of its creation.
| | --- | ---------------------------------------------------------------------------------------------



-39-







The following table sets
forth our developed and undeveloped gross and net acreage of crude oil and natural gas production by region for the year ended
December 31, 2013.



|                            |  | Production acreage as of December 31, 2013 |         |  | Average crudeoil and naturalgas productionfor the yearendedDecember 31,2013(1) | 
|--------------------------- |  | ------------------------------------------ | ------- |  | ------------------------------------------------------------------------------ | 
|                            |  | Developed                                  |         |  | Undeveloped                                                                    | 
|                            |  | Gross                                      |         |  | Net                                                                            | 
|                            |  | (in acres)                                 |         |  |                                                                                | 
|COLOMBIA                    |  |                                            |         |  |                                                                                | 
|Ecopetrol S.A.              |  |                                            |         |  |                                                                                | 
|Northeastern region         |  |                                            | 83,078  |  |                                                                                | 
|Mid-Magdalena Valley region |  |                                            | 77,219  |  |                                                                                | 
|Central region              |  |                                            | 28,997  |  |                                                                                | 
|Eastern region              |  |                                            | 96,790  |  |                                                                                | 
|Catatumbo-Orinoquía region  |  |                                            | 51,716  |  |                                                                                | 
|Southern region             |  |                                            | 45,639  |  |                                                                                | 
|Minor fields                |  |                                            | 6,712   |  |                                                                                | 
|Hocol                       |  |                                            | 4,291   |  |                                                                                | 
|Equión                      |  |                                            | 21,757  |  |                                                                                | 
|Total (Colombia)            |  |                                            | 416,199 |  |                                                                                | 
|INTERNATIONAL               |  |                                            |         |  |                                                                                | 
|Savía Perú                  |  |                                            | 80,725  |  |                                                                                | 
|Ecopetrol America Inc. (2)  |  |                                            | 20,880  |  |                                                                                | 
|Total (International)       |  |                                            | 101,605 |  |                                                                                | 
|Total                       |  |                                            | 517,804 |  |                                                                                | 










| | (1) | Does not include 0.3 thousand bpd of production from exploratory activities.
| | --- | ----------------------------------------------------------------------------

| | (2) | Production and acreage from Ecopetrol America Inc. is related to the K2 field lease contracts in
the Gulf of Mexico. There are five lease contracts, four of which are in the production stage and do not have expiration dates,
while one is an exploratory lease that expires on June 30, 2016. For the Dalmatian production acreage five leases are included
as undeveloped acreage until production starts. These leases do not have an expiration date.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The following table sets
forth our total gross and net productive wells by region for the year ended December 31, 2013.



-40-







|                            |  | As of December 31, 2013 |      
|--------------------------- |  | ----------------------- | -----
|                            |  | Crude Oil               |      
|                            |  | Gross                   |      
|COLOMBIA                    |  |                         |      
|Ecopetrol S.A.              |  |                         |      
|Northeastern region         |  |                         | 73   
|Mid-Magdalena Valley region |  |                         | 3,371
|Central region              |  |                         | 563  
|Eastern region              |  |                         | 810  
|Catatumbo-Orinoquía region  |  |                         | 659  
|Southern region             |  |                         | 797  
|Minor fields                |  |                         | 153  
|Hocol                       |  |                         | 194  
|Equión                      |  |                         | 44   
|Total (Colombia)            |  |                         | 6,664
|INTERNATIONAL               |  |                         |      
|Savía Perú                  |  |                         | 648  
|Ecopetrol America Inc.      |  |                         | 7    
|Total (International)       |  |                         | 655  
|Total                       |  |                         | 7,319



We consider crude oil
wells to be those in which the main operation is oil production, although many of these wells produce gas associated with oil production
that, in some cases, have a commercial purpose. Natural gas wells are those in which operations are directed only towards production
of commercial gas. The above table reflects the productive wells that directly contribute to hydrocarbons production and therefore
excludes wells used for injection, disposal, captation, or other similar activities.



Crude Oil



Volume of Crude Oil Purchased



The table below sets forth
the volumes of crude oil purchased from our business partners and third parties and volumes of crude oil purchased from the ANH
corresponding to royalties that have been received by the ANH in-kind from producers for the years ended December 31, 2013,
2012 and 2011.



|                                                                 |  | For the year ended December 31, |     
|---------------------------------------------------------------- |  | ------------------------------- | ----
|                                                                 |  | 2013                            |     
|                                                                 |  | (million barrels)               |     
|Ecopetrol S.A.(1)                                                |  |                                 |     
|Crude oil purchased from the ANH                                 |  |                                 | 49.5
|Crude oil purchased from our business partners and third parties |  |                                 | 18.9
|Hocol                                                            |  |                                 |     
|Crude oil purchased from our business partners and third parties |  |                                 | 9.7 
|Equión                                                           |  |                                 |     
|Crude oil purchased from our business partners and third parties |  |                                 | 3.3 
|Total                                                            |  |                                 | 81.4








(1)	Crude oil purchased from the ANH,
our business partners and third parties is either processed by our Refining and Petrochemicals segment or is exported.



-41-







Purchase Commitments with Our Business
Partners and Third Parties



We have signed a number
of crude oil purchase contracts with certain of our business partners and third parties. Crude oil purchased from the ANH and our
business partners is either processed in ourrefineries or exported. The purchase price is calculated based on international
market prices. Consequently, part of our financial exposure under these contracts depends on international oil prices. We believe
that the risk of such exposure is naturally hedged since we either export the crude oil at international market prices or sell
refined products at prices which are correlated with international market prices. Under most of our existing contracts, the purchases
are subject to the pipeline capacity.



The term of some of our
purchase contracts is linked to the term of the joint venture agreements signed with our business partners. Other clauses of the
contracts such as price and place of delivery may be subject to renegotiation during the term of the contract. Certain purchase
contracts not linked to joint venture agreements may be extended and renegotiated by the parties. During 2013, total volumes of
crude oil Ecopetrol S.A. purchased from our business partners and third parties amounted to 51.7 thousands bpd, representing 15.9%
of our total crude oil volume sales.



Import of Diluents



We have increased imports
of naphtha, used as a diluent to allow our heavy crudes to be pumped through pipelines. In 2013, we imported 50.7 thousand bpd
of naphtha as compared to 39.6 thousand bpd in 2012. The additional imports of diluents in 2013 were mainly due to the growth in
production of heavy grades.



Light Crude Oil



Light crude oil has API
gravity 35° or higher and tends to have a higher sales price in the international market. We develop and produce
light crude oil in the Cusiana, Cupiagua, Pauto and Floreña fields. During 2013, 2012 and 2011, Ecopetrol S.A.’s production
of light crude oil was 49 thousand, 60 thousand and 61 thousand bpd, respectively.



Heavy Crude Oil



We consider heavy crudes
as those with API gravity below 15°. Ecopetrol S.A. develops, upgrades and produces heavy crude in the Central,
Eastern and Mid-Magdalena Valley regions. Ecopetrol S.A.’s production of heavy crude oil increased from 24 thousand bpd in
2000 to 348 thousand bpd in 2013 and production from 2012 to 2013 increased 15% as a result of the development of the Rubiales,
Castilla and Chichimene fields.In 2012, Ecopetrol S.A.’s production of heavy crudes amounted to 304 thousand
bpd, compared with 278 thousand bpd produced in 2011, mainly as a result of the development of the same fields. We are committed
to developing our heavy crude reserves as they are a key element of our growth strategy.



Our most important heavy
crude oil projects are:



| | · | Cubarral. The Cubarral block is located in the Central region and is comprised of the Castilla
and Chichimene fields. Together, these fields in 2013 produced approximately 166 thousand bpd, a 6.7% increase compared with 2012
production.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Rubiales - Quifa. The Rubiales and Quifa fields are located in the Eastern region and are developed
in joint venture with Metapetroleum. The Rubiales and Quifa fields increased our production from 124.9 thousand bpd in 2012 to
153.5 thousand bpd in 2013.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-42-







Marketing of Crude Oil





Our crude oil export sales are made both
in the spot market and through long-term contracts, primarily to refiners in the U.S. Gulf Coast, Asia, Europe and the U.S. West
Coast.







Natural Gas



In 2013, our average daily
production of natural gas in Colombia reached 137 thousand boepd, a 16.1% increase when compared with 2012 production. Natural
gas production increased by 9.3% in 2012 compared with 2011.



The following table sets
forth our average daily natural gas production, prior to deducting royalties, for the years ended December 31, 2013, 2012
and 2011.



|                                             |  | For the year ended December 31, |    
|-------------------------------------------- |  | ------------------------------- | ---
|                                             |  | 2013                            |    
|                                             |  | (Thousand boepd )(1)            |    
|COLOMBIA                                     |  |                                 |    
|Ecopetrol S.A.                               |  |                                 |    
|Northeastern region:                         |  |                                 |    
|Joint Venture                                |  |                                 | 97 
|Direct Operation                             |  |                                 | 20 
|Total Northeastern region                    |  |                                 | 118
|Mid-Magdalena Valley region:                 |  |                                 |    
|Joint Venture                                |  |                                 | 2  
|Direct Operation                             |  |                                 | 5  
|Total Mid-Magdalena Valley region            |  |                                 | 7  
|Central region:                              |  |                                 |    
|Joint Venture                                |  |                                 | -  
|Direct Operation                             |  |                                 | 1  
|Total Central region                         |  |                                 | 1  
|Eastern region:(2)                           |  |                                 |    
|Joint Venture                                |  |                                 | -  
|Direct Operation                             |  |                                 | -  
|Total Eastern region                         |  |                                 | -  
|Catatumbo-Orinoquía region:                  |  |                                 |    
|Joint Venture                                |  |                                 | -  
|Direct Operation                             |  |                                 | -  
|Total Catatumbo-Orinoquía region             |  |                                 | 1  
|Southern region:                             |  |                                 |    
|Joint Venture                                |  |                                 | -  
|Direct Operation                             |  |                                 | 1  
|Total Southern region                        |  |                                 | 1  
|Minor fields:                                |  |                                 |    
|Joint venture operation                      |  |                                 | -  
|Direct operation                             |  |                                 | -  
|Total Minor fields                           |  |                                 | 1  
|Hocol                                        |  |                                 |    
|Joint venture operation                      |  |                                 | -  
|Direct operation                             |  |                                 | -  
|Total Hocol                                  |  |                                 | -  
|Equión(3)                                    |  |                                 |    
|Joint venture operation                      |  |                                 | -  
|Direct operation                             |  |                                 | 8  
|Total Equión                                 |  |                                 | 8  
|Production Tests                             |  |                                 | -  
|Total Natural Gas Production (Colombia)      |  |                                 | 137
|INTERNATIONAL                                |  |                                 |    
|Savía Perú                                   |  |                                 | 1  
|Ecopetrol America Inc.                       |  |                                 | -  
|Total Natural Gas Production (International) |  |                                 | 1  
|Total Natural Gas Production                 |  |                                 | 137








| | (1) | Conversion between mcfpd and boepd is performed at 5,700 mcfpd to 1 boepd.
| | --- | --------------------------------------------------------------------------

| | (2) | Figures are not included for the Eastern region for 2011, as it was the year of its creation.
| | --- | ---------------------------------------------------------------------------------------------

| | (3) | Equión production figures correspond to its equivalent daily productions since its month
of acquisition in the year 2011.
| | --- | -------------------------------------------------------------------------------------------------------------------------



-43-









The largest production of natural gas in
Colombia is located in the Northeastern region, which we develop primarily under joint venture contracts. We developed the Guajira
natural gas reserves with our partner Chevron. The Cusiana reserve is developed along with Equión and Sinochem Petroleum
Exploration and Production (SPEP). Ecopetrol S.A. directly operates the reserves in the Cupiagua field, where the Cupiagua gas
plant is located. This plant is connected with the Cusiana field through the Cupiagua-Cusiana gas pipeline. In 2013, we increased
the use of the pipeline by 19,479 thousand bpd, from 652 to 20,131 thousand bpd, in order to supply the Cupiagua gas plant, which
started operations on December 14, 2012.







Natural gas production
in the Northeastern region averaged 648.7 mcfpd and 3.9 thousand bpd of liquids from the natural gas process in 2013. The natural
gas produced from these fields is used to supply local demand and to meet our commitments to supply natural gas to Venezuela. See
“Item 4. Information on the Company—Marketing and Supply—Natural Gas Distribution.” In order to mantain
the production of liquids, we continue re-injection of natural gas in the Cusiana field as part of our improved oil recovery strategy.
This production outcome was boosted by production in the Chuchupa, Ballena and Riohacha fields operated by Chevron, which represented
a production of 336.2 mcfpd in 2013 and 339.0 mcfpd in 2012.



Natural Gas Distribution



Summary



Development of natural
gas reserves began in the 1970s with the discovery of the Guajira fields in the Northeastern region and subsequent discovery in
the Piedemonte Llanero. In Colombia, we have been selling natural gas to local distribution companies, power generators and large
customers. We have also been exporting natural gas to Venezuela.



As a result of the growth
of natural gas demand from Venezuela and the increase in domestic consumption of gas-powered plants in recent years, the total
demand for natural gas, including natural gas exports in 2013 was 1,228 gbtud, representing a 12.6% increase with respect to 1,090
gbtud demanded in 2012. In 2011, demand was 1,062 gbtud, while in 2010 demand was 1,061 gbtud. Ecopetrol in 2013 supplied 54.4%
(668 gbtud) of the total natural gas demand in Colombia, with production used for our own consumption by refineries and for sale
to natural gas distributors, for compressed natural gas for vehicles, to power plants, to the industrial sector and for export.



Today there are more than
30 natural gas distribution companies with operations in Colombia. We sell natural gas to distribution companies through firm,
interruptible contracts and conditional contracts. Those distributors supply natural gas to the residential market, for compressed
natural gas for vehicles and to industries in Colombia.



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Compressed Natural Gas



According to our calculations,
the demand for natural gas for vehicles in Colombia increased by 5.4% between 2013 and 2012, from 76.4 gbtud to 80.5 gbtud. This
increase is mainly due to an increase in the number of vehicles running with compressed natural gas in response to incentives offered
by companies engaged in marketing and delivery of compressed natural gas. According to industry sources, as of December 31, 2013,
a total of 461,957 vehicles had been converted to natural gas, an increase of 44,546 vehicles over the total of 417,411 that had
been converted in 2012. In 2013, we amended four of the agreements for the supply of compressed natural gas in the Colombian Atlantic
Coast, Bucaramanga, Western region and Bogota in order to maintain the current incentives program that fosters conversions of motor
vehicles in these regions from gasoline to natural gas. In addition, we began an early stage of planning and implementation of
new incentives programs in the southern part of the country and in the Llanos region.



Natural Gas Sales to the Power and
Industrial Sector



We market and sell natural
gas to the industrial sector and to gas-fired and combined cycle power plants. We have two long-term supply contracts with power
generators under which such companies have entered into take-or-pay contracts and purchase-and-supply obligations for the supply
of natural gas. During 2013, Ecopetrol sold 526.8 gbtud in the local market to clients from different sectors such as distributors,
industries and power plants. Sales growth in 2013 is mainly explained by the increase of sales to power plants generators and distributors.



The following table sets
forth our local deliveries of natural gas including deliveries to our refineries, during 2013, 2012 and 2011.



|                                    |  | For the year ended December 31, |      
|----------------------------------- |  | ------------------------------- | -----
|                                    |  | 2013                            |      
|                                    |  | (gbtud)                         |      
|Gas-fired power plants              |  |                                 | 103.1
|Refineries                          |  |                                 | 119.1
|Petrochemical                       |  |                                 | 3.2  
|Industrial                          |  |                                 | 152.7
|Distributors                        |  |                                 | 102.8
|Compressed Natural Gas for vehicles |  |                                 | 40.5 
|Producers                           |  |                                 | 5.3  
|Total Deliveries                    |  |                                 | 526.8










| | (1) | Deliveries to distributors include deliveries to industrial clients that are required to purchase
natural gas from distributors.
| | --- | --------------------------------------------------------------------------------------------------------------------------------



Natural Gas Exports



In 2007, we and Chevron
entered into a long-term natural gas supply contract with PDVSA through the end of 2011. In 2011, we extended the natural gas export
contract until June 2014. Pursuant to the terms of the agreement, we have agreed to deliver the following quantities of natural
gas to Venezuela, for which Chevron assumed 43%, and Ecopetrol 57%, of the responsibility:



|                                     |  | For the year ended December 31, |      
|------------------------------------ |  | ------------------------------- | -----
|                                     |  | 2012(3)                         |      
|                                     |  | (gbtud)                         |      
|Gas delivery commitments to PDVSA(1) |  |                                 | 127.2










| | (1) | The quantities for each month are different, for that reason the volume per year is a weighted
average.
| | --- | -------------------------------------------------------------------------------------------------------

| | (2) | The quantity for 2014 is a weighted average from January to June 2014.
| | --- | ----------------------------------------------------------------------

| | (3) | Total gas delivery commitment to PDVSA.
| | --- | ---------------------------------------



| | (4) | Through the amendment of its agreement with PDVSA signed on May 22, 2013, Ecopetrol S.A. agreed
to sell larger fixed amounts of gas than the amount originally agreed for 2013, due to higher surplus of gas that was not sold
in Colombia. The additional clause contemplated the sale of, on average, an additional 42 gbtud between May 27 and December 31,
2013.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-45-







In 2013, we and our partner
Chevron delivered 204.0 gbtud to PDVSA, exceeding the quantity of natural gas we agreed to supply in our gas export contract. This
represented a 9.4% increase in the natural gas sold to PDVSA as compared to 2012. Of the total volume of gas delivered in 2013,
68% came from us and 32% came from Chevron. In 2012 and 2011, we and Chevron delivered 186.4 gbtud and 204.4 gbtud respectively.



Natural Gas Delivery Commitments



In 2011, we participated
with the Colombian Commission for Regulation of Energy and Gas (CREG) in the definition and implementation of new rules for marketing
gas in the mid-term. In accordance with this new regulatory framework, we updated our committed natural gas volumes for the years
2012 and 2013. In August 2013 CREG issued new guidelines for the sale of natural gas through Resolution 089 of 2013. In accordance
with the new guidelines, a marketing process for natural gas was held in which 38 contracts were signed with 23 companies. Through
that process, we sold 100% of Ecopetrol’s Guajira gas (120 gbtud for one year and 23 gbtud for five years) and 99% of the
Ecopetrol’s Cusiana and Cupiagua gas for one (280 gbtud) and 80% for five years (232 gbtud). These commitments are in addition
to existing engagements (93 gbtud from Guajira and 45.8 gbtud from Cusiana/Cupiagua). The table below sets forth the commitments
we have in firm contracts with local natural gas distribution companies, local industries, gas fired power generators, international
companies, including PDVSA in Venezuela, and internal agreements with our refineries and fields.



|                               |  | For the year ended December 31, |    
|------------------------------ |  | ------------------------------- | ---
|                               |  | 2014                            |    
|                               |  | (gbtud)                         |    
|Volume for sales third parties |  |                                 | 556
|Volume for self-consumption    |  |                                 | 131
|Total Commitments              |  |                                 | 687



Pursuant to long-term
supply contracts and other agreements, we must supply natural gas to these parties, and failure to deliver the agreed amounts could
result in fines under the contracts.



In order to meet our natural
gas delivery commitments, we have three main natural gas production fields, the Guajira, the Cusiana and the Gibraltar fields.
Of our total natural gas production as of December 31, 2013, 54.6% was supplied by the Guajira production, 17.3% from the Cusiana
field, 7.8% from the Cupiagua field, 2.7% from the Gibraltar field and the remaining 17.6% from fields located in other regions.
Our participation in the Colombian natural gas market in 2013, including export volumes, decreased to 54.4%; our participation
in 2012 was 56.3% and in 2011 it was 62.0%.



During 2013, Ecopetrol
did not have to pay any penalties for the non-delivery of natural gas. In 2012, we paid Ps$9.2 billion mainly in compensation for
the non-delivery of natural gas. The penalties resulted from delays in the beginning of new projects, mainly the Planta de Gas
Cupiagua and the expansion project of the Guajira fields.



Lifting and
Production Costs



Our consolidated average
production costs on a Peso basis increased to Ps$23,601 during 2013 from Ps$23,088 during 2012. This was mainly due to: (1) increased
costs from joint ventures, related to higher volumes of water production and related disposal costs, (2) high-price clauses in
our joint venture agreements, which assign additional production to us when oil prices are higher than a reference price, (3) increase
in maintenance costs for improved integrity of surface equipment (4) a 5.37% increase in production volumes of oil (not including
production tests and discovered undeveloped fields), and (5) an increase in direct operation costs. Our consolidated average lifting
costs on a dollar basis decreased to US$11.57 in 2013 from US$11.93 in 2012, as a result of the above-mentioned factors and a 3.9%
depreciation of the average exchange rate of the Peso against the U.S. dollar.



-46-







Our consolidated average
production costs on a Peso basis increased to Ps$23,088 during 2012 from Ps$21,605 during 2011. This was mainly due to: (1) increased
costs from joint ventures, related to higher volumes of water production and related disposal costs, (2) high-price clauses in
our joint venture agreements, which assign additional production to us when oil prices are higher than a reference price, (3) a
2.62% increase in production volumes and (4) an increase in direct operation costs. Our consolidated average lifting costs on a
dollar basis increased from US$10.43 in 2011 to US$11.93 in 2012 as a result of the above-mentioned factors, partially offset by
a 2.7% appreciation of the average exchange rate of the Peso against the U.S. dollar. Our consolidated average lifting costs
differ from our consolidated average production costs because our lifting costs do not include costs related to consumption of
hydrocarbons by Ecopetrol included in the production process and our small refineries and natural gas liquid plants.



The following table sets
forth our crude oil and natural gas average sales price, aggregate average lifting costs and aggregate average unit production
costs for the years ended December 31, 2013, 2012 and 2011.



|                                        |  | For the year ended December 31, |        
|--------------------------------------- |  | ------------------------------- | -------
|                                        |  | 2013                            |        
|Crude oil average sales price           |  |                                 |        
|(U.S. dollars per barrel)(1)            |  |                                 | 98.85  
|Crude oil average sales price           |  |                                 |        
|(Ps$ per barrel)(1)                     |  |                                 | 184,768
|Natural gas average sales price         |  |                                 |        
|(U.S. dollars per barrel equivalent)    |  |                                 | 26.99  
|Natural gas average sales price         |  |                                 |        
|(Ps$ per barrel equivalent)             |  |                                 | 50,448 
|Aggregate average unit production costs |  |                                 |        
|(U.S. dollars per boe)(2)               |  |                                 | 12.63  
|Aggregate average unit production cost  |  |                                 |        
|(Ps$ per boe)(2)                        |  |                                 | 23,601 
|Aggregate average lifting costs         |  |                                 |        
|(U.S. dollars per boe)(3)(4)            |  |                                 | 11.57  
|Aggregate average lifting costs         |  |                                 |        
|(Ps$ per boe)(3)(4)                     |  |                                 | 21,624 








| | (1) | Corresponds to our average sales price on a consolidated basis.
| | --- | ---------------------------------------------------------------

| | (2) | Unit production costs correspond to consolidated average costs on total production volumes net
of royalties. Production costs do not include costs related to transport, commercialization and administrative expenses.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (3) | Lifting costs per barrel are calculated based on total production (excluding production tests and
discovered undeveloped fields), which are net of royalties, and correspond to our lifting costs on a consolidated basis.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (4) | Aggregate average lifting costs is calculated by using the cost of production (excluding costs
related to hydrocarbons consumption by Ecopetrol included in the production process, such as by our small refineries and natural
gas liquid plants) and dividing by the net produced volume (excluding royalties).
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Reserves



The estimated reserve
amounts presented in this report, as of December 31, 2013, are related to hydrocarbon prices, which are based on the average
prices during the 12-month period prior to the ending date of the period covered in this report, determined as the unweighted arithmetic
averages of the prices in effect on the first-day-of-the-month for each month within such period, unless prices were defined by
contractual arrangements, as required by the SEC regulations. See “Item 5. Operating and Financial Review and Prospects—Critical
Accounting Policies and Estimates—Oil and Gas Reserves” and Note 35 to our consolidated financial statements.



-47-







Our proved reserves of
crude oil and natural gas, net of royalties to the Nation, as of December 31, 2013, totaled 1,971.9 million boe, which
represents a 5.1% increase from the 1,876.7 million boe registered in 2012. Our crude oil proved reserves in 2013 were 1,433.6 million
barrels of crude oil and, in 2012, 1,370.3 million barrels of crude oil. Our natural gas proved reserves increased to 3,068.4 billion
bcf from 2,886 bcf of reserves in 2012. In 2012, our proved reserves increased 1.1% from the 1,856.7 million boe registered
in 2011. The increase in our reserves in 2013 is mainly due to (1) a 231.9 million boe increase corresponding to revisions
of previous estimates, (2) a 26.7 million boe increase corresponding to improved recovery, (3) a 9.4 million boe increase
corresponding to purchases of minerals, (4) a 74.9 million boe increase corresponding to extensions and discoveries, (5) a
2.8 million boe decrease corresponding to sales of minerals, and (6) a 244.9 million boe decrease corresponding
to production.



Hydrocarbon reserves were
calculated in accordance with SEC regulations and the requirements of the Financial Accounting Standards Board, or FASB. Ecopetrol’s
reserves process is supervised and coordinated by the Reserves Director, who reports to the Chief Financial Officer. The Reserves
Director is a petroleum engineer, with a Master’s degree in petroleum engineering and who has 40 years of experience in reservoir
engineering, integrated reservoir studies, field development, reservoir management and estimation and reporting of reserves at
several companies. The reserves audit group is comprised of reserves coordinators who are petroleum engineers, each with more than
10 years of experience in reservoir characterization, field development, estimation and reporting of reserves and who have supervision
and supporting responsibilities over the professionals involved in the estimation and reporting process.



Our crude oil and natural
gas net proved reserves include reserves from our subsidiaries located in the United States (Gulf of Mexico) and Peru, and Equión
and Hocol’s assets in Colombia. Reserves are first estimated internally. The estimation process is supervised and coordinated
by the Corporate Manager of Reservoirs, a geologist who holds a Master’s degree in geology and has more than 20 years of
experience in projects associated with reservoir characterization and development, estimation, and reporting of reserves. The employees
involved in the reserves process meet the Society of Petroleum Engineers’ qualifications for reserves estimators. Internally
estimated reserves are submitted to an external audit process, which was conducted by the external engineers (Ryder Scott, DeGolyer
and MacNaughton and Gaffney, Cline & Associates). These firms have audited 99% of our total net proved reserves for 2013, 2012
and 2011. According to our corporate policy, we report the reserves values obtained from the external engineers.



Ecopetrol uses deterministic
methods that are commonly used internationally to estimate reserves. These methods have some uncertainty with respect to degradation,
and thus, the estimates should not be interpreted as being exact amounts. However, the technology used to estimate reserves is
considered reliable.



Estimates of reserves
were prepared by geological and engineering standard methods commonly used in the oil and gas industry. The method or combination
of methods used in the analysis of each reserve was adopted from experience analogy reserves, including information on the stage
of development, quality and completeness of basic data and production history.



The majority of the producing
proved reserves were estimated by applying appropriate decline curves or other performance relationships. In analyzing decline
curves, reserves were estimated by calculating economic limits that are based on current economic conditions. In certain cases,
where the methods previously employed could not be used, reserves were estimated by analogy with similar reserves for which more
complete data was available.



The reserves estimation
process ends when the Director of Reserves consolidates the results and presents them to the Reserves Committee, whose members
are the Chief Financial Officer, the Exploration and Production Executive Vice-President and the Vice-President of Strategy. Results
are presented to the Audit Committee of the Board of Directors and finally approved by the Board of Directors.



The reserves audit process
was conducted in accordance with SEC definitions and rules set forth in Rule 4-10(a) of Regulation S-X and the disclosure guidelines
contained in the SEC’s Modernization of Oil and Gas Reporting final rule dated December 31, 2008 and effective as of
January 1, 2010.



The following table sets
forth our estimated net proved reserves (developed and undeveloped) of crude oil and gas by region for the years ended December 31,
2013, 2012 and 2011.



-48-







|                                                  |  | As of December 31, |                            
|------------------------------------------------- |  | ------------------ | ---------------------------
|                                                  |  | 2013               |                            
|                                                  |  |                    | Crude Oil (million barrels)
|PROVED DEVELOPED RESERVES                         |  |                    |                            
|Total (Colombia)                                  |  |                    | 921.31                     
|Total (International)                             |  |                    | 11.67                      
|North America                                     |  |                    | 1.45                       
|South America                                     |  |                    | 10.22                      
|TOTAL PROVED DEVELOPED RESERVES                   |  |                    | 933.0                      
|PROVED UNDEVELOPED RESERVES                       |  |                    |                            
|Total (Colombia)                                  |  |                    | 480.26                     
|Total (International)                             |  |                    | 20.38                      
|North America                                     |  |                    | 11.42                      
|South America                                     |  |                    | 8.96                       
|TOTAL PROVED UNDEVELOPED RESERVES                 |  |                    | 500.6                      
|TOTAL PROVED RESERVES (DEVELOPED AND UNDEVELOPED) |  |                    | 1,433.6                    





The following table describes
the changes to our proved developed and undeveloped reserves estimates through the past three fiscal years.



Net proved developed and undeveloped
reserves



|                                 |  | Crude Oil (million barrels) |         |   | Gas (bcf) |  |         | Total (million boe) | 
|-------------------------------- |  | --------------------------- | ------- | - | --------- |  | ------- | ------------------- | 
|Reserves as of December 31, 2011 |  |                             | 1,371.0 |   |           |  | 2,768.4 |                     | 
|Revisions of previous estimates  |  |                             | 42.7    |   |           |  | 8.8     |                     | 
|Improved recovery                |  |                             | 65.3    |   |           |  | 0.0     |                     | 
|Purchases of minerals in place   |  |                             | 0.0     |   |           |  | 0.0     |                     | 
|Extensions and discoveries       |  |                             | 90.4    |   |           |  | 298.6   |                     | 
|Production                       |  |                             | (199.2  | ) |           |  | (189.3  | )                   | 
|                                 |  |                             |         |   |           |  |         |                     | 
|Reserves as of December 31, 2012 |  |                             | 1,370.3 |   |           |  | 2,886.5 |                     | 
|Revisions of previous estimates  |  |                             | 172.7   |   |           |  | 337.5   |                     | 
|Improved recovery                |  |                             | 23.2    |   |           |  | 19.9    |                     | 
|Purchases of minerals in place   |  |                             | 7.5     |   |           |  | 11.0    |                     | 
|Extensions and discoveries       |  |                             | 66.2    |   |           |  | 49.3    |                     | 
|Sales of minerals in place       |  |                             | (0.6    | ) |           |  | (12.3   | )                   | 
|Production                       |  |                             | (205.7  | ) |           |  | (223.5  | )                   | 
|Reserves as of December 31, 2013 |  |                             | 1,433.6 |   |           |  | 3,068.4 |                     | 
|                                 |  |                             |         |   |           |  |         |                     | 
|Net proved developed reserves    |  |                             |         |   |           |  |         |                     | 
|As of December 31, 2011          |  |                             | 855.8   |   |           |  | 2,229.5 |                     | 
|As of December 31, 2012          |  |                             | 933.3   |   |           |  | 2,535.9 |                     | 
|As of December 31, 2013          |  |                             | 933.0   |   |           |  | 2,663.3 |                     | 



The above-referenced reserve
amounts, net of royalty payments to the Nation, are the same amounts used to reconcile Note 35 to our consolidated financial statements
under FASB ASC 932.



-49-







Revisions



In 2013, net revisions
increased reserves by 231.9 million boe. The main revisions are in Colombian fields. Our most important heavy crude oil projects
in Castilla, Chichimene, Rubiales and Quifa Fields drove a 91.7 million boe increase in reserves. New development projects in Castilla
Field units K1 and K2 caused a 68.2 million boe increase in reserves and development activities and improved reservoir performance
in Chichimene, Rubiales and Quifa Fields accounted for a 23.4 million boe increase.



Increases in sales of
natural gas in Cupiagua Field and in Pauto field accounted for a 45.5 million boe and a 9.7 million boe increase in reserves, respectively.
Revisions in Yarigui, Tisquirama, Provincia, Galan, San Roque and Cusiana fields as a result of drilling activities and better
production performance accounted for a 32.4 million boe increase in reserves.



The revisions described
above accounted for 77% of the increase in reserves due to revisions in 2013. The remaining 23% (52.6 million boe) were due to
varying increases and decreases from other fields.



Improved Recovery



In 2013, improved recovery
increased reserves by 26.7 million boe. The additions were associated with the continued development of waterflood projects through
existing wells, though additional drilling may be required to fully optimize the development configuration. The main additions
were in Yarigui field, representing a 6.7 million boe increase, Tibu field, representing a 5.4 million boe increase and Peñas
Blancas field, representing a 4.9 million boe increase.



Extensions and Discoveries



The Company’s extensions
and discoveries during 2013 amounted to 74.9 million boe, which corresponded to 39.8 million boe of newly discovered fields and
35.1 million boe of extensions of proved acreage. The newly discovered fields corresponded to our Akacias, Caño Sur and
Vigia Sur fields.



In terms of the extensions
of proved acreage, which amounted to 35.1 million boe, 68% was associated with activities in the followings fields: 7.7 million
boe related to new proved areas in the Hocol’s Mamey field; 8.8 million boe related to new proved areas in the Rubiales and
Quifa fields; and 7.4 million boe related to new proved areas in La Cira and Infantas fields. The remaining 32% corresponds to
smaller changes in several other Company fields.



Purchases



In 2013, purchases of
participation interests increased liquid volumes by 9.4 million boe, as a result of our acquisition of a 31.5% participation in
Gunflint field through our subsidiary Ecopetrol America Inc. See Item 4 “Information on the Company – Overview by Business
Segment - Exploration Activities Outside of Colombia”



Sales



In 2013, sales of participation
interests decreased reserves by 2.8 million boe, as a result of a sale of part our equity interest in the Dificil and Entrerrios
fields in Colombia.



Proved Undeveloped Reserves



In terms of proved undeveloped
reserves, during 2013 the Company added approximately 220 million boe and converted 147 million boe. Total proved undeveloped reserves
increased by 73 million boe to 572 million boe at December 31, 2013 when compared with 498 million boe at December 31, 2012. On
December 31, 2013, 88% of our total proved undeveloped reserves corresponded to crude oil.



-50-







The company’s year-end
development plans are consistent with SEC guidelines for the development of proved undeveloped reserves within five years.



Of the total amount of
proved undeveloped reserves that we had at the end of 2012 (498 million boe), we converted approximately 147 million boe, or 29%,
to proved developed reserves during 2013, primarily associated with the development of crude oil projects through drilling and
workovers in Castilla, Rubiales, Pidemonte, La Cira Infantas, Quifa Suroeste, Apiay, Casabe, Suria and Palagua fields. These projects
accounted for approximately 81% of the total conversion. The conversion of the remaining 19% is associated with development execution
in other fields such as the Ocelote, Suria Sur, Yarigui-Cantagallo and Gala fields, among others. The amount of investments made
during 2013 to convert proved undeveloped reserves to proved developed reserves was US$2,352 million.



Of the total amount of
proved undeveloped reserves that we had at the end of 2011 (610 million boe), we converted approximately 212 million boe, or 35%,
to proved developed reserves during 2012, which resulted mainly from (1) crude oil projects, primarily associated with the development
of heavy crude oil fields in Castilla, Rubiales, Chichimene and Quifa in the Central region, which represented approximately 59%
of the total conversion, and (2) availability of a new compression facilities for gas processing in the Chuchupa field, which represented
18% of the total conversion. The conversion of the remaining 23% was associated with development execution in other fields such
as the Casabe, Cira Infantas, Apiay fields, among others. The amount of investment made during 2012 to convert proved undeveloped
reserves to proved developed reserves was US$2,155 million.



Of the total amount of
proved undeveloped reserves that we had at the end of 2010 (517 million boe), we converted approximately 181 million boe, or 35%,
to proved developed reserves during 2011. This was mainly the result of (i) crude oil projects primarily associated with the development
of heavy crude oil in Rubiales, Castilla and Chichimene located in the Central region, which represented 58% of the total conversion
and (ii) new gas sales agreements in the Cupiagua Field and the availability of a new gas processing plant, which accounted for
11% of the total conversion. The conversion of the remaining 31% was associated with development execution in other fields, such
as Tibu and Cira Infantas, among others. The amount invested during 2011 to convert the proved undeveloped reserves to proved developed
reserves was US$2,328 million.



Present Activities



Ecopetrol America Inc.
placed the most competitive bids for 11 blocks in the “Central Planning Area Lease Sale 231” round held in New Orleans
on March 19, 2014, as disclosed by the Bureau of Ocean Energy Management (BOEM), the governmental authority in charge of the process
in the United States. In this lease sale, Ecopetrol America Inc. partnered with Murphy Exploration and Production-USA in 7 blocks
and with Murphy Exploration and Production-USA and Venari Offshore LLC in 4 blocks. The official awarding of the blocks will be
conducted by BOEM in the coming months after it checks the bids and ascertains that the companies fulfill the conditions required
for the round. The value of the bids placed by Ecopetrol America and its partners in the 11 blocks add up to approximately US$73.2
million with Ecopetrol America’s share consisting of approximately US$33.7 million. If granted, these blocks would allow
deep sea hydrocarbon exploration in water depths of over 221 meters for a 10-year period. Further, Ecopetrol America would increase
its participation in the U.S. Gulf Coast basin to 149 blocks. The results obtained strengthen Ecopetrol’s position in the
U.S. Gulf of Mexico, which it considers a focus area in its internationalization process.



As a result of drilling
in San Martin, Meta province (Colombia), in February 2014, Ecopetrol S.A. discovered the presence of hydrocarbons in the Tirbirita-1A
well. This discovery on the Caño Sur Western block, coupled with the Trasgo discovery in August of 2011, as well as other
finds in neighboring blocks CPO-10 and CPO-11, have helped strengthen Ecopetrol's position in the development of heavy crude in
this area of the country where last year the Caño Sur Este block was declared commercially viable. Ecopetrol S.A. will continue
the evaluation and scale activities of the Tibirita discovery, based on the results obtained from the exploratory drilling.



-51-







Contractual Arrangements with the
Government of Colombia for the Exploration and Production of Crude Oil and Natural Gas in Colombia



To address the country’s
exploration and production needs, Colombia has modified the contractual regime governing the exploration, development and production
of hydrocarbons on a number of occasions since its introduction in 1970. The exploration and production contracts entered into
with our business partners set forth the production split, the length of the exploration and production terms, and royalty payments.



Under Colombian law, an
existing contract cannot be modified because of a change to the contractual regime, unless the change is made through public order
regulations. As a result, contracts that were executed prior to the issuance of a new contractual regime remain in full force and
are not affected by the subsequent regime. As of December 31, 2013, we were party to one hundred and seven (107) agreements with
partners and twenty seven (27) exploration and production agreements (E&P’s and TEA’s) with the ANH in which we
do not have any partners.



Under joint venture contracts
entered into before March 1994, which include contracts regarding the Cusiana and Cupiagua crude oil fields, among others, the
private investor explored a previously agreed upon area at its own risk and expense. Thereafter, we had the option to become a
joint venture partner by reimbursing the investor 50% of the exploration costs of oil wells within commercially viable fields and
50% interest of all future development costs related to those fields. Once we became a partner, we had a 50% interest in the production
of the field. If we decided not to become a joint venture partner within a certain period of time, the private investor had the
right to enter into a sole risk contract for the field’s crude oil production until it had recovered 200% of its investment
and 100% of its total costs. Thereafter, we could participate in the development of the field and all future costs and expenses
would be automatically shared with our partner.



Beginning in 1994, modifications
were made to standard joint venture contracts to maintain the private investor’s share of production at 50% until aggregate
production exceeded 60 million barrels. Thereafter, our share increased gradually, up to a maximum of 70% of production. In 1995,
further modifications to the standard joint venture contracts required us to pay for half of the exploration costs, not only for
wells that ultimately proved to be productive, but also for dry wells, stratigraphic wells and seismic exploration in fields that
became commercially viable. The modifications also provided for competitive bidding for the right to explore and develop marginal
fields (defined according to certain technical, financial and operational criteria). In the bidding process, private companies
presented bids based on percentages of production they would pay us in exchange for the rights to develop these fields. Winning
bidders were responsible for all future investment and operating costs related to the field.



The standard joint venture
contract was once again modified in 1997 in order to promote private sector activity in the development of inactive areas and small
fields and in the exploration for natural gas. These modifications extended the exploration periods, increased the levels of reimbursement
for private companies’ exploration costs and provided for the reimbursement of exploration costs in real terms and denominated
in U.S. dollars.



In 1999, Colombia adopted
two additional modifications to the standard terms, applicable to new joint venture contracts:



| | · | Reduction of Our Initial Participation.Our initial participation under the joint venture contracts
signed after this reform was reduced from 50% for contracts signed before this reform to 30%. As of December 31, 2013, we had 37
joint venture contracts outstanding in which our participation was greater than or equal to 50%, and 16 joint venture agreements
where our participation was less than 50%.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Modified R Factor. The Government modified the formula used to determine the increase in our
share of total production, or the R Factor. The R Factor is calculated by dividing accumulated revenues in cash by investments
and costs. If the R Factor increases above a certain profitability threshold, then our share of production increases above the
initial 30%. Pursuant to the 1999 modifications, we raised the profitability threshold at which the R Factor triggers an increase
in our share from 1.0 to 1.5. Additionally, prior to the 1999 modifications, the R Factor was calculated in constant U.S. dollars.
The new calculation method was designed to prevent inflation from causing an increase in the R Factor and a corresponding increase
in our share.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-52-







In 2004, the authority
to enter into exploration and production contracts was assigned to the ANH and since then we have had to compete with all other
regional and international oil companies in Colombia for exploration and production opportunities pursuant to the same conditions
and without any special rights. Decree Law 1760 of 2003 gave us the option to retain or terminate contracts we had entered into
prior to January 1, 2004, and absolute discretion to extend such contracts after their stated termination date. If we decide not
to extend a contract, the production rights and assets related to the relevant block will revert to us and we would have the right,
at no additional cost, to exploit the associated reserves indefinitely. Contracts entered into by us after January 1, 2004 that
are not extended by the ANH will revert to the ANH and not to us.



In 2004, the ANH introduced
two new model contracts to replace the previously used joint venture contracts: the exploration and production contract and the
technical evaluation agreement.



| | · | Exploration and Production Contracts. Under exploration and production contracts the contractor,
such as us or another operator, assumes all exploration and production activities. The contractor also assumes all risks and costs
of exploration and is the sole owner of all production and assets involved in the exploration and production activities for the
term of the contract. There is no partnership or joint venture between the contractor and the ANH.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Technical Evaluation Agreements. The scope of technical evaluation agreements is limited to
exploration activities. Under this type of agreement, the contractor can evaluate a specific area and decide whether or not it
will enter into an exploration and production contract. The contractor assumes all risks and costs of the activities and operations.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



We have entered into several
agreements, or “Convenios,” with the ANH in areas directly operated by Ecopetrol S.A., where Ecopetrol S.A. holds total
exploration and production rights up to the point when revenue from the well falls below the costs of operations set by the company
(the “economic limit”).



When joint venture contracts
agreed before December 31, 2003 expire, Ecopetrol S.A. is required to enter into agreements with the ANH pursuant to Article 2
of Decree 2288 of 2004. The purpose of these agreements is to define the terms and conditions under which Ecopetrol S.A. can exercise
its exclusive right of exploration and production of hydrocarbons—granted by Decree Law 1760 of 2003—in the agreement
area until the economic limit of the area covered by the contract).



Joint venture and other contractual
arrangements with third parties



We have entered into a
number of joint venture and other contractual arrangements for exploration and production with regional and international oil companies
in connection with our own crude oil and natural gas exploration and production projects. These arrangements include: risk participation
contracts, incremental production agreements, shared risk production contracts, risk services production contracts and discovered
undeveloped fields contracts.



| | · | Risk-Participation Contracts.Under these contracts, we assume 20% of the exploration costs
and risks at the beginning of the second year in exchange for a larger participation in the future production and equal representation
on the executive committee of the joint venture. As of December 31, 2013, we had four risk participation contracts in effect.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Incremental Production Agreements. We currently have two types of incremental production agreements:
the standard incremental production agreements, or SIPAs, and the development of incremental production project agreements, or
DIPAs.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | SIPAs.Under SIPAs, we calculate the total number of proved developed reserves available in
a specific field or well and then establish a base production curve for the reserves. Any future production exceeding the curve,
which we refer to as incremental production, results from extracting proved undeveloped reserves or probable reserves which require
additional investments funded by our partners under the SIPA. We have the right to a previously specified percentage of the incremental
production. Our percentage participation varies depending on the total amount invested by our partners and on the R Factor, which
cannot be lower than 1.5. The volume produced under the production curve is not shared with our partners. As of December 31, 2013,
we had five SIPAs in effect.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-53-







| | · | DIPAs.Under DIPAs, we file a request with the Ministry of Mines and Energy for approval of
an incremental production project for a field that we directly operate. If the project is approved, we agree with our partners
to develop the field and we determine mandatory investment thresholds for our partners. We are not required to fund any investment.
The production from the field is distributed to us and our partners receive a percentage of the total production from the field
that varies depending on the invested amount. Once the mandatory investment stage expires, we agree with our partners on the percentage
of production, total costs and additional investments to be paid by each party. We pay 20% royalties to the Nation on the base
production curve and variable royalties on any incremental production. Additionally, in the event of higher prices and large volumes,
we have adjustment clauses to increase our share in the production. As of December 31, 2013, we had one DIPA in effect.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Shared-Risk Production Contracts.Under these contracts, we remain operators of the field and
assume responsibility for 50% of all investments and costs. Private oil companies submit bids to enter into agreements with us
based upon the production percentage they will assign to us. The successful bidder has the right to enter into the shared risk
contract with us. As of December 31, 2013, we had two shared risk production contracts outstanding.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Risk Service Production Contracts.We began using risk service production contracts in January
1998 to increase production through the use of new technologies in crude oil fields then operated by our partners. All investments
in new technologies were made by our partners who received a previously specified fee per barrel. As of December 31, 2013, we had
one risk service contract outstanding for the development of the Rancho Hermoso field located in the Mirador formation.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Discovered Undeveloped Fields Contracts.We have entered into discovered undeveloped fields
contracts to promote exploration by private companies of both undeveloped and inactive fields. Under these contracts, the contracting
party assumes all costs and expenses for the development and operation of a field in exchange for a certain amount of production.
As of December 31, 2013, we had nine discovered undeveloped fields contracts.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | As of December 31, 2013 we also had one Technical Alliance Agreement with a service company to
support the operation of Casabe field in which we maintain operations and ownership of 100% reserves.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | During 2013 the Service and Technical Cooperation Contract with the Universidad Industrial de Santander
(UIS) for research and development of the Colorado field, was terminated as provided under the contract.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Our joint venture contracts
with third parties include Sole Risk Operation options. If the parties to such ventures decide not to continue with an operation,
each party to the contract has the right to exercise the Sole Risk Operation option and take the sole risk and profit in the operation
for the crude oil production until it has recovered a specified percentage of its investment and of its total costs. Thereafter,
the parties that did not participate in the development of the field will share all the future costs and expenses as if such parties
had elected to become a joint venture partner in the agreement. As of December 31, 2013, we had 16 contracts where sole risk operations
are being carried out.



Management of Crude Oil and Natural Gas
Joint Ventures



Every crude oil and natural
gas joint venture has an executive committee that makes all technical, financial and operational decisions. All major decisions
must be made unanimously. Although we do not operate some of these joint ventures, we have an active role in the decision-making
process and development of the projects. As a result, we exert significant control over the development of joint ventures, even
for those joint ventures in which we have less than a majority economic interest.



-54-







Refining and Petrochemicals



Summary



Our main refineries are
the Barrancabermeja refinery, which we directly own and operate, and Reficar, a wholly owned subsidiary, which we also operate.
We also own and operate two other minor refineries — Orito and Apiay. Our refineries produce a full range of refined products,
including gasoline, diesel, jet fuel, liquefied petroleum gas (LPG), and heavy fuel oils, among others.



The following table sets
forth our daily average installed and actual refinery capacity for each of the last three years.



|                |  | For
    the year ended December 31, |        
|--------------- |  | ----------------------------------- | -------
|                |  | 2013                                |        
|                |  | Capacity                            |        
|                |  | (bpd)                               |        
|Barrancabermeja |  |                                     | 250,000
|Reficar         |  |                                     | 80,000 
|Apiay           |  |                                     | 2,500  
|Orito           |  |                                     | 2,500  
|Total           |  |                                     | 335,000



Barrancabermeja



At Barrancabermeja, we
produce a variety of fuels, such as regular and premium unleaded gasoline, diesel fuel, kerosene, jet fuel, aviation fuel, LPG,
fuel oil and sulfur. We also produce petrochemicals and industrial products, including paraffin waxes, lube base oils, low-density
polyethylene, aromatics, asphalts, alkylates, cyclohexane and aliphatic solvents, as well as refinery grade propylene. The Barrancabermeja
refinery supplies approximately 72% of the fuels consumed in Colombia.



The gross refining margin
increased from US$10.87 per barrel in 2012 to US$10.95 per barrel in 2013, mainly due to the lower cost of the mix of processed
crude, which is composed of a higher proportion of heavy crudes. The average conversion ratio for Barrancabermeja was 72.5% in
2013 and 76.5% in 2012. This decrease in conversion and in the throughput were due primarily to the heavier crude processed into
the refinery: 25.4° API gravity in 2013 vs. 27.6° in 2012.



We are currently evaluating
the potential implementation of a modernization process to convert Barrancabermeja into a deep-conversion refinery, which would
allow it to process more extra-heavy and heavy crudes produced at local fields and increase production of mid-distillates for the
local market. The modernized refinery would be expected to produce fuels of higher quality, which would help reduce pollution and
lead to better air quality in Colombia. This project, if undertaken, would be expected to be in operation by 2020. After the completion
of the Reficar project, described below, and, if undertaken, the Barrancabermeja project, we would expect to be able to supply
the entire Colombian market without the need for imports of refined products.



The following table sets
forth the production of refined products of Barrancabermeja for the years ended December 31, 2013, 2012 and 2011.



|                                                      |  | For the year ended December 31, |        
|----------------------------------------------------- |  | ------------------------------- | -------
|                                                      |  | 2013                            |        
|                                                      |  | (bpd)                           |        
|LPG, Propylene and Butane                             |  |                                 | 13,572 
|Gasoline Fuels and Naphtha                            |  |                                 | 67,592 
|Diesel                                                |  |                                 | 45,179 
|Jet Fuel and Kerosene                                 |  |                                 | 19,546 
|Fuel Oil                                              |  |                                 | 58,852 
|Lube Base Oils and Waxes                              |  |                                 | 1,468  
|Aromatics and Solvents                                |  |                                 | 2,632  
|Asphalts and Aromatic Tar                             |  |                                 | 6,174  
|Polyethylene, Sulfur and Sulfuric Acid                |  |                                 | 1,118  
|Total                                                 |  |                                 | 216,133
|Difference between Inventory of Intermediate Products |  |                                 | 538    
|Total Production                                      |  |                                 | 216,671










| | (1) | Amounts adjusted upwards based on updated measurements.
| | --- | -------------------------------------------------------



-55-







During 2013, we delivered
61.59 thousand bpd of low sulfur gasoline (less than 300 parts per million sulfur content) and 77.84 thousand bpd of low sulfur
diesel (less than 50 parts per million sulfur content) to meet existing fuel quality standards.



Reficar



As part of our Strategic
Plan, we expect to increase the competitiveness and profitability of Reficar through the modernization of its facilities and processes,
and the improvement of its reliability. The project is approximately 90% complete. We currently expect to complete the modernization
process and resume operations during the first half of 2015. Once complete, the refinery’s nominal production capacity is
expected to be 165 thousand bpd. We expect to improve refining margins by processing lower cost heavy crude oils, raising the conversion
ratio, and producing a higher quality slate of products. We also expect to reduce the sulfur content in gasoline and diesel fuel,
thus complying with current national and international fuel standards without the need to blend imported Ultra Low Sulfur Diesel.



On December 30, 2011,
with approval from the Ministry of Finance, Reficar executed the project finance agreements for the expansion and modernization
of the Reficar refinery in the amount of US$3.5 billion with a repayment term of 14 years. See “Item 5. Operating and Financial
Review and Prospects—Liquidity and Capital Resources.” As of December 2013, Reficar had drawn US$3.3 billion under
these financial agreements.



During 2013, under the
Construction Support Agreement Reficar requested an additional US$1 billion for the project, which was funded as follows: (1) US$750
million from a share capitalization process and (2) US$252 million from a subordinated loan from an Ecopetrol affiliate.



In 2014, under the Construction
Support Agreement, Reficar has requested US$1.35 billion as part of the total project cost, which is currently estimated at US$6.5
billion. The requested amount for 2014 is being contributed by means of a capital injection and by a subordinated loan from an
Ecopetrol affiliate. Any increase in the project’s capital expenditures is expected to be funded under the Construction Support
Agreement between Reficar and Ecopetrol S.A.



As the Project continues
in the construction phase, Reficar has requested US$249 million against the Debt Service Guarantee Agreement. The purpose is to
cover the first and second debt service payments due to third party lenders under the project finance on June and in December 2014.
It is expected that this amount will be contributed by means of a subordinated loan to be granted by an Ecopetrol affiliate.



The following table sets
forth the production of refined products of Reficar for the years ended December 31, 2013, 2012 and 2011.



-56-







|                                                      |  | For the year ended December 31,(1) |       
|----------------------------------------------------- |  | ---------------------------------- | ------
|                                                      |  | 2013                               |       
|                                                      |  | (bpd)                              |       
|LPG, Propylene and Butane                             |  |                                    | 3,264 
|Motor Fuels                                           |  |                                    | 19,679
|Diesel                                                |  |                                    | 15,669
|Jet Fuel and Kerosene                                 |  |                                    | 6,090 
|Fuel Oil                                              |  |                                    | 15,468
|Aromatic Tar                                          |  |                                    | 691   
|Other Products                                        |  |                                    | 27    
|Total                                                 |  |                                    | 60,888
|Difference between Inventory of Intermediate Products |  |                                    | 6,613 
|Total Production                                      |  |                                    | 67,502








| | (1) | The table shows the entire production of Reficar.
| | --- | -------------------------------------------------



During 2013, Reficar’s
production decreased to 67.5 thousand bpd, from 75.2 thousand bpd in 2012, primarily due to a cracking unit shutdown in September
2013, followed by a shutdown of the visbraker unit in October 2013. The cracking unit shutdown was necessary in order to move forward
with the expansion project requirements, as this unit will continue operating under the new refinery structure. The visbraker shutdown
occurred as a result of the cracking unit shutdown, because the visbraker provides products to the cracker unit. The refinery was
shut down completely in March 2014 to permit completion of the expansion project and will remain shut down for the rest of 2014.
Reficar is currently evaluating the viability of integrating these assets along with the new refinery.



The average conversion
ratio for Reficar during 2013 was 67.31%. The gross refining margin decreased from US$5.36 per barrel in 2012, to US$3.06 per barrel
in 2013, mainly due to higher costs of refined products such as gasoline, diesel and jet fuel, mainly because of the cracking and
visbraker shutdowns.



In 2011 we started to
purchase low-sulfur gasoline and continued purchasing low-sulfur diesel and biodiesel to improve the quality of the diesel and
gasoline produced at Reficar. Reficar is currently purchasing biodiesel in the local market and mixing it with its production of
diesel to reduce sulfur content to meet local specifications. We expect to terminate these purchases once the modernization process
is completed.



Contracts with other members of
the Corporate Group



In December 2011, Ecopetrol
S.A. entered into a construction support agreement and a debt service guarantee agreement to guarantee certain obligations of Reficar
under the US$3.5 billion project finance for the expansion and modernization of its facilities. Pursuant to the terms of the construction
support agreement, Ecopetrol S.A. agreed to support Reficar’s costs and expenses related to cost overruns and delays in construction.
Pursuant to the terms of the debt service guarantee agreement, Ecopetrol S.A. provided Reficar with a liquidity mechanism to pay
its debt service shortfalls and a mechanism to exit the project financing by transferring its debt to Ecopetrol S.A. See “Item
5. Operating and Financial Review and Prospects—Liquidity and Capital Resources.”



Petrochemicals and Other Products



We own and operate four
petrochemical plants and one paraffin and lube plant located within Barrancabermeja, producing a variety of products, including
aromatics, cyclohexane, paraffin waxes, lube base oils, polyethylene and solvents. In 2013, we produced 35,184 tons per year of
low-density polyethylene and 659.7 thousand barrels of aromatics (benzene, toluene, xylene, orthoxylene, heavy aromatics and cyclohexane),
a 4.6% and 14% decrease compared with a production of 36,882 tons of low-density polyethylene and 774.5 thousand barrels of aromatics
in 2012, respectively. This decrease was due primarily to heavier crude feed to the refinery, as was mentioned above. Typically,
heavier crudes produce less feed material and, as a consequence, less products in the petrochemical and paraffin units.



-57-







Propilco



During 2013, Propilco’s
production totaled 396 thousand tons of petrochemical products, a 3% decrease compared to the 409 thousand tons produced in 2012.
The contribution margin in 2013 was 26% lower than in 2012, a decrease from US$287 per ton in 2012 to US$212 per ton in 2013. The
decrease in production and in contribution margin was primarily due to higher raw material costs associated with higher quantities
of polypropylene imports and the importation of 42,000 tons of propylene-grade polymer (PGP) that Ecopetrol could not deliver due
to operating problems. The following table sets forth Propilco’s average capacity and throughput for each of the last three
years.



Furthermore, the company’s
performance was challenged by shifts in the petrochemical markets, as a result of new shale gas discoveries in the US and
low costs products coming from Asia. In 2013, Ecopetrol performed an impairment test on its investments’ goodwill, resulting
in a deterioration in Propilco’s investment of Ps$280.4 billion.



|                 |  | For the year ended December 31,(1) |        
|---------------- |  | ---------------------------------- | -------
|                 |  | 2013                               |        
|                 |  | (Metric Tons)                      |        
|Average capacity |  |                                    | 475,000
|Throughput       |  |                                    | 395,869
|% Use            |  |                                    | 83     








| | (1) | The current figures were revised from the 2012 20-F version in order to reflect the same information
that is published on the financial reports of the company, which only includes the polypropylene that was produced, packed and
stored.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Import of Ultra-Low Sulfur Diesel



We are reducing sulfur
emissions of fuels produced at our refineries and importing ultra-low sulfur diesel. Since January 2013, we supply diesel with
sulfur levels under 50 ppm (parts per million) in Colombia. In 2013 we increased imports of ultra-low sulfur diesel by 15.1 thousand
bpd as compared to 2012 due to rising local demand, according to the quality standards of sulfur content effective in 2013.



Marketing and Supply of Refined
Products



We market a full range
of refined and feed-stock products locally including regular and high octane gasoline, diesel fuel, jet fuel, natural gas and petrochemical
products, among others. Local sales of regular gasoline, LPG, jet fuel and diesel fuel are subject to government price regulation
with reference to international benchmarks. We are the main producer and supplier of refined products in Colombia. For regulated
products, the Ministry of Mines and Energy establishes maximum prices producers can charge and retail prices for these products
pursuant to resolutions. The Ministry also establishes maximum wholesale and retail margins. For LPG, the Energy and Gas Regulatory
Commission establishes maximum prices as well as wholesale and retail margins.



Transportation and Logistics



Summary



Cenit



In 2012, we incorporated
Cenit as a wholly owned subsidiary specializing in logistics and transportation of hydrocarbons within Colombia. Cenit aims to
enhance the strategic and logistical framework of Colombia’s oil industry in response to the increase in hydrocarbon production
and higher sales of crudes and refined products, both within Colombia and in international markets. Furthermore, it aims to strengthen
and expand the transportation network while maintaining high standards of industrial safety and reliability, as well as contributing
to environmental preservation.



-58-







Cenit is currently developing
its transportation infrastructure in order to meet the increased transportation needs of its current and potential customers in
Colombia, which may result from new discoveries or an increase in oil production.



Cenit represents a clear
separation of Ecopetrol’s roles as owner, planner, operator and user of transportation systems. Cenit operates with an open
model, in which all interested parties have the opportunity of accessing its transportation infrastructure. On the other hand,
we have also ensured that Cenit will provide the capacity to meet the transportation needs of our customers.



This new hydrocarbon transportation
framework is expected to produce significant advantages to Ecopetrol S.A. It allows Ecopetrol S.A. to focus on its strategic business
segments while Cenit can take the lead in finding and exploiting profitable transportation and logistics opportunities.



Cenit’s authorized
and outstanding capital is Ps$1.3 billion and Ps$10 million, respectively. In October 2012, Ecopetrol transferred the direct interests
in Ocensa, ODC, Oleoducto Bicentenario, ODL and Serviport to Cenit. On April 1, 2013, Ecopetrol completed the transfer of hydrocarbon
transport and logistics assets to Cenit.



Ecopetrol S.A. entered
into a transportation agreement with Cenit, pursuant to which Cenit will provide hydrocarbon transportation and logistics services
through the transportation assets transferred to it as an in-kind capitalization. Ecopetrol S.A. also entered into an operation
and maintenance agreement with Cenit pursuant to which Ecopetrol S.A. will be in charge of the operation and maintenance of the
transportation assets. In return, Cenit will pay Ecopetrol S.A. a variable monthly payment for the services rendered. On April
1, 2013, Cenit started its operations as owner of the transportation and logistics infrastructure. Cenit’s responsibilities
will focus on commercial management, system planning and development, new businesses, and third-party liability. The main pillars
on which Cenit will rely to achieve infrastructure growth will be the alignment of interests and objectives, the utilization of
proactive response, and implementation of the country’s vision. See “Item 4. Information on the Company—Transportation
and Logistics— Contracts with Ecopetrol S.A.”



The transportation and
logistics segment includes the transportation of crude oil, motor fuels, fuel oil and other refined products including diesel and
biofuels.



As of December 31, 2013,
we, directly or indirectly with private sector participants, owned, operated and maintained an extensive network of crude oil and
refined products pipelines connecting our own and third-party production centers and terminals to refineries, major distribution
points and export facilities. Cenit directly owns 36% of the total crude oil pipeline shipping capacity, and 99% of the total product
pipeline shipping capacity in Colombia. When aggregated with the crude oil pipelines in which Cenit owns an interest, Cenit owns
79% of the oil pipeline shipping capacity in Colombia. By December 31, 2013, our network of crude oil and multi-purpose pipelines
was approximately 6,746 kilometers in length. The transportation network we own directly, in partnership with other companies,
and in joint venture partnerships, consists of approximately 4,857 kilometers of main crude oil pipeline networks connecting various
fields to the Barrancabermeja refinery and Reficar, as well as to export facilities. We directly own 3,029 kilometers of crude
oil pipeline and an additional 1,828 kilometers of crude oil pipeline with our business partners. We also own 3,717 kilometers
of multi-purpose pipelines for transportation of refined products from the Barrancabermeja refinery and from Reficar to wholesale
distribution points.



The map below shows the
main transportation networks owned by our business partners and us.



-59-







Transportation
Infrastructure







-60-







Organizational Restructuring



Vice-Presidency of Transportation
and Logistics



After the creation of
Cenit and the transfer of the transportation assets to it during 2013, the Vice-Presidency of Transportation and Logistics consolidated
its strategy, which is focused on strengthening our operations and maintenance services, comprehensive logistics solutions and
risk management, in order to ensure customer satisfaction while adding value.



The Vice-Presidency now
comprises four main areas: Operations and Maintenance, Comprehensive Transportation and Logistics Solutions, Asset Management,
and Commercial and Customer Service. The Integrity and Contingency programs were integrated into the Asset Management and Operations
and Maintenance offices, respectively. All four of these areas aim to accomplish their obligations to their customers: Cenit, ODL,
ODC, Ocensa and Oleoducto Bicentenario de Colombia.





The Vice-Presidency assures the processes
related to maintain the integrity of the infrastructure in order to improve our operational risk model for transportation infrastructure
with respect to weather conditions and damage caused by third parties and the deployment of new technologies to monitor transportation
infrastructure and its environment, as well as the intervention of the infrastructure in areas susceptible to incidents that could
have severe consequences. In 2013, we spent Ps$218 billion on the integrity activities, a 52% increase from 2012, primarily due
to the execution of activities addressed to decrease the valuation of the levels in our operational risk model from very high and
high risk infrastructure to medium and low risk.



During 2013, we met our
customer satisfaction index goal, and we maintained our ISO 9001:2008, ISO 14001 and OHSAS 18001 certifications for all of our
transportation processes. We also attained the certification by the Oil Companies International Marine Forum (OCIMF), which provides
standards for hydrocarbons reception, storage, dispatch by pipes and pipelines and the import and export facilities of our docks.



Pipelines



In 2013, pipelines in
which we own an interest transported a total of 954 thousand bpd of crude oil and 237 bpd of refined products for a total of 1.19
million bpd in 2013. The transportation of crude oil increased mainly because Oleoducto de Colombia (ODC) increased its capacity
by 20 thousand bpd and achieved its volumetric goal of 230 thousand bpd, and because Ocensa Segment 3 exceeded its target capacity,
reaching a capacity of 410 thousand bpd. In 2012, pipelines transported a total of 1.22 million bpd of crude oil and refined products
compared with 1.20 million bpd in 2011. For 2013 we do not include the refinery charge and pipeline Pozos Colorados when compared
to 2012 and 2011. The following table sets forth our main pipelines in which we own an interest as of December 31, 2013.



|Pipeline                                 |  | Kilometers |       |  | Capacity
    Thousand bpd |  |     | Product
    Transported |  | Origin    |  | Destination     |  |  | Ownership
    Percentage                                   | 
|---------------------------------------- |  | ---------- | ----- |  | ------------------------- |  | --- | ----------------------- |  | --------- |  | --------------- |  |  | ---------------------------------------------------------- | 
|Caño Limón-Coveñas                       |  |            | 770.6 |  |                           |  | 220 |                         |  | Crude Oil |  | Caño Limón      |  |  | Coveñas                                                    | 
|Oleoducto del Alto Magdalena (OAM)       |  |            | 396.5 |  |                           |  | 110 |                         |  | Crude Oil |  | Tenay           |  |  | Vasconia                                                   | 
|Oleoducto de Colombia (ODC)              |  |            | 480.8 |  |                           |  | 240 |                         |  | Crude Oil |  | Vasconia        |  |  | Coveñas                                                    | 
|Oleoducto Central (Ocensa)               |  |            | 834.5 |  |                           |  | 590 |                         |  | Crude Oil |  | Cupiagua        |  |  | Coveñas                                                    | 
|Oleoducto Transandino                    |  |            | 306.9 |  |                           |  | 85  |                         |  | Crude Oil |  | Southern fields |  |  | Tumaco
                                         Port       | 
|Oleoducto de los Llanos (ODL)            |  |            | 262.0 |  |                           |  | 340 |                         |  | Crude Oil |  | East fields     |  |  | Monterrey
                                         Cusiana | 
|Oleoducto Bicentenario de Colombia S.A.S |  |            | 230.0 |  |                           |  | 110 | (1)                     |  | Crude Oil |  | Araguaney       |  |  | Banadia                                                    | 










| | (1) | Represents the crude oil transportation capacity for the project currently in operation.
| | --- | ----------------------------------------------------------------------------------------



Oleoducto Bicentenario
is finalizing the construction of the pipeline and its related pumping facilities connecting the Araguaney and Banadía locations;
however, some pending minor activities are scheduled to be carried out during 2014. The estimated total investment of US$2,035
million was financed by equity injections from the shareholders amounting to 30% of the total cash requirements and the remaining
70% through a syndicated local loan for Ps$2.1 trillion (approximately US$1.09 billion) which was disbursed during 2012 and 2013.



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The first phase of the
construction is expected to allow the transportation of at least 110 thousand bpd, through a pipeline of 230 kilometers in length
and a diameter of 42 inches, connecting the Araguaney and Banadía stations. Delays in the completion of the first phase
of this project were due in part to events such as lockouts from communities in the areas of project construction demanding more
social investment from the government, security issues, attacks by guerrilla groups, and unfavorable weather conditions. As a result,
the construction process was impacted and prevented us from transporting crude oil through this pipeline until November 2013. During
2013, we completed the construction of 88.77% of the first phase and expect to complete this phase during first half of 2014.



In addition to the construction
of the first phase of the Araguaney-Banadía pipeline, the process of enhancing and revamping the Araguaney and Banadía
stations reached 81.12% and 72.25% of completion by 2013 year-end, respectively. The Coveñas port storage facilities project
reached 85.98% of completion. The Coveñas storages facilities are expected to start operations in the first quarter of 2014.
The next phases of the Oleoducto Bicentenario are awaiting internal approvals from shareholders. The studies aimed at obtaining
environmental licenses from governmental authorities are underway.



The table below sets forth
the volumes of crude oil and refined products transported through the crude oil pipelines and multipurpose pipelines owned by us.



|                              |  | For the year ended December 31, |        
|----------------------------- |  | ------------------------------- | -------
|                              |  | 2013(3)                         |        
|                              |  | (thousand bpd)                  |        
|Crude oil transport(1)        |  |                                 | 954.0  
|Refined products transport(2) |  |                                 | 237.2  
|Total                         |  |                                 | 1,191,2



| | (1) | The pipelines transporting crude oil for Cenit in 2013 include the following: Ocensa Segment 3,
ODC, Vasconia-Galan L20”, Ayacucho-Galan L8”, Ayacucho-Coveñas L16”, Ayacucho-Coveñas L24”,
Trasandino Pipeline. Not included among this list is the Refinery charge.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | The pipelines transporting refined products include the following: Galan-Sebastopol L12”
and 16”, Galan-Salgar L8”, Galan-Bucaramanga, Buenaventura-Yumbo and Cartagena-Baranoa. The figures do not include
Pozos Colorados-Galan.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



As of December 31, 2013,
we owned 57 stations, 24 of them located in crude oil pipelines, 25 of them in refined products pipelines, six supply plants and
two in the ports and riversides (not including those associated with the transportation network that belong to third parties and
are operated by us). In addition, we have a nominal storage capacity associated with the transportation network of 19 million barrels
of crude oil and 6 million barrels of refined products. We also sell storage capacity to third parties in our Pozos Colorados and
Mansilla facilities and in the Coveñas port. We do not own any tankers.



Theft of Hydrocarbons



In 2013, we continued
to work towards reducing thefts of hydrocarbons. Theft of refined products, which reached a peak of 7,270 bpd in 2002, was reduced
to 23.1 bpd in 2013 from 27 bdp in 2012, a decrease of 14%, mainly due to the efforts in the detection of illicit valves, the development
of technology and cooperation with the Colombian Army and law enforcement agencies. The theft of crude oil increased from 413 bpd
in 2012 to 541 bpd in 2013, mainly due to the security situation in southern Colombia due to and the presence of illegal groups
that impede interdiction.



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Terrorism



Terrorist acts by guerrillas
increased during 2013, including 225 attacks against pipeline infrastructure in Colombia, which is a 49% increase when compared
with 2012. These terrorist attacks resulted in interruptions and slowdowns in our transport system and different production facilities.
The most significant impacts occurred in the operation of six of our pipelines: Oleoducto Caño Limón - Coveñas,
Oleoducto Bicentenario, Oleoducto Transandino, Oleoducto San Miguel - Orito, Oleoducto Churuyaco - Orito, Oleoducto Mansoya - Orito.
The affected areas by those attacks were: Arauca, Norte de Santander, Putumayo, and Nariño. In addition, these attacks affected
the production fields in Putumayo and Caño Limón Coveñas, where the operation was restricted. The direct cost
of repairs to our pipeline infrastructure due to terrorist attacks in 2013 was approximately Ps$60.2 billion (approximately US$32
million)



Other Transportation Facilities



We have entered into transportation
agreements with tanker-truck and barge companies in order to transport crude oil from locations that do not have pipeline connections
to refineries and export facilities. The volume of refined products that cannot be transported in pipelines or in tanker trucks
because of capacity limitation is transported by barges. During 2013, 37.2 million barrels of crude oil and refined products were
transported by tanker trucks and 6.9 million barrels of crude oil and refined products were transported by barges.



Export and Import Facilities



We currently have concessions
granted by the Nation for four export docks for crude oil and refined products: Colorados, Coveñas, Tumaco and Buenaventura.
Our export capacity reached 1,456 million bpd for crude oil and 1,027 million bpd for refined products. Our import capacity reached
1,223 million bpd.



Our crude oil loading
facilities can load tankers of up to 350 thousand deadweight tonnage, or DWT. Adjacent to these loading facilities we also have
crude oil storage facilities that are capable of storing 7.5 million barrels. Our docks used for import and export of refined products
can load tankers of 85 thousand DWT up to 350,000 DWT. Additionally, these facilities have storage capacity of up to 1.2 million
barrels.



New Transportation Projects



Projects to Increase Transportation
Capacity



During 2013, we increased
capacity in our primary and secondary oil pipelines, loading facilities due to several projects carried out by Cenit and its subsidiaries.



The nominal capacity of
the main systems increased as follows: our main oil pipeline systems increased from 1,200 thousand bpd in 2012 to 1,306 thousand
bpd in 2013.



Main Accomplishments During 2013



Primary Oil Pipeline
Network:



| | · | Increase of 40 thousand bdp in the nominal capacity of the Vasconia-GRB-Galan system, from 180 to
220 thousand bpd.
| | - | -------------------------------------------------------------------------------------------------------------------



| | · | Increase of 25 thousand bpd in the nominal capacity of the Transandino Oil Pipeline, from 60 to 85
thousand bpd.
| | - | ----------------------------------------------------------------------------------------------------------------



| | · | Increase from 340 to 405 thousand bpd in the nominal capacity of Ocensa Segment 3 pipeline.
| | - | -------------------------------------------------------------------------------------------



| | · | Optimization of Caño Limón-Coveñas oil pipeline capacity from 200 to 220 thousand
bpd.
| | - | --------------------------------------------------------------------------------------



Secondary Oil Pipelines:



| | · | Commencement of operations at Oleoducto Bicentenario de Colombia pipeline with 110 thousand bpd.
| | - | ------------------------------------------------------------------------------------------------



| | · | Increase of capacity from 240 thousand bpd to 280 thousand bpd in the Apiay-Monterrey System.
| | - | ---------------------------------------------------------------------------------------------



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| | · | Increase of capacity in Castilla-Apiay from 180 thousand bpd to 190 thousand bpd.
| | - | ---------------------------------------------------------------------------------



| | · | Completion of the bi-directionality of the Monterrey-Araguaney oil pipeline with a capacity of 53
thousand bpd.
| | - | ---------------------------------------------------------------------------------------------------------------



Loading Facilities:



| | · | Fourth loading arm in Castilla loading bay, increasing its capacity by 8 thousand bpd to 30 thousand
bdp.
| | - | ---------------------------------------------------------------------------------------------------------



New Business Developments



During the first year
of Cenit’s creation as a new company and working under a common carrier scheme, Cenit, directly or through its subsidiaries,
has been working to meet the growing needs in transport and logistics within the hydrocarbon oil business in Colombia.



According to this strategic
goal, in 2013 Cenit signed (i) a cooperation agreement to participate with other companies in the Oleoducto al Pacífico
SAS to advance in the environmental process for a future potential pipeline to the Colombian Pacific Coast, (ii) a bilateral agreement
with Ecuador’s National Oil Company, Petroecuador, and Colombian southern oil producers companies for the connection to facilitate
national crude export from the Putumayo basin through an Ecuadorian port, and sanctioned an expansion of Vasconia downloading trucking
facilities to increase the entrance capacity of crude oil to Ocensa.



The strategic goal was
also pursued by the business development efforts of Cenit’s subsidiaries, particularly with market launch of Ocensa’s
expansion of the pipeline to increase capacity by 135 thousand bpd and the start of operations of the Bicentenario pipeline.



Contracts with Ecopetrol S.A.



| | · | On October 1, 2012, Ecopetrol S.A. entered into an Asset Contribution Agreement, establishing the
terms and conditions under which Ecopetrol S.A. contributed to Cenit its shares in companies engaged in oil transport, and on April
1, 2013, under this agreement, Ecopetrol S.A. contributed to Cenit its assets for the transportation of hydrocarbons and derivatives.
On April 1, 2013, Ecopetrol S.A. entered into the following agreements with Cenit:
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Projects and Transport Logistic Solutions Service Agreement, under which Ecopetrol S.A. will provide
management services on market terms to Cenit for a term of 15 years.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Operation and Maintenance Agreement for the operation, maintenance, emergency and disaster risk management,
among other services, which Ecopetrol S.A. will provide on market terms for a term of 15 years.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Service Agreement for the provision of comprehensive services on market terms by Cenit to Ecopetrol
S.A. for the transport, storage loading and unloading of hydrocarbons for a term of 30 years.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Service Agreement for the provision of comprehensive services on market terms by Cenit to Ecopetrol
S.A. for the transport, storage loading and unloading of refined products for a term of 30 years.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Incidents at Transportation Facilities



Salgar-Cartago Multipurpose Pipeline
Spill



On December 23, 2011 our
Salgar-Cartago pipeline ruptured. Internal and external experts believe this incident occurred as a result of creep movement caused
by severe weather conditions in the area, causing the surrounding soil to exert strong pressure on the pipeline and rupturing it.
Due to the rupture, approximately 59,976 U.S. gallons of gasoline spilled into the surrounding area in La Divisa and Villa Carola
in the Municipality of Dosquebradas, Risaralda. The spilled gasoline from the pipeline subsequently came into contact with a heat
source which ignited it, causing several explosions that tragically resulted in 33 fatalities and 35 injuries, as well as damage
to the neighboring houses and buildings.



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Colombia’s National
Authority on Environmental Licensing (ANLA) started conducting an investigation in connection with this incident, and CARDER (Risaralda’s
Region Environmental Autonomous Public Office), as a public authority with residual jurisdiction, commenced inquiries into Ecopetrol’s
fulfillment of its obligations regarding forest conservation and subterranean-waters and soils monitoring.



We performed our own internal
investigation of the incident, and hired a local engineering firm as well as a highly renowned international consultant to investigate
the causes of the incident. Our internal investigation, the investigation conducted by the Colombian engineering firm and the one
conducted by the international consultant concurred that the origin of the rupture of the pipeline was the result of a creep movement
caused by severe weather conditions in the area, causing the surrounding soil to exert strong pressure on the pipeline.



Notwithstanding that the
causes of such incident cannot be attributed to Ecopetrol, based on objective responsibility criteria established by Colombian
Law, and based on principles of solidarity and social responsibility, during 2012 and 2013, Ecopetrol agreed to compensate the
affected families for their injuries and losses. This compensation does not imply the admission to any guilt as to the incident
or the damages caused. For these purposes, Ecopetrol and the affected families agreed on the out-of-court settlement of the damages
and executed conciliation contracts, which were further reviewed and approved by judges in the city of Pereira. Settlements with
97% of the victims cover all injuries and losses for an approximate aggregate amount of Ps$22 billion.



Furthermore, during 2012
and 2013, Ecopetrol developed several social programs agreed with, and for the benefit of, the affected communities. These programs
have represented as of December 31, 2013 contributions of approximately Ps$20 billion to assist those affected by the incident
and to restore the environment and social infrastructure.



As of January 4, 2012,
we had cleaned the affected water bodies and completed the majority of our remediation activities in connection with the spill.
In addition, as of December 31, 2013, we had planted 3,900 trees in the Aguazul Creek basin, in accordance with the guidelines
provided by CARDER.



In January 2012, we launched
the Dosquebradas Project, and throughout 2013, we have made progress in the execution of its various components, as follows:



| | · | Health: 76% of cases involving people injured in the Dosquebradas incident were satisfactorily
closed. Once costs related to patients’ medical care in the future were settled and paid, such patients became registered
in the Public General Health System. In compliance with recommendations issued by ICBF (Colombian Family Welfare Institute), we
signed an agreement with legal representatives for the eight (8) male and female children affected in the incident, with the purpose
of placing Ecopetrol in charge of their medical care service. Such service is only to cover those diseases related to the aforementioned
incident.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Legal: The scheme of out-of-court settlements with the affected families, covering the passing
of their relatives as well as injuries sustained and loss of material assets was completed, for an approximate total amount of
Ps$26 billion. From such settlement agreements, nearly 535 people became benefited, and a final settlement was reached with 97%
of the victims.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Environmental: Those zones affected by the abovementioned fuel leak, in terms of surface and
subterranean waters, are currently recovered; the preview result of the last technical monitoring showed a 100% mending of subterranean
waters and 97% on soils.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Social: We carried out a wide range of activities involving the local community throughout
2013, thus promoting social development in this region, as well as the stabilization of the social tissue of a community affected
by the 2011 event. Investments related thereto amounted to approximately Ps$7.225 billion.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Caño Limón-Coveñas
Crude Oil Pipeline Spill





Due to natural causes and as a result of
unusual movement of soil and the tensioning of the pipeline, resulting from severe weather conditions, on December 11, 2011, the
Caño Limón-Coveñas oil pipeline ruptured and caused the spill of approximately 3,267 barrels of crude oil
into the Iscala creek, which connects with the Pamplonita River that provides water to the city of Cúcuta. The incident
did not cause any fatalities or injuries.



We launched our own internal
investigation and hired a highly renowned international consultant to investigate the causes of this incident. The conclusions
of the investigations support that the rupture occurred as a result of an unusual movement of soil and the tensioning of the pipeline.
We believe investigations will continue for the foreseeable future, and we cannot provide any indication as to their outcome, including
whether we will be found liable or subject to enforcement actions. This incident has been subject to investigations by the relevant
authorities.





A class action lawsuit has been filed against
Ecopetrol and against employees of the company. In 2013 there were no developments in the probatory stage of this lawsuit because
Administrative Judges in Cúcuta had to spend a considerable amount of time studying the impediment invoked that could eventually
prevent them from adjudicating this lawsuit, since a conflict of interest could arise. An official decision on the aforesaid impediment
was finally issued on December 5th, 2013 by the Administrative Tribunal in Cúcuta, ruling off the proposed impediment and
thus vesting the First Administrative Court of Cucuta with jurisdiction to conduct the case.



The Regional Environmental
Authority of Norte de Santander, or Corporación Autónoma Regional de la Frontera Nororiental – CORPONOR,
initiated an investigation into the causes of the incident and also initiated enforcement actions against us for the allegedly
wrongful implementation of the contingency plan. As of January 14, 2012, such proceedings were suspended due to the initiation
of a conflict of jurisdiction proceeding by the National Authority on Environmental Licensing – ANLA.



In December 2013, CORPONOR
issued an administrative act to initiate the probatory stage of the case. Nonetheless, this procedure was suspended upon the request
of the Environment Ministry, which is currently in charge of determining which public authority is competent to carry out these
proceedings.



The Colombian General
Comptroller’s Office initiated an investigation to determine whether Ecopetrol’s President, the Vice-president of Transportation,
and two other employees of the company should be held financially liable for the Caño Limón-Coveñas pipeline
spill and consequently for having caused a decrease in the assets of Ecopetrol. The advisors to the employees of Ecopetrol representing
them in front of the Colombian General Comptroller’s Office are optimistic regarding the final results of the proceedings;
in their opinion, the worst case scenario entails such employees being held civilly liable and the termination of their labor contracts.
No developments occurred in this investigation in 2013, as the expected first hearing remains suspended.



As of the date of this
annual report, no judgment or sanction against Ecopetrol or any of its employees has been issued. The different lawsuits and proceedings
are being handled by in-house lawyers and by the employees’ counselors.





The legal counselors are optimistic as to
the possible results of the proceedings, particularly due to the fact that there is technical evidence that the causes of the incident
are not attributable to Ecopetrol and that Ecopetrol timely responded to the incident in an efficient manner.





At the time of the incident,
the pipeline was not in operation. We activated the corresponding contingency plan and called for the support of the CREPAD, which
is the regional committee for attention and prevention of disasters. Five hundred workers were assigned to the decontamination
of the Iscala creek and the Pamplonita River. In addition, the authorities decided to close Cúcuta’s aqueduct gates
as a preventive measure, while certified laboratories performed tests to determine its water quality.



-66-









Ecopetrol and national and local authorities
are developing a project that Ecopetrol has lead for the development of an alternative to the water supply in the intake of the
aqueduct in Cúcuta, which project was approved by the Company’s Board of Directors in December 2011 as part of the
strengthening of the contingency plans and the relationship with its stakeholders. In order to meet this commitment, after basic
engineering studies performed during 2012, Ecopetrol set aside a provision of Ps$189 billion. As of December 31, 2013 the provision
was updated to Ps$194.4 billion.



In addition to those amounts
paid by Ecopetrol in 2012 (Ps$9.2 billion) for the decontamination of the Iscala creek and Pamplonita river and additional remediation
activities, we paid Ps$1.3 billion in 2013.



Given the uncertainty
of the outcome of current investigations and of potential future claims regarding these two incidents, we recorded in our financial
statements a provision for future payments and disbursements as if we had been found liable for all damages caused by the incidents.
Nevertheless, this provision is only a reasonable estimate of the costs related to the incident and not a definitive amount. We
will continue to review the amount of any necessary accruals, potential asset impairments, or other related expenses and will record
the charges in the period in which the determination is made and an adjustment is required.



Regulation



The main authorities that
regulate our activities in Colombia are: the Ministry of Mines and Energy, the National Hydrocarbons Agency (ANH), the Energy and
Gas Regulatory Commission (CREG), the Ministry of Environment and Sustainable Development, and the National Authority on Environmental
Licensing (ANLA).



Ministry of Mines and Energy



The Ministry of Mines
and Energy is responsible for managing and regulating Colombia’s non-renewable natural resources, ensuring their optimal
use by defining and adopting national policies regarding exploration, production, transportation, refining, distribution and export
of minerals and hydrocarbons.



Decree 714 of 2012 established that certain
functions previously held by the Ministry of Mines and Energy would be reassigned to the ANH. Among such functions we could cite
the following: establishment of procedures for the liquidation of royalties for hydrocarbons, giving assistance to the Ministry
of Mines and Energy on preparing governmental policies regarding hydrocarbons and sectorial plans, and the fulfillment of the relevant
goals.



National Hydrocarbons Agency – ANH



The ANH was created in 2003 and is responsible
for the administration of Colombia’s hydrocarbon reserves. The ANH’s purpose is to manage the hydrocarbon reserves
owned by the Nation through the design, promotion and negotiation of the exploration and production agreements in areas where
hydrocarbons may be found that are not subject to joint ventures executed before December 31, 2003 and still in force, that are
directly operated by Ecopetrol. The ANH is also responsible for creating and maintaining attractive conditions for investments
in the hydrocarbon sector and for designing bidding rounds for exploration blocks. Furthermore, the ANH is responsible for managing
all the royalties paid by oil and gas producers in Colombia. Decree 4137 of 2011 changed ANH’s legal nature and defined
new functions for it. Additionally, with this decree, the ANH no longer has the function of approving any amendment or modification
made by Ecopetrol to the exploration and production contracts entered into by Ecopetrol prior to January 1, 2004.



Energy and Gas Regulatory Commission
– CREG



Laws 142 and 143 of 1994
created CREG, a special administrative unit of the Ministry of Mines and Energy, responsible for establishing the standards for
the exploitation and use of energy, regulating the domestic utilities of electricity and fuel gas (liquefied petroleum gas and
natural gas). CREG is also responsible for fostering the development of the energy services industry, promoting competition and
responding to consumer and industry needs. Decree 4130 of 2011 assigned CREG new functions previously fulfilled by the Ministry
of Mines and Energy, such as to set prices of petroleum products along the entire chain of production and distribution, except
for regular motor gasoline, diesel and biofuels; to determine criteria and methodology for calculating the price of fuel, considering
the trading margin, the percentage of evaporation loss or any other factor that affects volume thereof; to carry out the studies
required for the determination and pricing of natural gas destined for use as automotive fuel and other purposes inherent in the
commercialization of the same; to regulate the rates in Pesos per kilometer/gallon for transportation through the pipeline system;
to regulate the activities of refining, import, storage, distribution and transportation of liquid fuels derived from petroleum.



-67-







Ministry of Environment and Sustainable
Development



The Ministry of Environment
and Sustainable Development has among its main functions the issuance of public policies regarding the use and exploitation of
natural resources and the regulation of national environmental laws.



The ministry defines the
procedures and structures that regulate the issuance of environmental licenses and permits necessary for the development of the
following activities: seismic, the construction of roads or highways, production, exploration, extraction, transportation and refining.



National Authority on Environmental
Licensing



Created by Decree 3573
of 2011, the National Authority on Environmental Licensing has among its functions the issuance of licenses and environmental permits
required for projects related to oil activities. Additionally, the National Authority on Environmental Licensing constantly monitors
license compliance, handles complaints and grievances presented by local communities, and, in general, is in charge of regulating
the procedures by which the environmental permits needed for Ecopetrol’s operation are issued and enforced.



Control Entities



Superintendency of Public Utilities



Under Colombian regulations,
the distribution and marketing of natural gas is considered a public utility. As such, this activity is regulated by Law 142 of
1994 and supervised by the Superintendency of Public Utilities (Superintendencia de Servicios Públicos Domiciliarios).



Superintendency of Corporations



We are subject to the
supervision of the Superintendency of Corporations (Superintendencia de Sociedades), the governmental body responsible for
supervising companies domiciled in Colombia.



Superintendency of Finance



The Superintendency of
Finance (Superintendencia Financiera) is responsible for monitoring, promoting and regulating the publicly traded securities
market, registered issuers, broker-dealers, mutual funds and any other participants in the public market including the BVC.



Ecopetrol is a registered
issuer (a listed corporation) in the Colombian stock market, and our debt and equity securities are publicly traded. The Superintendency
of Finance is therefore responsible for the supervision of any activity we undertake that may affect the market for our securities.
We are required to inform the Superintendency of Finance of any event material to us and to provide periodic reports of our financial
condition.



Superintendency of Ports and Transportation



The Superintendency of
Ports and Transportation (Superintendencia de Puertos y Transporte) has exclusive control over and regulates us in matters
related to ports concession contracts.



-68-







National Superintendency of Health
Care



Because we provide health
care benefits to our employees and their families, the National Superintendency of Health Care (Superintendencia Nacional de
Salud) has exclusive control over and regulates us in matters related to the inspection, supervision and control of the Social
Security Health Care System.



Superintendency of Industry and
Commerce



Ecopetrol has databases
with personal information on natural persons. That makes us responsible for information management in accordance with Decree 1377
of 2013 and Law 1581 of 2012, as implemented through the decree. Accordingly, the Superintendency of Industry and Commerce can
regulate us in respect of personal data management.



Hydrocarbon Resources Administrator



National Hydrocarbons Agency –
ANH



Any oil company selected
by the ANH to explore a specific block must sign an exploration and production contract with the ANH. All royalty payments in connection
with the production of hydrocarbons are made to the ANH in-kind unless the ANH grants a specific waiver to make royalty payments
in cash. Any oil company working in Colombia must file periodic reports on the development of its exploratory and production activities
with the ANH.



Authorities Related to Environmental
Matters



Regional Autonomous Corporations



Regulated by Law 99 of
1993, the Regional Autonomous Corporations are responsible for the administration of natural resources located in their jurisdiction
and, although they do not have legal jurisdiction over issues related to the oil industry, they are responsible for granting permission
in certain cases to issue permits for the use of certain natural resources, such as water, air or soil necessary for the development
of our activities.



Ministry of Internal Affairs



The Ministry of Internal
Affairs is responsible for certifying the existence of ethnic communities (such as Aboriginal, Afro Colombian and “Raizales,”
a Colombian legal term that refers to the people born in the San Andrés Island archipelago), including in areas in which
seismic, exploration, extraction, transportation and refining activities are being developed, and issuing general guidelines which
are developed through consultation procedures necessary for the viability of any work, project or activity intended to be done
in the territories of those communities.



Regulatory Framework



Regulation of Exploration and Production
Activities



Pursuant to Colombian
law, the Nation is the exclusive owner of all hydrocarbon resources located in Colombia and has full authority to determine the
rights to be held and royalties or compensation to be paid by investors for the exploration or production of any hydrocarbon reserves.
The Ministry of Mines and Energy and the ANH are the authorities responsible for regulating all activities related to the exploration
and production of hydrocarbons in Colombia.



Decree Law 1056 of 1953,
or the Petroleum Code (Código de Petróleos), establishes the general procedures and requirements that must
be completed by investors prior to commencing hydrocarbon exploration or production activities. The Petroleum Code sets forth general
guidelines, obligations and disclosure procedures that ought to be followed during the performance of these activities.



-69-







Prior to 2003, all activities
regarding the exploration and production of hydrocarbons were governed by Decree 2310 of 1974, which entitled Ecopetrol to explore
and exploit hydrocarbons either directly or through agreements entered into with third parties. Pursuant to such Decree Law, Ecopetrol
acted both as the Nation’s hydrocarbons resources administrator, as well as an industrial and commercial operator of fields.



Decree 2310 of 1974 was
replaced by Decree-Law 1760 of 2003, but all agreements entered into by us prior to 2003 with other oil companies are still governed
by the provisions of Decree 2310 of 1974.



Decree Law 1760 of 2003
created the ANH to regulate and oversee the exploration and production of hydrocarbon reserves. Pursuant to its exclusive legal
authority, the ANH developed a new contractual regime for hydrocarbons. Decree Law 1760 of 2003 was complemented by Decree 2288
of 2004, which regulates all aspects related to the extension and termination of contracts executed by us before 2004.



Accord 008 of 2004 (applicable
to agreements entered into by us prior to May 2012) and Accord 004 of 2012 (applicable to agreements entered into by on, or after,
May 2012) issued by the Directive Council of the ANH set forth the necessary steps for entering into exploration and production
contracts with the ANH.



Ministry of Mines and
Energy Resolution 18-1495 of 2009 establishes a series of regulations regarding hydrocarbon exploration and production.



Ministry of Mines and
Energy Resolution 180742 of 2012 included a series of technical regulations for unconventional hydrocarbon resources. This Resolution
covers technical and operational matters related to unconventional hydrocarbon resources, including the procedures for advancing
the exploration and exploitation of unconventional reserves. It also provides the types of wells and their classification as well
as the fulfillment of those minimum (drilling and abandoning) conditions, necessary to initiate or perform E&P activities.
Furthermore, it contemplates the applicable procedure to resolve disputes between Mining Sector and the Oil and Gas one, regarding
the coexistence of their rights in some specific projects. Nevertheless, Colombia has not issued any exploration licenses
and permits for the exploration of unconventional hydrocarbons. ANLA has promulgated regulations regarding environmental licenses.



Ministry of Mines and
Energy Resolution 90341 of 2014 sets forth technical requirements and procedures for unconventional reservoirs exploration and
exploitation, particularly for the use of hydraulic fracturing and the construction of wells. As a complement to this technical
regulation, the Colombian national environmental authority is preparing a terms of reference for environmental impact assessment
for unconventional reservoirs exploration and exploitation.



Pursuant to Colombian law we must pay a
percentage of our production to the ANH as royalties. Each production contract has its applicable royalty arrangement in accordance
with applicable law. In 1999, a modification to the royalty system established a sliding scale for royalty payments, linking them
to the production level of crude oil and natural gas fields discovered after July 29, 1999 and to the quality of the crude oil
produced. Since 2002, the royalties system has ranged from 8% for fields producing up to 5 thousand bpd to 25% for fields producing
in excess of 600 thousand bpd. Changes in royalty programs only apply to new discoveries and do not alter fields already in their
production stage. Producing fields pay royalties in accordance with the applicable royalty law at the time of the discovery.



Regulation of Refining and Petrochemical
Activities



Article 58 of the Petroleum
Code establishes that oil refining activities can be developed throughout the Colombian territory and are not reserved to the State.
However, Article 4 establishes that such activities are considered public utility activities subject to governmental regulation,
the development of those activities must comply with technical requirements established by regulation.



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The Ministry of Mines
and Energy and the ANH are the State Public Offices responsible for regulating, supervising and overseeing all activities related
to the refining of crude oil, including but not limited to aspects such as import of refined products, prices, storage, transportation
and distribution. Under those powers, these Offices have issued several regulations.



In 2008, Law 1205 of 2008
was issued with the main purpose of contributing to a healthier environment. It established the minimum quality specifications
for fuels in Colombia. Since August 2010, Ecopetrol has been selling diesel and gasoline that complies with the requirements of
the aforementioned law at its refinery in Barrancabermeja.



The Ministry of Mines
and Energy establishes the safety standards for LPG, storage equipment, maintenance and distribution of LPG. Regulations issued
in 1992 established that every local, commercial and industrial facility with a storage capacity of LPG greater than 420 pounds
must receive an authorization for operations from the Ministry of Mines and Energy.



Regulation Concerning Production
and Prices



Decree 2119 of 1992 restructured
the Ministry of Mines and Energy and gave it the responsibility to study industry problems and implement short- and long-term refining
planning policies. The Ministry is also responsible for evaluating, reviewing and approving all new refining projects and expansions
of existing infrastructure. Prior to approving a new project, the Ministry has to take into account, among other factors, the significance
of the project, its economic impact, sources of financing, profitability, social contribution, its effect on Colombia’s balance
of payments, and the price structure of the refined products.



Pursuant to Resolution
18-0966 of 2006 issued by the Ministry of Mines and Energy and Article 58 of the Petroleum Code, any refining company operating
in Colombia must provide a portion or, if needed, the total of its production to supply local demand prior to exporting any production.
If local demand increases, and imported crudes are needed, the refining company may charge the State additional transportation
costs in proportion to the imported crudes delivered to the refinery.



Pursuant to the same Resolution,
if the regulated production income, the main item in the price formula, is lower than the export parity price, the price paid by
the Government for the refined products to the producer has to be the equivalent to the price for those products in the U.S. Gulf
Coast market. To make such payments, the Government uses its “Fuel Price Stabilization Fund.” On the other hand, when
the regulated production income is higher than the export parity price, the producer and refiner has to pay the Government the
difference between those two prices.



As of May 2012, under
the powers granted by Decree 4130 of 2011 for currency and tax matters, the ANH determines the crude oil price reference.



A recent court ruling has eliminated one
source of income for the “Fuel Price Stabilization Fund” (established by Law 1450 of 2011) which consists of the payments
that refiners have to give the Government, calculated as the difference between the International Parity Price and the Reference
Price set by the Ministry of Mines and Energy. That decision found that the legal nature of that payment is the same as taxes and
as such, can only be set by the Legislative Branch (or by the Executive only if it complies to a method, system or parameter previously
set by the Legislative Branch). Given that there is no law that establishes that payment or determines a method, system or parameter
set to establish its elements, Congress would have legislate on the matter in order to reinstate the source of income for the aforementioned
fund. The Stabilization Fund still pays producers for the difference between the International Parity Price and the Reference Price.
If the Reference Price is greater than the International Parity Price, we would record a contingent liability for the amount of
the differential, pending Congressional action to determine a new funding source for the Fuel Price Stabilization Fund.



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Regulation of Transportation Activities



Hydrocarbon transportation
activity is considered a public utility activity in Colombia and therefore is under governmental supervision and control. Transportation
and distribution of crude oil, natural gas and refined products must comply with the Petroleum Code, the Commerce Code (Código
de Comercio)and with all governmental decrees and resolutions, including Resolutions 181258 and 124386 of 2010 issued
by the Ministry of Mines and Energy concerning Crude Oil Pipeline Transportation, and Resolutions 122 of 2008 and 092 of 2009 issued
by CREG concerning LPG Pipeline Transportation.



Notwithstanding the general
rules for hydrocarbon transportation in Colombia, natural gas transportation is subject to regulations specific to the natural
gas industry as issued by CREG, due to the categorization of natural gas distribution as a public utility activity under Colombian
laws.



Transportation systems,
classified as crude oil pipelines and multipurpose pipelines, can be owned by private parties. The construction, operation and
maintenance of pipelines must comply with environmental, social, technical and economic requirements under national and international
standards. Transportation networks must follow specific conditions regarding design and specifications, while complying with the
quality standards demanded by the oil and gas industry.



According to Law 681 of
2001, multipurpose pipelines owned by Ecopetrol (currently by Cenit) must be open to third-party use on the basis of equal access
to all.



Hydrocarbon transport
activity may be developed by third parties and must meet all requirements established by law.



The Ministry of Mines
and Energy is responsible for:



| | · | studying and approving the design and blueprints of all pipelines;
| | - | ------------------------------------------------------------------



| | · | mediation of rates between parties or, in case of disagreement, establishing the hydrocarbon transport
rates based on information furnished by the service provider;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | liquidation, distribution and verification of payment of transport-related taxes; and
| | - | -------------------------------------------------------------------------------------



| | · | managing the information system for the oil product distribution chain.
| | - | -----------------------------------------------------------------------



The construction of transportation
systems requires government licenses and local permits awarded by the Ministry of the Environment as well as other requirements
from regional environmental authorities.



Regulation on Selling, Distributing,
Transporting and Marketing of Natural Gas



Decree 2100 of 2011 issued
by the Ministry of Energy and Mines established that all producers have to make a production statement that includes the volumes
available for sale. The following table sets forth the total production statement for 2013-2017 published by the Ministry of Energy
and Mines for the fields in which we hold a stake.



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|                            |  | For the year ended December 31, |      
|--------------------------- |  | ------------------------------- | -----
|                            |  | 2013                            |      
|                            |  | (gbtud)                         |      
|Guajira Fields              |  |                                 | 586  
|Cusiana and Cupiagua Fields |  |                                 | 462  
|Other Fields                |  |                                 | 170  
|Imports(1)                  |  |                                 | 0    
|Total                       |  |                                 | 1,218










| | (1) | Imports were moved from 2012 to 2014 due to the extension of the export contract with PDVSA.
| | --- | --------------------------------------------------------------------------------------------

| | (2) | The quantity in 2014 is from September to December.
| | --- | ---------------------------------------------------



Decree 2100 of 2011 also
introduced a new regime for the selling and marketing of natural gas in Colombia, including specific procedures that regulate the
Colombian market in order to manage the remaining natural gas reserves owned by the Nation, and to protect domestic consumers,
especially residential consumers.



Decree 2100 of 2011 divided
marketing procedures depending on the production capacity of each production field in Colombia. The producers that operate fields
with capacity of more than 30 million cfpd (Large Fields) of natural gas must follow a specific procedure for selling natural gas.
The producers that operate fields producing under 30 million cfpd must follow a different procedure. Both marketing procedures
are regulated by CREG.



CREG issued Resolutions
088 of 2013 and 089 of 2013 that established the procedures for marketing of natural gas in Colombia. The aforementioned resolutions
excluded the application of the marketing procedures to the following activities: a) natural gas exportation; b) natural gas as
raw material for petrochemical procedures; and c) self-consumption from natural gas producers.



Resolution 088 of 2013,
established that Guajira price will no longer be regulated. CREG provided that parties will be free to determine the prices for
the new natural gas supply agreements, and to determine whether the prices of executed agreements shall be changed.



Resolution 089 of 2013,
issued by CREG established that the Colombian natural gas market will be divided into a primary and a secondary market.



Priorities for Delivery of Natural Gas



The Ministry of Mines and Energy established
distribution priorities in the event of a shortfall of reserves or production of natural gas. Residential consumers with existing
supply contracts, small businesses and distributors of compressed natural gas have the first priority for delivery. Contracts for
export of natural gas have the same priority under the firm commitments as other users such as industrial consumers and power generators.
The agreements that are not firm commitments and contemplate delivery of natural gas “as available” have priority over
customers on the spot market. Ecopetrol may enter into natural gas export contracts if the ratio of proved reserves to production
exceeds seven years determined by the Colombian Energy Planning Authority (UPME for its Colombian acronym).



The Ministry of Mines and Energy also establishes
distribution priorities in the event of a natural gas shortfall derived from supply or infrastructure issues. This order of priority
is based on the type of contract, with firm supply contracts having priority over interruptible supply contracts.



Primary market.



Initially, the CREG established
which agents can participate in each market. Ecopetrol is able to participate as a seller in the primary market as a natural gas
producer.



For Large Fields, Decree
2100 of 2011 and CREG Resolutions 089 of 2013 and 204 of 2013 provide a specific procedure to sell natural gas in the Colombian
market. According to the aforementioned resolutions, the Mineral and Energetic Planning Unit (UPME) must analyze the production
potential of Colombia’s productive large fields and compare it with the expected demand of natural gas in Colombia (such
analysis must be made under a low-occurrence probability scenario). If such comparison shows that in three of the next five years,
Colombia shows a lack of available natural gas to supply national demand, the producers must follow an auction procedure
in order to market the available natural gas. If the comparison shows there will be a surplus of natural gas in Colombia, natural
gas producers and consumers can negotiate directly the natural gas agreements.



If an auction must be
performed, the conditions of the auction must be clear to the whole market and there must be equal rules and opportunities for
the buyers. The natural gas available for the auction is based on the declaration established by Decree 2100 of 2011.



CREG, under Resolution
089 of 2013, established a limited list of agreements that may be entered into for natural gas marketing:



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| | · | Firm Supply Agreement. The buyer agrees to purchase a specific volume of production of natural
gas and the producer guarantees the availability of 100% of the agreed volume. If the buyer does not accept the agreed natural
gas volume, the buyer still must pay the producer the agreed price.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Conditional Firm Purchase Agreements. The buyer agrees to purchase a specific volume of production
of natural gas and the producer guarantees the availability of 100% of the agreed volume unless a specific condition takes place.
If the condition takes place, the producer can interrupt the natural gas supply.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Optional Purchase Agreements. The buyer agrees to pay a premium for its right to take a fixed
amount of natural gas if certain previously agreed conditions are met, and the buyer agrees to pay an exercise price for the amount
of natural gas effectively delivered. The producer guarantees to maintain available 100% of the agreed volume of natural gas. The
producer’s obligations will be met using natural gas that was committed to a foreign client, as provided for under our contracts
with foreign suppliers.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Interruptible Supply Agreements. The parties determine on a daily basis whether the quantity
of natural gas specified in the agreement is requested and will be supplied. Such contracts only have a 30 day term.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Contingency Supply Agreement. The parties determine on a daily basis whether the quantity of
natural gas specified in the agreement is requested and will be supplied. Such contracts will only take place to supply natural
gas when the producer is experiencing supply complications with the original natural gas source and can only be used for short
periods of time.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Conditional Firm Supply Agreements. The seller must supply the agreed natural gas volumes daily,
unless certain stated conditions take place, in which case the producer is permitted to stop the supply of natural gas. If the
producer supplies natural gas, the buyer must pay a fixed price.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



CREG Resolution 089 of
2013 established the terms of certain clauses for the aforementioned agreements. It provides for scope, force majeure, penalties,
price indexation, and contract term.



Price Controls on the La Guajira Natural
Gas Production



Under the regulatory regime in effect during
the year 2013, CREG established the maximum price Ecopetrol was allowed to charge customers that consume natural gas from La Guajira
field. Maximum prices we were able to charge to these “regulated customers” were determined with reference to the average
export price for fuel oil for the previous six months. Pursuant to Resolution 088 of 2013, the price of natural gas from the La
Guajira field was released beginning 2014.



On the other hand, Resolution 1704 of 2011
the Ministry of Mines and Energy established the methodology for determining the Natural Gas Supply Index in Colombia and decided
that for the purpose of guaranteeing sufficient domestic natural gas supply, domestic fuel gas producers marketers can freely sell
natural gas for export purposes when the potential production for one year is greater than or equal to the total expected domestic
demand for the same year and the Natural Gas Supply Index for that year is greater than or equal to eight (8) years of domestic
natural gas supply.



The export of natural gas is not considered
a public utility activity under Colombian law and therefore is not subject to Law 142 of 1994. Nevertheless, the internal supply
of natural gas is a priority for the Colombian government. This policy is included in Decree 2100 of 2011, providing that in the
event the supply of natural gas is reduced or halted as a result of a shortage, the Colombian government has the right to suspend
the supply of natural gas to foreign customers. Notwithstanding the foregoing, Decree 2100 of 2011 establishes freedom to export
natural gas under normal gas-reserve conditions.



Secondary market.



Initially, CREG determined
which agents could participate in each market. Ecopetrol is able to participate as a non-regulated user in the secondary market
as a transportation reseller.



CREG has determined that
the available transportation capacity of non-regulated users can be sold through two procedures depending on whether the available
transportation capacity is for a long-term agreement or if the capacity is to be sold on daily basis.



For a long-term capacity
transportation seller, such non-regulated user must publicly declare how much capacity is available for sale in the secondary market.
Then the administrator of the market matches the offer with an agent in the secondary market that has offered to acquire natural
gas transportation services for the same volumes offered by the non-regulated user.



On a daily basis, unused
transportation capacity will be offered on the secondary market for the non-regulated users that require transportation services
for specific needs, so that they can enter into spot market transportation agreements.



-74-







Regulation of Selling, Distributing,Transporting
and Marketing of Liquefied Petroleum Gas (LPG)



Wholesale marketing, transport,
distribution and retail marketing of LPG are mainly regulated by CREG Resolution 74 of 1996, and subsequent resolutions. LPG in
Colombia is primarily obtained through Ecopetrol’s refineries, field production and imports. The LPG must meet minimum quality
standards to be marketed. Our wholesale marketing and transport activities are regulated by Resolutions 53 of 2011 and 92 of 2009.
The LPG price is regulated by CREG Resolutions 66 of 2007 and 59 of 2008.



Regulation of Sales of Liquid Fuels



According to Article 212
of the Petroleum Code and Law 39 of 1987, the distribution of liquid fuels and their derivatives is considered a public utility
activity. Consequently, individuals or entities engaged in these activities are subject to regulations issued by the Colombian
government. The Government has the power to determine quality standards, measurement and control of liquid fuels, and establish
penalties that may apply to dealers who do not operate in compliance therewith.



The Ministry of Mines
and Energy is the entity that controls and exercises technical supervision over the distribution of liquid fuels derived from petroleum,
including the refining, import, storage, transportation and distribution in the country. Law 812 of 2003 identified the agents
of the supply chain of petroleum-derivated liquid fuels.



The distribution of liquid
fuels, except LPG, is ruled by Decree 4299 of 2005, as modified by Decrees 1333 and 1717 of 2007 and 2008, respectively, which
establishes the requirements, obligations and penalties applicable to supply agents in the distribution, refining, import, storage,
wholesale, transportation, retail sale and consumption of liquid fuels.



-75-







Decrees 283 of 1990 and
1521 of 1998, and their modifications, establish minimum technical requirements for the construction of storage plants and service
stations. The Decrees also regulate the distribution of liquid fuels, establishing the minimum requirements for distributors and
the activities and types of agreements permitted for these agents. The Ministry of Mines and Energy also regulates the types of
liquid fuels that can be sold and purchased and the penalties for noncompliance with governmental regulations.



As of May 2012, CREG determines
the prices for regulated crude oil by-products, except for gasoline, diesel and biofuels (all of which are determined by the Ministry
of Mines and Energy). The ANH determines the price for crude oil corresponding to royalty payments. Jet fuel prices are determined
according to Law 1450 of 2011.



The distribution of fuels
in areas near Colombian borders is subject to specific regulations that impose strong control procedures and requirements. Ecopetrol
is not responsible for fuel distribution in these areas. That responsibility was transferred to the Ministry of Mines and Energy,
pursuant to Law 1430 of 2010.



Regulation of Biofuel and Related
Activities



The sale and distribution
of biofuels is regulated by the Ministry of Mines and Energy. Regulations establish the quality and pricing standards for biofuels
and impose minimum requirements for mixing ethanol with gasoline and biodiesel with diesel.



Environmental Matters



Regulation



The Ministry of Environment
and Sustainable Development is the highest environmental authority in Colombia and is in charge of issuing nationwide environmental
regulations, policies, and programs. At the regional and local levels, regional environmental authorities, such as the Regional
Autonomous Corporations (Corporaciones Autónomas Regionales), are the highest environmental authorities of the region and
are in charge of executing and overseeing the enforcement of all regulations, policies and programs issued by the Ministry of Environment
within their area of jurisdiction, related to the environment and renewable natural resources, as well as overseeing any activity
from a sustainable development perspective.



Law 99 of 1993 and other
environmental regulations impose on companies, including oil and gas companies, the obligation to obtain an environmental license
prior to undertaking any activity that could negatively impact the environment or produce serious damage to the environment and
natural renewable resources. The National Authority on Environmental Licensing (ANLA), established by Decree 3573 of 2011, is responsible
for evaluating license applications, overseeing all hydrocarbons projects and monitoring compliance.



If projects or activities
may impact indigenous, Afro-Colombian or Raizal communities, the Colombian Constitution provides that the companies developing
such projects or activities must consult with those communities before initiating the project or activities or the environmental
licensing process. The communities or the relevant public oversight entities may request that a public hearing take place for this
purpose. In addition, the Colombian Constitution and laws establish that in order to comply with public participation mechanisms,
the communities may demand information regarding the activities of the project and their potential impacts.



The environmental licensing
process begins when the company files an environmental plan with the National Authority on Environmental Licensing. The licensing
process includes the application for the use of natural renewable resources (water, soil and air), the filing of an environmental
impact assessment, and a plan to prevent, mitigate, correct and compensate for any activity that may harm the environment. According
to recently issued regulations, obtaining a license may take between 165 and 265 business days, depending on whether the authority
requires the applicant to file additional information and whether it is necessary to establish a governmental committee to determine
the viability of the project.



The Ministry of Environment
and Sustainable Development is also responsible for establishing guidelines regarding climate change policies for the hydrocarbon
sector in Colombia. We are in compliance with those guidelines. At present, the Ministry of Environment has not proposed any specific
steps for the implementation of the Kyoto Protocol as it relates to our operations. We are continuously monitoring climate change
requirements that could be applicable to us.



-76-







A company that does not
comply with applicable environmental law and regulations, does not execute the environmental plan approved by the environmental
authority or ignores the requirements imposed by an environmental license may be subject to an administrative proceeding initiated
by the National Authority on Environmental Licensing or the regional environmental authorities established by Law 1333 of 2009.
The proceeding may result in oral or written warnings, monetary penalties, fines, license revocation or the temporary or permanent
suspension of the activity being undertaken.



As of December 2013, we
were party to 154 environmental administrative proceedings, of which 131 were initiated before 2013, and 23 during 2013. During
2013, 12 proceedings were concluded, in two of them we were subject to monetary fines. The largest fine imposed in 2013 amounted
to Ps$76,114,350, being confirmed by the authority after an appeal filed by the Company. It is not possible for us to determine
whether the pending proceedings could have a material effect on Ecopetrol.



Environmental Practices



During 2013, we continued
the implementation of our environmental strategy in order to meet the company’s environmental challenges, ensure high environmental
standards in operations and projects and continue contributing to corporate sustainability in environmental management. Our environmental
strategy has four strategic focuses: environmental viability, operational excellence, environmental water management and proactive
environmental management. During 2013, we invested Ps$1,312 billion in environmental programs in order to strengthen environmental
management and optimize environmental compliance. These investments include those made through contracts with our business partners
in the amount of Ps$105.6 billion. Such programs include:



| | · | Environmental Viability. This program aims to coordinate the social and environmental aspects
of the company’s projects and operations. During 2013 the environmental licensing and permitting process was defined and
the implementation phase started; this process aims to guarantee the environmental and social viability strategy for the execution
of projects and for the company’s operation. In 2013, we also continued to strengthen our relationships with the national
and regional authorities in order to obtain the environmental permits and licenses required for our projects and operations.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Environmental Legal Compliance.The purpose of this program is to guarantee knowledge of, assessment
of, disclosure pursuant to and compliance with all laws, regulations and requirements imposed by the Ministry of Environmental
and Sustainable Development, by the National Authority of Environmental Licenses and other environmental authorities.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Contingency Planning. In 2013 we implemented new guidelines for emergency management, which
detailed preparations and responses to emergencies arising from loss of stored hydrocarbons and hazardous substances, for events
caused by natural causes and for operational emergencies. Every organization’s area follows an emergency preparedness plan
according to these new requirements, which was implemented during the year by reviewing the already-implemented plans and available
resources, socialization, communication outreach, training and development exercises. Regular meetings have been established to
track the implementation of control preparedness activities in those areas.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Eco-Efficiency. This program is designed to minimize the environmental impacts resulting from
our (1) use of natural resources through activities such as water uptake and forest exploitation and (2) waste generation through
liquid emissions and the creation of hazardous waste. In 2013, nine incentives were implemented for conservation and efficient
use of water in the operational areas in order to reduce consumption and the amount of water discharged. The Paramo facility of
Transport and Logistic Vice presidency reached zero liquid discharge. Also in this year, the amount of reinjected water increased
by 26% compared to 2012. Regarding solid waste, recycling activities increased by 15% from the past year, decreasing the amounts
of waste going to landfills.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | · | Biodiversity. This program implements initiatives to preserve endangered species and ecosystems
in areas where our activities have strong influence. In 2013, we invested Ps$19.9 billion to develop projects related to biodiversity.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Climate Change.We have designed a climate change strategy to guide, plan, define and execute
our actions towards mitigating the effects of climate change and our participation in the elaboration of local and international
climate change policies. In this context, we have entered into technical cooperation agreements with different parties, such as
the U.S. Environmental Protection Agency under the Global Methane Initiative, and the Petroleum Technology Alliance of Canada under
the energy efficiency program. The principal objectives of the strategy are: (1) a low carbon emission operation, and (2) the reduction
of operations and facilities’ vulnerability to climate change effects through the implementation of 11 action lines, grouped
into four strategic areas (mitigation, vulnerability and adaptation, research and technology and involvement in policy drafting).
In 2013, 11 projects of processes optimization, energy efficiency and gas exploitation were implemented, representing a decrease
during one operational year of 215,314 tons of carbon dioxide, and seven reforestation and avoided deforestation projects that
will be executed during the next three years were co-financed in several Colombian regions.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Energy Projects



We have been undertaking
significant efforts to make efficient and rational use of energy resources in our production processes, reducing consumption, costs
and carbon dioxide emissions. In line with the 2012 update of our Strategic Plan, energy issues have taken on special relevance.
These issues include energy use, which encompasses the concept of integral energy solutions focused on efficiency, reliability
and optimization, and the energy diversification. Our 2013 energy efficiency program Integral System of Energy Management was completed
for the pipeline Puerto Salgar-Mansilla. The approximate energy savings totaled 337,464 kwh per month, equivalent to US$40,000
and 52.9 tons of CO2 per month. In 2014, we will continue our efforts in these matters to develop the production business
baseline measurement in energy efficiency, which we expect will result in a 10% reduction in energy consumption. Additionally,
we finished the feasibility studies of potential pipeline energy recovery at our pumping stations in Vasconia and La Belleza. We
expect to develop this idea through CENIT in 2014.



In line with our initiatives
to diversify the energy resources we use, we finished two studies during 2013 on the use of water, solar and wind resources. The
first one, regarding Small Hydraulic Plants (PCH – Pequeñas Centrales Hidráulicas) attempts to identify
water resources with enough generation potential to supply the demand of our operations in the South Region. The second aims to
measure 13 operation areas to determine which of them have adequate conditions to implement applications of solar and eolic resources
that could (1) have a positive impact on emissions reduction, (2) provide energy solutions to reduce consumption and (3) have economic
feasibility.



| | · | Potential Pipeline Energy Recovery.The project is currently under analysis. Our analyses of
energy-use optimization, carbon footprint reduction, and system-reliability improvement analysis in the Vasconia pumping station
were concluded in April 2013.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Solar – Wind Energy Potential.We achieved two important goals in 2013. We completed
the collection of measures of 12 months’ radiation and wind speed, relevant information to identify six locations potentially
well suited for the development of solar-energy projects. In November 2013, the refinery of Barrancabermeja began to develop the
stages of a solar generation project.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Small Hydroelectric Plant (SHP).We have developed two studies in the southern region of Colombia
in order to determine the economic and technical feasibility of pursuing hydroelectric projects near identified water resources.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Contingency Plans and Environmental
Remediation



All of Ecopetrol’s
areas have preparedness and emergency response plans for emergencies caused by loss of contained hydrocarbons, in accordance with
legal requirements and following the new internal guidelines for emergency management. In addition, we comply with Decree 321 of
1999 and the National Contingency Plan, which are a set of guidelines that must be followed by oil and gas companies in Colombia
to prevent, and react in case of, operational events that could impact the environment.



These plans incorporate
management measures for oil spills and harmful substances, and have been developed based on the identification of risk scenarios,
the estimated consequences of these events and the definition of strategies to follow in each type of scenario.



The procedures for emergency
plans define actions to be taken in areas of process, human settlements, protected areas, water catchment sites, aquifers and environmental
areas according to the type of environment involved.



Response measures include
procedures for oil spill control and procedures for the safety of personnel involved in the control actions and communities. The
procedures define response actions in order to protect health, safety and the environment, prevent oil spills and to mitigate environmental
impacts.



The plans have procedures
for process areas beyond the facilities. In external areas spill response procedures apply for marine and inland areas. These control
procedures involve actions for containment and recovery of spilled product, and cleaning and recovery of affected areas. Plans
call for mechanical recovery techniques using containment equipment, recovery, temporary storage and waste transport. The plans
also call for equipment and supplies to treat spillage with dispersant products, sorbents, adsorbents and resources required for
the washing, cleaning and treatment of contaminated soils.



For offshore joint ventures,
the operator partner has the responsibility of designing and implementing remediation plans and procedures to deal with operational
emergencies in accordance with best practices and local environmental regulations. These plans cover emergency tier 1 and in some
cases tier 2, depending on the distance from the coast, and if the emergency happens at tiers 2 and 3 or in any way exceeds its
response capacity, the response would have the support of the foundation ground response.



Emergency plans include
recovery procedures for the affected areas, which are defined in a remediation plan agreed with the environmental and territorial
authority. This agreement includes recovery actions for soils affected by spills, and monitoring of these areas to ensure that
the affected areas are returned to their initial state.



Emergency plans cover
post-emergency activities should they become necessary, such as extracting infiltrated product from soils, cleaning the affected
area, recovery of soils and water bodies, monitoring, and compensation.



The post-emergency activities
will be based in part on the findings of a damage assessment of the area that includes the participation of stakeholders, other
organizations and the community. This interdisciplinary group defines the actions necessary for recovery of the affected area in
the short, medium and long term.



The techniques consider
the particular requirements of the environmentally sensitive area, using pre-established procedures in the emergency plan. All
plans have identified environmentally sensitive areas. These areas also classified by type and criticality levels to establish
the parameters and also define the specific control technique for each one. In the process of identifying environmental areas,
the recommended techniques for treatment of spills in each of these areas are also identified. The ranking of environmental areas
is done by identifying the type of soil, vegetation, systems interaction, the local species, interaction with other ecosystems,
and the local and regional importance of the area in terms of political and social relevance. The identification of these areas
aims to cause the least impact resulting from recovery activities. Such recovery activities include the extraction of the product
under the soil, the soil washing, and treatment of hydrocarbon, water and plant residues. These operating procedures are separate
from the legal environmental requirements, techniques, technologies and practices recognized globally.



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Health, Safety and the Environment



We are devoted to improving
our health, safety and environmental (HSE) practices. We have several programs in place to increase our industrial and process
safety, minimize the number of accidents and minimize catastrophic incidents. The frequency of accidents taking place at our premises
has declined significantly to 0.7 accidents per million hours worked in 2013 from 5.77 accidents per million hours worked in 2005.
Additionally, since 2009 we have been working on a “Process Safety Management” (PSM) system aimed at the minimization
of operational incidents, such as fire, explosion, loss of primary containment and multiple fatalities. Our PSM Strategy is to:
first, define high-risk processes; second, prioritize intervention in high-risk processes; and third, apply all PSM elements in
the prioritized high-risk processes.



We have made the following
improvements in six main areas:



(1)	culture and leadership:
we have created online committees and established a management control structure for the control of HSE and PSM.



(2)	HSE competency
in our employees and contractors: we have focused on closing competency gaps for critical process safety positions and performed
assessments of PSM factors during the planning and selection of contractors.



(3)	safe design: we
have taken an inventory of available documentation and have a plan to update documentation for all of our facilities, and we have
created a risk analysis program for all facilities and priorities on critical ones.



(4)	safe operation:
we have implemented an operational discipline cycle for critical procedures and have identified critical equipment and spare parts
for PSM.



(5)	prevention of and
response to emergencies: we have made available emergency plans in accordance with the major scenarios for critical facilities
and processes, and performed emergency drills.



(6)	performance and
audits: we have changed from studying lagging indicators to including leading indicators with a focus on process safety.



In 2013, we recorded 34
environmental incidents; 27 were recorded in 2012 and 41 in 2011. Oil spills increased from 4,050 barrels in 2012 to 6,843 barrels
in 2013. This increase was primarily due to a fuel spill in the Caño Limón Coveñas pipeline of 2,620 barrels,
an oil spill in the Ayacucho Coveñas pipeline of 1,289 barrels and a fuel spill in the Salgar Mancilla pipeline of 950 barrels.



Human Rights Initiatives



Ecopetrol has a strong
commitment to the respect and promotion of human rights. During 2013 we updated our Human Rights Policy, adopting new international
standards for business and human rights. This change was based on the adoption of an integrated and systemic management approach
through the implementation of a human rights management system, which is based on the due diligence principle.



The updated document has
two objectives:



(1)	to ensure the congruence
between the company performance and national and international human rights laws and also with voluntary international standards,
and



(2)	to generate value
to the company and to society through the promotion of human rights.



The international standards
adopted by Ecopetrol are the following: Guiding Principles on Business and Human Rights (the United Nations “Protect, Respect
and Remedy” Framework), the Voluntary Principles on Security and Human Rights and the UN Global Compact's ten principles.



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Considering the due diligence
principle and also the international standards, Ecopetrol has carried out a human rights risks assessment in order to prioritize
certain actions to prevent and mitigate human rights impacts. Due to this assessment, Ecopetrol has focused its efforts on the
following rights:



| | · | right to life, liberty and personal security;
| | - | ---------------------------------------------



| | · | right of association and collective bargaining;
| | - | -----------------------------------------------



| | · | abolition of forced or compulsory labor;
| | - | ----------------------------------------



| | · | abolition of child labor;
| | - | -------------------------



| | · | equality and non-discrimination at work;
| | - | ----------------------------------------



| | · | just, equitable, and satisfactory conditions of work;
| | - | -----------------------------------------------------



| | · | rights of ethnic groups; and
| | - | ----------------------------



| | · | collective rights and the environment.
| | - | --------------------------------------



Today, Ecopetrol maintains
mechanisms to secure human rights (Human Rights Committee, Tactical Plan on Human Rights). One outstanding initiative in 2013 was
the implementation of the Human Rights Monitoring System, which is in charge of monitoring the behavior of the human rights risks,
in order to identify potential impacts that can be prevented or mitigated.



Ecopetrol’s implementation
of the Voluntary Principles in 2013 led us to conduct nine workshops that covered the seven regions where we operate. All of our
security professionals and analysts assisted in reviewing fundamental notions of human rights and standards of care and strengthened
their skills in implementing due diligence processes to identify, prevent, mitigate and address negative impacts on human rights
while conducting security-related activities.



In addition, under the
framework of our joint project with the Presidential Program on Integral Action Against Landmines to provide knowledge on risk
assessment and management, safe practices and basic life support skills to company personnel and communities, we reached 509 people
who actively participated in nine workshops around the country. This project was distinguished as a good practice at the First
Regional Forum on Business and Human Rights in Latin America and the Caribbean, held in August of 2013 in Medellin, Colombia.



Dow Jones Sustainability Index (DJSI)



In 2013, we continued
to be listed on the Dow Jones Sustainability Index–World. This index tracks the financial performance of the leading
sustainability-driven companies worldwide and is a reference used to assess corporate sustainability.



Insurance



We have a clear and defined
corporate policy based on risk financing guidelines that summarizes the Company’s risk transference and retention alternatives
and provides support and guidance for all the insurance-related issues of all of our affiliated and subsidiary companies.



There are two corporate
insurance programs according to our core business operations, insured values, limits and other aspects.



In the text and tables
below, we set forth our insurance programs and the companies covered, along with limits and coverage details.



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World-Wide Umbrella
Program. This insurance program provides coverage for downstream (assets and operations) of Ecopetrol S.A. and all of its affiliates
and subsidiaries in excess of their local insurance programs, and also in excess of the “Global Energy Package” program,
when applicable. Coverage includes all physical damage, sabotage and terrorism, general liability, directors and officers, crime
and marine cargo. Physical damage and  sabotage and terrorism coverages were designed to cover downstream operations, while
general liability, directors and officers, crime and marine cargo coverages were designed to cover down-, mid- and upstream operations.



|                       |  | Limit
    (eel/agg(1)) |       |            | Deductible |         |    |          |  |          |                                                    |        |           |       |     |         |  |           |           |     |   |       |  |    |  | 
|---------------------- |  | ---------------------- | ----- | ---------- | ---------- | ------- | -- | -------- |  | -------- | -------------------------------------------------- | ------ | --------- | ----- | --- | ------- |  | --------- | --------- | --- | - | ----- |  | -- |  | 
|Policies               |  | Onshore                |       |            | Offshore   |         |    | Onshore  |  |          | Offshore                                           |        | Ecopetrol |       |     |         |  |           | Ecopetrol |     |   |       |  |    |  | 
|                       |  | (US$
    in million)   |       | Downstream |            | Reficar |    | Proplico |  | Upstream |                                                    | Equión |           | Hocol |     | America |  | Brazil(2) |           | ODL |   | Cenit | 
|Property all risk      |  |                        | 2,000 |            |            |         | NA |          |  |          | 5
                                         - 10    |        |           |       | N/A |         |  | X         |           |     | X |       |  | X  |  | 
|Sabotage and terrorism |  |                        | 600   |            |            |         | NA |          |  |          | 0.5                                                |        |           |       | N/A |         |  | X         |           |     | X |       |  | X  |  | 
|Third-party Liability  |  |                        | 500   |            |            |         | NA |          |  |          | 1
                                         – 5 (3) |        |           |       | NA  |         |  | X         |           |     | X |       |  | X  |  | 
|Crime                  |  |                        | 50    |            |            |         | NA |          |  |          | Various                                            |        |           |       | NA  |         |  | X         |           |     | X |       |  | X  |  | 
|Directors and Officers |  |                        | 250   |            |            |         | NA |          |  |          | Various                                            |        |           |       | NA  |         |  | X         |           |     | X |       |  | X  |  | 
|Cargo                  |  |                        | 250   |            |            |         | NA |          |  |          | 3% Dispatch                                        |        |           |       | NA  |         |  | X         |           |     | X |       |  | NA |  | 








| | (1) | Eel: each and every loss. Agg: Aggregate.
| | --- | -----------------------------------------

| | (2) | There are no insurable assets in Brazil
| | --- | ---------------------------------------

| | (3) | US$5M deductible for pollution liability only
| | --- | ---------------------------------------------



Global Energy Package.
This program provides coverage for upstream and midstream (assets and operations) of Ecopetrol’s interests and all of its
upstream affiliate and subsidiary companies, including all physical damage, sabotage and terrorism, general liability and control
of wells.



|                       |  | Limit (eel/agg(1)) |           |          | Deductible |        |     |         |  |         |          |        |           |     |      |       |  |   |  | 
|---------------------- |  | ------------------ | --------- | -------- | ---------- | ------ | --- | ------- |  | ------- | -------- | ------ | --------- | --- | ---- | ----- |  | - |  | 
|Policies               |  | Onshore            |           |          | Offshore   |        |     | Onshore |  |         | Offshore |        | Ecopetrol |     |      |       |  |   |  | 
|                       |  | (US$ in million)   |           | Upstream |            | Equión |     | Hocol   |  | America |          | Brazil |           | ODL |      | Cenit | 
|Property All Risk      |  |                    | 400       |          |            |        | 400 |         |  |         | .025     |        |           |     | 0.5  |       |  | X |  | 
|Sabotage and terrorism |  |                    | 50        |          |            |        | 50  |         |  |         | 0.5      |        |           |     | N/A  |       |  | X |  | 
|Third-party Liability  |  |                    | NA        |          |            |        | 500 |         |  |         | N/A      |        |           |     | 0.15 |       |  | X |  | 
|Control of wells       |  |                    | 25-250(2) |          |            |        | 400 |         |  |         | 0.25     |        |           |     | 5    |       |  | X |  | 










| | (1) | Eel: each and every loss. Agg: Aggregate.
| | --- | -----------------------------------------

| | (2) | Drilling US$250M / Production US$25m
| | --- | ------------------------------------



Our third-party liability
insurance policies cover Ecopetrol, our subsidiaries and affiliates in excess of local underlying policy limits for claims made
against them by third parties. Our commercial general liability, umbrella liability, and excess liability coverages will pay on
behalf of or indemnify amounts for which an insured becomes legally obligated to pay, including damages in respect of bodily injury,
property, pollution and product liability. Coverage of bodily injury and property damage is subject to coverage territory during
the policy period.



We do not currently act
as an operator in any offshore production operation, although we are involved in certain offshore joint ventures in Colombia, the
U.S. Gulf Coast and Brazil, and we have exploration operations offshore of the Colombian Caribbean coast, which are operated by
Ecopetrol. In Colombia, currently offshore production operations are carried out by Chevron. There are two platforms that produce
liquefied petroleum gas. The Global Energy Package programs cover all of our interests.



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With respect to offshore
operations in the U.S. Gulf Coast, Ecopetrol America Inc. is party to Operating Agreements, or OA, that include customary conditions
and which contain similar terms and provisions to those in the Model Form of Offshore Deepwater Operating Agreement of the American
Association of Professional Landmen (AAPL). In general, pursuant to these OAs, the obligations, duties, and liabilities of the
contract parties are several, and not joint or collective, for all operations covered by the OAs. Liability for losses, damages,
costs, expenses, or claims involving activities or operations under the OAs which are not covered by or in excess of the insurance
carried for the joint account are borne by each contract party in proportion to its participating interest in the activity or operation
out of which that liability arises, except when any damages result from a party’s gross negligence or willful misconduct,
in which case, such party is solely liable for such damages. The operators supervise the handling, conduct, and prosecution of
all claims involving activities or operations under the respective OA or affecting the leases or the contract area covered thereunder.
Finally, operators must obtain insurance as required by the OA which costs are charged to the joint account and must have HSE practices
in place and comply with locally applicable HSE-related statutory requirements.



Ecopetrol Óleo
e Gás do Brasil Ltda. and Ecopetrol del Perú are parties to Joint Operating Agreements (JOA) based on the Association
of International Petroleum Negotiators (AIPN) model. Liability is generally the same as described for the OA above, with the following
variations: if claims arise from third parties as part of a claim not involving an operator’s gross negligence or willful
misconduct, and the operator pays such claims, all parties must concur and reimburse such claim amounts. In certain contracts,
all environmental damages are distributed according to the parties’ participation interest, regardless of whether the damages
were caused by an operator’s gross negligence or willful misconduct. In certain cases, non-operators may intervene and directly
verify compliance of the operator’s HSE programs. Ecopetrol uses the same liability clauses in JOAs for offshore operations
in Colombia, when Colombian laws do not govern such agreements.



Property,
Plant and Equipment



Under Colombian law, the
Nation owns all crude oil and natural gas reserves within Colombia and we have certain rights to explore and produce those reserves
in areas awarded by the ANH after public bidding. Most of our property, consisting of refineries and storage, production and transportation
facilities, is located in Colombia. Our main assets consist of our wells, refining facilities and our pipelines. See “Item
4. Information on the Company—Overview by Business Segment—Reserves” for a description of our reserves, sources
of crude oil and natural gas, main tangible assets and material plans for expansion and improvements in our facilities. See “Item
5. Operating and Financial Review and Prospects—Liquidity and Capital Resources—Use of Funds—Capital Expenditures”
and “Item 4. Information on the Company—Transportation and Logistics.”



| | ITEM 4.A. | Unresolved Staff Comments
| | --------- | -------------------------



None.



| | ITEM 5. | Operating and Financial Review and Prospects
| | ------- | --------------------------------------------



The following discussion
considers our financial results and prospects as well as factors that affect our consolidated results of operation under Colombian
Government Entity GAAP, unless otherwise indicated.



Effects of Acquisitions



Our most significant recent
acquisitions are listed below, together with the effective date as of which each has been reflected in our financial statements.
The following acquisition was funded mainly through cash on hand and cash flow from our operations.



| | · | Offshore International Group Inc., or OIG (February 2009) – 50% ownership. OIG is incorporated
in the United States and its main asset is Savía Perú, which carries out offshore exploration and production activities
in Peru and has 7.6 million hectares of exploration and production areas. Savía Perú contributed with a gross production
of approximately 6.1 thousand boepd in 2013.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | · | Ocensa (March 2009) – 72.65% ownership. In January 2011, as a result of our acquisition of BP
Exploration Company Limited, we indirectly acquired 51% of its interest in Ocensa, increasing our share in the company to 72.65%.
With this acquisition we increased our participation in a key crude oil transport system in Colombia, which transports approximately
57.5% of total crude oil production that reaches the Coveñas export facilities. Prior to the acquisition of BP Exploration,
in March 2009, we entered into an agreement with Enbridge Inc., a Canadian company, pursuant to which we acquired 100% of its stake
in Ocensa, thereby increasing our interest in Ocensa from 35.3% to 60%. During 2013, we used, on average, approximately 98% of
the total capacity of this system.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Reficar (May 2009) – 100% ownership. After increasing our participation in Reficar from 49 % to
100% in May 2009, we have continued to expand and modernize the Cartagena refinery, a process that we expect to complete in 2015.
We believe this project, which is currently expected to involve US$6.5 billion in total project cost, will allow us to transform
heavy crude oil into more valuable products by increasing our conversion ratios, thereby improving our profitability.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Hocol Petroleum Limited (May 2009) – 100% ownership. The principal asset is Hocol, which has
exploration and production activities in Colombia. This operation contributed to an increase in our hydrocarbon reserves and production
in Colombia. In 2013, Hocol contributed a gross production of 21.4 thousand boepd.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Equión Energía Limited (January 2011) – 51% ownership. BP Exploration Company
Limited sold its interests in Colombia, which we acquired together with Talisman Colombia Holdco Limited. The company was later
renamed Equión Energía Limited. During 2013, Equión contributed gross production before royalties of 9.6 thousand
bpd of crude oil and 42 mcfpd of natural gas.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



For more information on
our acquisitions, see “Item 4. Information on the Company.”



Factors Affecting our Operating Results



Our operating results
are affected mainly by international prices of crude oil, refined products and natural gas, sales volumes and product mix. Lower
crude oil volumes can impact our operating results negatively, particularly with respect to the exploration and production segments
of our business. This is because as export volumes of crude oil decrease so do revenues. Results from our refining activities are
also affected by conversion ratios, utilization rates, refining capacity and operating costs, all of which affect our refining
margins. Finally, changes in the value of foreign currencies, particularly the U.S. dollar against the Peso, have a significant
effect on our financial statements.



Sales Volumes and Prices



The results from the exploration
and production segment depend on production levels and average local and international prices for crude oil and natural gas that
we bring to market. Additionally, sales volumes are affected by the purchase of crude oil and natural gas that we make from our
business partners, third parties and the ANH.



We sell crude oil mainly
in the international market as exports. We also both process crude oil at the Barrancabermeja and Reficar refineries and sell refined
products in local and international markets.



Local Sales and Prices



We have a number of crude
oil and natural gas long-term supply contracts with local customers, including Reficar, gas-fired power plants and local natural
gas distribution companies. Local sale prices are determined in accordance with existing regulations, contractual arrangements
and the spot market linked to international benchmarks.



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International Sales and Prices



We export surpluses of
crude oil and refined products only after our supply commitments with our refineries and local customers have been fulfilled.



During the past three
years, we have significantly increased our international sales on a “delivered” basis to the Caribbean, Central America,
United States and Asian markets, achieving an average growth  that exceeds 10% per year. In 2013 our delivered sales reached
94 thousand bpd. The latter gives us more flexibility both in operational and commercial terms.



Our commercial strategy,
which includes market diversification, focuses on placing our products in countries other than the U.S., such as China, India,
Singapore and Spain. This diversification enlarges the number of international benchmarks that we use as a reference in our negotiations.
We seek to use as benchmark reference prices in each region the prices the markets for which there is the most liquidity. In addition,
we have started to replace volume from the Colombian supply chain by purchasing refined products from international suppliers and
selling such products to clients in the foreign market.



Gasoline and Diesel Price Differentials



For domestic sales of
gasoline and diesel, we charge wholesalers of gasoline and diesel the domestic prices established by the Government. As part of
revenues from the sales, we accrue the amount of any fuel price differential due pursuant to Law 1151 of 2007 as revenues and record
an account receivable from the Government for the amount of the differential. See “Item 3. Key Information—Risk Factors—Risks
related to our business.”



The fuel price differential
payment from the Ministry of Mines and Energy corresponding to the first three quarters of 2011 was paid in December 2011. The
fuel price differential payment from the Ministry of Mines and Energy corresponding to the fourth quarter of 2011 was Ps$571.8
billion and for the year ended of 2012 was Ps$1,381.5 billion. In April 2013, the Ministry of Mines and Energy paid the corresponding
amounts due to us for the fourth quarter of 2011 and first three quarters of 2012, amounting to Ps$1,271.9 billion. The amount
due to us, corresponding to the fourth quarter of 2012 and to the full year 2013, is equivalent to Ps$1058.7 billion.



Exploration Costs



We account for exploratory
drilling costs using the successful effort method whereby all costs associated with the exploration and drilling of productive
wells are capitalized, while costs incurred in exploring and drilling of dry wells are expensed in the period in which the well
is determined to be a dry well and accounted for under “operating expenses—studies and projects.” Consequently,
the number of exploratory wells we declared as dry negatively affects our results. As such, the significant expansion of our drilling
program, which we are currently undertaking, will likely result in higher dry well expenses and may lead to material changes or
volatility in our operating expenses.



Royalties



We used to be required
by law to pay in-kind a percentage of our production (crude oil and natural gas) to the ANH as royalties. Each production contract
has its own royalty arrangement. In 1999, a modification to the royalty system established a sliding scale for royalty payments
linked to the production level of crude oil and natural gas fields discovered after July 29, 1999, depending on whether the production
is crude oil or natural gas, and on the quality of the crude oil produced. Since 2002, the royalty percentage has ranged from
8% for fields producing up to 5,000 bpd to 25% for fields producing in excess of 600 thousand bpd. Producing fields pay royalties
in accordance with the applicable royalty rate at the time of the discovery.



Regarding gas royalties, that during 2013
ranged from 6.4% to 32%, pursuant to Decree 2100 of 2011, we entered into an agreement with the ANH under which we would no longer
purchase natural gas received in-kind by the ANH as royalties and instead would commercialize the natural gas of those fields in
which the producer did not decide to directly commercialize the royalties. The agreement with the ANH established that we would
sell to third parties, on behalf of the ANH, the natural gas belonging to the government between 2012 and 2013. This agreement
became effective in July 2012 and reduced the natural gas we purchased from the ANH and sold to third parties by approximately
100 gbtud during 2012.



-85-









Beginning on January 1, 2014, the method
of marketing the gas of royalties changed once again, pursuant to ANH Resolution 877 of 2013. Royalties generated by natural gas
exploitation will be collected in cash by the ANH from natural gas producers, regardless of whether the producer has sold the gas,
based on a formula linked to the applicable royalty rate. Therefore, we will no longer market this gas on behalf of the ANH.





Purchases of Hydrocarbons from
the ANH



We continue purchasing
all crude oil delivered to the ANH by us and from third parties. We also purchase natural gas from minor fields not covered by
the agreement with ANH described above. Prices are set forth in a contract between the ANH and us dated December 28, 2012, and
a natural gas offer letter from ANH dated June 17, 2009. For crude oil, the purchase price is calculated according to a formula
that includes our export sales prices (crudes and products), a quality adjustment for API gravity and sulfur content, the transportation
rates from the wellhead to the Coveñas and Tumaco ports, the refining process cost and a marketing fee. We sell the physical
product purchased from the ANH as part of our ordinary business. On December 31, 2013, this contract between the ANH and us as
well as the natural gas offer letter was extended until December 31, 2014.



Import of Products for Transportation
and Blending



We use naphtha to facilitate
the transportation of crude oil through pipelines. During 2013, we increased the volume of imported naphtha to 18.5 million barrels
from 14.5 million barrels in 2012. This growth reflects higher demand of the product, which represented a higher proportion of
our production in 2013 compared with 2012.



In addition, in 2013 in
order to meet local demand for diesel, we imported 17.0 million barrels of Ultra Low Sulfur Diesel, an increase of 5.5 million
barrels from 2012 numbers. This increase reflects, in part, a reduction of Low Sulfur Diesel imports, in favor of imports of ultra
low sulfur diesels, growth in local demand for diesel and lower domestic production of this product related to scheduled maintenance
of topping plants in Barrancabermeja. Our variable costs are affected by available volumes of these products and their prices,
which affects our operating results. We expect the modernization of the Reficar refinery to allow us to significantly reduce our
imports of Ultra Low Sulfur Diesel.



Purchases of Hydrocarbons



Our purchases of hydrocarbons
are made in the ordinary course of business, and on terms comparable to those offered to private parties. We have established procurement
policies and approval processes for purchases of products and services, which do not depend on whether the counterparties are state-owned
entities.



Effect of Taxes and Exchange Rate Variation
on our Income



Income Taxes



The Colombian Congress
adopted Law 1607 of 2012, which introduces significant reforms to the Colombian tax system. In particular, the income tax rate
was reduced from 33% to 25% starting in 2013 and the Equality Income Tax (Impuesto de Renta para la Equidad - CREE) was
created with a rate of 9% from 2013 to 2015 and 8% starting in 2016. There are some differences between the treatment used to determine
this tax and the one used to determine ordinary income tax. As a result, as of January 2013, our income is taxed at a rate of 34%.
From 2008 until December 2012, the standard corporate rate in Colombia was 33%.



The tax effect of Law
1607 of 2012 on the Company is mainly reflected in the increase of 1% in the combined tax rate on income tax and CREE (33% - 2013
and 34% - 2014), equivalent to US$105 million. The discount in payroll taxes resulting from the establishment of the CREE is only
US$2 million because the income of the majority of employees in the company exceeds the threshold established in order to obtain
the benefit.



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Exchange Rate Variation



In compliance with Colombian
regulations, our results are reported in Pesos, and we maintain our financial books and records in Pesos. 99% of our revenues for
local sales and exports of crude oil, natural gas and refined products are sold at prices referenced to benchmarks quoted in U.S.
dollars.



During 2012 and 2011,
the Peso appreciated on average 2.7%, and 2.6%, respectively, against the U.S. dollar. During 2013, in contrast, the Peso depreciated
against the U.S. dollar on average by 3.9%. An appreciation of the Peso has a negative impact on our income statements because
our revenues from exports of crude oil, natural gas and refined products are reduced in Pesos. Imported goods and contracted
services expressed in U.S. dollars will also be lower than those expressed in Pesos, but on balance, our net income in Pesos tends
to decline when the Peso appreciates, other factors being equal. Conversely, when the Peso depreciates against the U.S. dollar,
our reported revenues, costs related to imported goods and services, interest costs, and net income, all tend to increase. In 2013
Ecopetrol S.A. raised US$2,500 million through bond issuance and US$288 million through US Eximbank facilities. Reficar raised
US$616 million through Export Credit Agencies facilities. In 2012, we did not incur any U.S. dollar-denominated debt. In 2011,
we raised US$3,500 million and US$80 million through our subsidiaries Reficar and Propilco, respectively.



New Accounting Policies



Colombian Government Entity GAAP



There were no significant
new accounting standards effective in the year 2013 impacting the Company pursuant to Colombian Government Entity GAAP.



U.S. GAAP



In February 2013, FASB
issued ASU No. 2013-02 Other Comprehensive Income (ASC 220), effective prospectively for reporting periods beginning after December
15, 2012. The ASU requires an entity to disclose any reclassifications out of other comprehensive income if the amount is required
under U.S. GAAP to be reclassified in their entirety in the same reporting period. For other amounts that are not required to be
reclassified in their entirety to net income in the same reporting period an entity is required to cross-reference other disclosures
that provide additional detail about those amounts. Ecopetrol adopted this ASU from this reporting period; see Note 3 to our consolidated
financial statements. No material effects arose from the adoption. See Note 3 to our consolidated financial statements.



Transition to IFRS



For more information on
our transition to IFRS, please see Note 1 to our consolidated financial statements.



Critical Accounting Policies and Estimates



The following discussion
sets forth our critical accounting policies. Critical accounting policies are those policies that require us to exercise judgment
or involve a higher degree of complexity in the application of the accounting policies that currently affect our financial condition
and results of operations. The accounting estimates we make in these contexts require us to calculate variables and make assumptions
about matters that are highly uncertain. In each case, if we had made other estimates, or if changes in the estimates occur from
period to period, our financial condition and results of operations could be materially affected. This information should be read
together with Note 1 to our consolidated financial statements for a summary of the principal accounting policies and practices
applicable to us. There are many other areas in which we use estimates about uncertain matters, but the reasonably likely effect
of changed or different estimates is not material to our financial presentation.



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Oil and Gas Reserves



When accounting for our
reserves we use the internationally recognized “successful efforts” method of accounting for investments in exploration
and production areas. These investments are amortized using the technical units of production method on the basis of proved developed
reserves by field. The reserves are based on technical studies prepared internally. Internally estimated reserves are then submitted
to an external audit process, which is carried out by our External Engineers. According to our corporate policy, we report the
reserves values obtained from the External Engineers. The Reserves Director consolidates the results and presents them to the Reserves
Committee, whose members are the Chief Financial Officer, the Exploration and Production Executive Vice-President and the Vice-President
of Strategy. Results are presented to the Audit Committee of the Board of Directors and finally approved by the Board of Directors.



Reserves classifications
used in this report are in accordance with the reserves definitions of Rules 4–10(a) (1)–(32) of Regulation S–X
of the SEC. Reserves are judged to be economically viable in future years from known reservoirs if, under existing economic and
operating conditions and assuming the continuation of current regulatory practices using conventional production methods and equipment,
there is reasonable certainty that they will be recoverable.



The Company’s proved
reserves as of December 31, 2013 are based on the SEC average price methodology for U.S. GAAP purposes, which mirrors the average
price methodology used by the Company in Colombia during this period.



The estimation of hydrocarbon
reserves is subject to several uncertainties inherent to the determination of proved reserves, production recovery rates, the timelines
with which investments are made to develop the reservoirs and the degree of maturity of the fields.



Crude oil prices have
traditionally fluctuated as a result of a variety of factors such as changes in international prices of natural gas and refined
products, long-term changes in the demand for crude oil, natural gas and refined products, regulatory changes, inventory levels,
increase in the cost of capital, economic conditions, development of new technologies, economic and political events, and local
and global demand and supply. Revisions to proved reserves estimates of crude oil and gas and the effect of such price variations
are presented in Note 35 to our consolidated financial statements. Changes in the crude oil price may affect our estimates in the
future. A decrease in our estimated proved reserves due to pricing may result in the impairment of oil and gas properties.



The calculation of units-of-production
depreciation and depletion is a critical accounting estimate that measures the depreciation and depletion of upstream assets. The
units of production are equal to the ratio of actual volumes produced to total proved developed reserves (those proved reserves
recoverable through existing wells with existing equipment and operating methods) and applied to our asset cost.



Proved oil and gas properties
held and used by us are reviewed for impairment whenever events or circumstances indicate that the carrying amounts may not be
recoverable. Impairments are measured by the amount by which the carrying value exceeds its fair value. Any impairment tests that
we perform make use of our long-term price assumptions for the crude oil and natural gas markets and petroleum products.



Volumes produced and asset
costs are known, while proved reserves have a reasonable certainty of recoverability and are based on estimates that are subject
to some variability. The impact of changes in estimated proved reserves is treated prospectively by depreciating the remaining
book value of the assets over the future expected production, affecting the following year’s net income.



Suspended Exploratory Well Costs



We capitalize exploratory
well costs when the well has found a sufficient quantity of reserves to justify its completion as a producing well and the Company
is making sufficient progress assessing the reserves and the economic and operating viability of the project. Exploratory well
costs that do not meet these criteria are charged as an expense. The facts and circumstances that support continued capitalization
of suspended wells as of year-end 2013 are disclosed in Note 35 to our consolidated financial statements.



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Impairment of Long-Lived Assets



During impairment testing
under U.S. GAAP, our management must make reasonable and supportable assumptions and estimates with respect to, among other factors,
(1) the market value of reserves, (2) oil fields’ production profiles and future production of refined and chemical products,
(3) future investments, taxes and costs, (4) future capital expenditures and useful life for properties and (5) future prices.
As such, any change in the variables used to prepare such assumptions and estimates may have a significant effect on the impairment
tests.



Financial Derivative Instruments



We may enter into hedging
agreements to reduce our exposure to the fluctuations of international crude oil and products prices. Under Colombian Government
Entity GAAP, amounts paid and income received under hedging operations is recognized as financial income/expense. We are not permitted
to enter into hedging contracts for speculative purposes according to the internal hedging guidelines issued by our Board of Directors.



Under Colombian Government
Entity GAAP, our estimates of the value of hedges made throughout the year are based on the spot prices for the date the hedge
was entered into, subject to market variations according to the regulation and methodology established by the Superintendency of
Finance.



As of December 31, 2013,
we did not have any such derivatives.



Pension Plans and Other Benefits



By virtue of Legislative
Act 01 of 2005, enacted by Congress, the pension regimes excluded from the General Social Security System in Colombia expired on
July 31, 2010. In accordance with provisions therein, the workers entitled to pensions were those workers who met the age and continuous
or discontinuous service time requirements of the law, the Collective Bargaining Agreement in force and/or Agreement 01 of 1977,
prior to August 1, 2010. Other workers who were not covered by those agreements must mandatorily be affiliated with the General
Pension System. The agency responsible for paying each worker’s pension is the pension administrator chosen by the worker
(either the governmental institution Colpensiones—formerly the Social Security Institute—or a private pension fund).



The determination of the
expense, liability and adjustments in memorandum accounts relating to our pension and other retirement benefits requires us to
use judgment in the determination of actuarial assumptions. These include the number of active employees with indefinite term contracts,
retirees and their heirs, pension benefits, healthcare and education expenses, the number of temporary employees who will remain
with us until retirement, voluntary retirement plans and pension bonuses. The calculation of retirement bonds posted by us to meet
our pension obligations is regulated by Decrees 1748 of 1995, 1474 of 1997 and 876 of 1998, as well as Law 100 of 1993 and its
regulatory decree. See Note 1 to our consolidated financial statements.



These actuarial assumptions
include estimates of future mortality, withdrawal, changes in compensation and discount rate to reflect the time value of money
as well as the rate of return on pension bonds and other plan assets. These assumptions are reviewed annually and may differ materially
from actual results due to changing market and economic conditions, regulatory events, judicial rulings, higher or lower withdrawal
rates or longer or shorter life spans of participants.



Actuarial gains and losses,
a result of differences between estimates and actual calculations and differences between Colombian Government Entity GAAP and
U.S. GAAP are disclosed in Note 35 to our consolidated financial statements. Changes in interest rates and amendments to plan conditions
have affected prior estimates. We believe that the assumptions used in recording our obligations under the plans are reasonable
based on our experience and market conditions. See Note 35of our consolidated financial statements for a sensitivity analysis.



-89-







Litigation and Tax Assessments



We are subject to claims
for substantial amounts, regulatory and arbitration proceedings, tax assessments and other claims arising in the normal course
of business. Management and legal counsel evaluate these situations based on their nature, the likelihood that they materialize,
and the amounts involved, to decide on any changes to the amounts accrued and/or disclosed. This analysis includes current legal
proceedings brought against us and claims not yet initiated. In accordance with management’s evaluation and guidance provided
by Colombian Government Entity GAAP, we created provisions to meet these costs when liability is probable and reasonable estimates
of the liability can be made. As of December 31, 2013, we had a provision of Ps$541,847 million for litigation contingencies. We
also maintain insurance policies to cover specific operational risks and asset protection.



Estimates are based on
legal counsel’s evaluation of the cases and management’s judgment. In the past, our estimates have been accurate and
have not varied substantially compared with final judgments. We believe that payments required to settle the amounts related to
the claims, in case of loss, will not vary significantly from the estimated costs, and thus will not have a material adverse effect
on our financial statements taken as a whole. Litigation and tax assessment differences between Colombian Government Entity GAAP
and U.S. GAAP are disclosed in Note 35 to our consolidated financial statements.



Income taxes are accounted
for under the assets and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable
to differences between the carrying amounts of existing assets and liabilities in our financial statements and their respective
tax base. Deferred taxes on assets and liabilities are calculated based on statutory tax rates that we believe will be applied
to our taxable income during the years in which temporary differences between the carrying amounts are expected to be recovered.



Abandonment of Fields



Upon completion of
our work at a production site, we are required by law to remove equipment and restore disturbed land or seabeds. To estimate
the cost of this obligation, we include plugging costs and the costs of abandonment of wells, dismantling of facilities and
environmental recovery of the areas and wells. Changes resulting from
new estimates of the liability for abandonment can occur as a result of changes in economic conditions. We accrue the
estimated discounted costs of dismantling and removing these facilities at the time of installation of the assets.



We use economic factors
from different sources and develop our own internal estimates of future inflation rates and discount rates. There have not been
significant disparities between estimates and asset retirement costs paid. We believe that the assumptions used in recording our
asset retirement costs and obligations are reasonable based on our experience and market conditions. The related liability is estimated
in local currency and does not require adjustment for a difference in exchange rates at the end of each year as a greater or lesser
value of assets.



Differences between Colombian
Government Entity GAAP and U.S. GAAP in the accounting for costs of abandoning fields are disclosed in Note 35 to our consolidated
financial statements.



Recognition and Measurement of
Assets Recognized and Liabilities Assumed upon Business Combinations



Under U.S. GAAP, we account
for businesses acquired using the purchase method of accounting, which requires that the assets acquired and liabilities assumed
be recorded at the date of acquisition at their respective fair values. Under Colombian Government Entity GAAP, by contrast, the
assets acquired and liabilities assumed are recognized at book value. The application of the purchase method requires certain estimates
and assumptions of the fair values of the acquired intangible assets, property, plant and equipment as well as the liabilities
assumed at the date of the acquisition. The same is true of the useful lives of the acquired intangible assets, property, plant
and equipment. The judgments made in the context of the purchase price allocation can materially impact our future results of operations.
Accordingly, for significant acquisitions, we obtain assistance from third-party valuation specialists. The valuations are based
on information available at the acquisition date and different methodologies are used for the calculation of intangibles.



-90-







Goodwill





Under U.S. GAAP, we test goodwill for impairment
at least annually using a two-step process that begins with an estimate of the fair value of a reporting unit. The first step is
a screen for potential impairment and the second step measures the amount of impairment, if any. However, if certain criteria are
met, the requirement to test goodwill for impairment annually can be satisfied without a remeasurement of the fair value of a reporting
unit. Fair value is determined by reference to market value, if available, or by a qualified evaluator or pricing model. Determination
of a fair value by a qualified evaluator or pricing model requires management to make assumptions and use estimates. Management
believes that the assumptions and estimates used are reasonable and supportable in the existing market environment and commensurate
with the risk profile of the assets valued. However, different assumptions and estimates could be used which would lead to different
results. The valuation models used to determine the fair value of these companies are sensitive to changes in the underlying assumptions.
For example, the prices and volumes of product sales to be achieved and the prices which will be paid for the purchase of raw materials
are assumptions which may vary in the future. Adverse changes in any of these assumptions could lead us to record a goodwill impairment
charge. See Notes 13 and35 to our consolidated financial statements.



Under Colombian Government Entity GAAP,
goodwill corresponds to the difference between the acquisition price and the book value of the acquired company. This amount is
amortized during the period in which the Company expects to receive future benefits. In addition, it is subject to an annual impairment
test, applying the fair value methodology established by U.S. GAAP.



Operating
Results



The following discussion
is based on information contained in our audited consolidated financial statements and should be read in conjunction therewith.
Our consolidated financial statements have been prepared in accordance with Colombian Government Entity GAAP, which differs in
certain significant respects from U.S. GAAP. See Note 35 to our consolidated financial statements for a description of the principal
differences.



Certain line items from
our consolidated financial statements as of December 31, 2012 and 2011 related to the presentation and the Consolidated Statement
of Financial, Economic, Social and Environmental Activities have been reclassified in order to make the presentation of such financial
statements comparable to that of our financial statements as of December 31, 2013. The principal reclassifications were under operational
expenses, particularly (1) amounts for inventory, property, plant and equipment, litigation and accounts receivable and (2) equity
tax.



Results of Operations for the Year Ended
December 31, 2013, Compared to the Year Ended December 31, 2012, and Compared to the Year Ended December 31, 2011



The following table sets
forth components of our income statement for the years ended December 31, 2013, 2012 and 2011.



-91-







|                                |  | For the Year ended December 31, |            |  | 2013/2012 % change |  |            | For the Year ended December 31, 2011 |  |  | 2012/2011 % change  |   
|------------------------------- |  | ------------------------------- | ---------- |  | ------------------ |  | ---------- | ------------------------------------ |  |  | ------------------- | --
|                                |  | 2013                            |            |  | 2012               |  |            |                                      |  |  | (Pesos in millions) |   
|                                |  | (Pesos in millions)             |            |  |                    | 
|Revenues                        |  |                                 |            |  |                    |  |            |                                      |  |  |                     |   
|                                |  |                                 |            |  |                    |  |            |                                      |  |  |                     |   
|Total Revenue                   |  |                                 | 70,428,714 |  |                    |  | 68,852,002 |                                      |  |  | 2                   | % 
|                                |  |                                 |            |  |                    |  |            |                                      |  |  |                     |   
|Cost of Sales                   |  |                                 | 42,554,282 |  |                    |  | 40,535,508 |                                      |  |  | 5                   | % 
|Gross Profit                    |  |                                 | 27,874,432 |  |                    |  | 28,316,494 |                                      |  |  | (2                  | )%
|                                |  |                                 |            |  |                    |  |            |                                      |  |  |                     |   
|Operating Expenses              |  |                                 | 6,039,703  |  |                    |  | 4,973,590  |                                      |  |  | 21                  | % 
|Operating Income                |  |                                 | 21,834,729 |  |                    |  | 23,342,904 |                                      |  |  | (6                  | )%
|                                |  |                                 |            |  |                    |  |            |                                      |  |  |                     |   
|Non-operating income (expenses) |  |                                 | 47,478     |  |                    |  | (1,011,203 | )                                    |  |  | n.m.                | % 
|Income before income tax        |  |                                 | 21,882,207 |  |                    |  | 22,331,701 |                                      |  |  | (2                  | )%
|                                |  |                                 |            |  |                    |  |            |                                      |  |  |                     |   
|Income tax                      |  |                                 | 8,088,838  |  |                    |  | 7,133,395  |                                      |  |  | 13                  | % 
|Non-controlling interest        |  |                                 | 686,866    |  |                    |  | 419,359    |                                      |  |  | 64                  | % 
|                                |  |                                 |            |  |                    |  |            |                                      |  |  |                     |   
|Net Income                      |  |                                 | 13,106,503 |  |                    |  | 14,778,947 |                                      |  |  | (11                 | )%



Total Revenues — Consolidated



Methodology



In this section, including
the table below, all of our financial information is presented by segment as follows:



| | · | Exploration and Production – includes our crude oil and natural gas exploration and production
and natural gas transportation activities. Revenue is derived from inter-company, exports, local and third-party sales. Costs
and expenses for this segment include those costs incurred by us from the production field to the end customer. This segment also
includes purchase of crude oil and gas from ANH and other third parties for resale. Operating expenses include all exploration
costs that are not capitalized.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Refining and Petrochemicals – includes our refining activities. Revenue is derived from
inter-company, exports, local and third-party sales and corresponds to sales of products processed in our refineries and our downstream
subsidiaries such as motor fuels, fuel oils and petrochemicals at market prices. This segment also includes other services sold
to third-parties.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Transportation and Logistics – includes our sales and costs associated with our
crude oil pipelines and other transportation activities in relation to crude oil and refined products.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Our reporting segments have changed since
the first quarter of 2013, when we eliminated the marketing and supply segment. This change was made because of the marginal role
of the segment with respect to our core business and the support role of marketing and supply to other segments, making it possible
to attribute marketing and supply to the other segments. Therefore, the activities of marketing and supply have been reclassified
to exploration and production, refining and transportation segments for the years 2012 and 2011.



We use the following criteria to analyze
our financial information by business segment: (1) third party sales are made at market prices by each segment according to their
ownership of the products or services sold; (2) each segment bears costs and expenses incurred for production and marketing of
its products, the corresponding administrative expenses and those expenses related to non-operational transactions related to its
activity; (3) transactions between segments are accounted for as if each segment were a separate entity and prices between
segments are determined by reference to those that could be obtained in transactions with third parties. See the income statement
by segment in note 35 of our consolidated financial statements.



-92-







The following table sets forth our principal
sources of revenue by business segment for the years ended December 31, 2013, 2012 and 2011.



|                                                                                    |  | For
    the Year ended December 31, |            |   | 2013/2012%
    change |  |            | For
    the Year ended December 31, 2011 |  |  | 2012/2011
    % change |   
|----------------------------------------------------------------------------------- |  | ----------------------------------- | ---------- | - | --------------------- |  | ---------- | ---------------------------------------- |  |  | ---------------------- | --
|                                                                                    |  | 2013                                |            |   | 2012                  |  |            |                                          |  |  | (Pesos in millions)    |   
|                                                                                    |  | (Pesos in millions)                 |            |   |                       | 
|Exploration
    and Production Segment:                                             |  |                                     |            |   |                       |  |            |                                          |  |  |                        |   
|Crude
    oil:                                                                      |  |                                     |            |   |                       |  |            |                                          |  |  |                        |   
|Local sales                                                                         |  |                                     | 1,459,410  |   |                       |  | 842,975    |                                          |  |  | 73.1                   | % 
|Export
    sales (1)                                                                |  |                                     | 40,505,921 |   |                       |  | 41,129,261 |                                          |  |  | (1.5                   | )%
|Total
    sales of crude oil                                                        |  |                                     | 41,965,331 |   |                       |  | 41,972,236 |                                          |  |  | 0.0                    | % 
|Natural
    gas:                                                                    |  |                                     |            |   |                       |  |            |                                          |  |  |                        |   
|Local sales                                                                         |  |                                     | 1,263,192  |   |                       |  | 1,114,876  |                                          |  |  | 13.3                   | % 
|Other income                                                                        |  |                                     | 274,144    |   |                       |  | 278,013    |                                          |  |  | (1.4                   | )%
|Export
    sales                                                                    |  |                                     | 620,077    |   |                       |  | 606,011    |                                          |  |  | 2.3                    | % 
|Total
    sales of natural gas                                                      |  |                                     | 2,157,412  |   |                       |  | 1,998,900  |                                          |  |  | 7.9                    | % 
|Other
    income from production segment (2)                                        |  |                                     | 254,471    |   |                       |  | 488,743    |                                          |  |  | (47.9                  | )%
|Total
    exploration and production segment sales                                  |  |                                     | 44,377,215 |   |                       |  | 44,459,879 |                                          |  |  | (0.2                   | )%
|Exploration
    and production segment eliminations in consolidation                |  |                                     | (4,782,810 | ) |                       |  | (5,389,573 | )                                        |  |  | (11.3                  | )%
|Total
    exploration and production segment sales to third parties                 |  |                                     | 39,594,405 |   |                       |  | 39,070,306 |                                          |  |  | 1.3                    | % 
|Refining  and
    Petrochemical segment:                                            |  |                                     |            |   |                       |  |            |                                          |  |  |                        |   
|Refined
    Products:                                                               |  |                                     |            |   |                       |  |            |                                          |  |  |                        |   
|Local sales (3)                                                                     |  |                                     | 20,691,650 |   |                       |  | 20,156,511 |                                          |  |  | 2.7                    | % 
|Sales of refined products
    allocated to our production segment (4)               |  |                                     | (197,388   | ) |                       |  | (279,072   | )                                        |  |  | (29.3                  | )%
|Other income from local
    sales of services of Refining and Petrochemical Segment |  |                                     | 202,323    |   |                       |  | 52,584     |                                          |  |  | 284.8                  | % 
|Export sales                                                                        |  |                                     | 7,762,069  |   |                       |  | 8,016,685  |                                          |  |  | (3.2                   | )%
|Total
    refining and Petrochemicals segment sales:                                |  |                                     | 28,458,654 |   |                       |  | 27,946,708 |                                          |  |  | 1.8                    | % 
|Refining
    segment eliminations in consolidation                                  |  |                                     | (136,479   | ) |                       |  | (88,389    | )                                        |  |  | 54.4                   | % 
|Total
    Refining segment sales to third parties                                   |  |                                     | 28,322,175 |   |                       |  | 27,858,319 |                                          |  |  | 1.7                    | % 
|Transportation
    and Logistics segment:                                           |  |                                     |            |   |                       |  |            |                                          |  |  |                        |   
|Transportation sales (5)                                                            |  |                                     | 5,573,107  |   |                       |  | 2,431,938  |                                          |  |  | 129.2                  | % 
|Other income transportation
    services                                            |  |                                     | 229,509    |   |                       |  | 461,029    |                                          |  |  | (50.2                  | )%
|Total
    transportation sales                                                      |  |                                     | 5,802,616  |   |                       |  | 2,892,967  |                                          |  |  | 100.6                  | % 
|Transportation
    and Logistics segment eliminations in consolidation (5)          |  |                                     | (3,290,482 | ) |                       |  | (969,590   | )                                        |  |  | 239.4                  | % 
|Total
    Transportation and Logistics segment sales to third parties               |  |                                     | 2,512,134  |   |                       |  | 1,923,377  |                                          |  |  | 30.6                   | % 
|Total
    sales (6)                                                                 |  |                                     | 70,428,714 |   |                       |  | 68,852,002 |                                          |  |  | 2.3                    | % 








n.m. = Not meaningful.

| | (1) | Crude oil sales to Reficar are accounted for as export sales because of Reficar’s operations
in the Free Trade Zone. These sales, which are inter company sales, are eliminated in consolidation.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | Corresponds to sales of refined products and services allocated to our exploration and production
segment.
| | --- | ----------------------------------------------------------------------------------------------------------

| | (3) | Includes entitlements to gasoline and diesel price differential reimbursements by the Nation amounting
to Ps$938.7 billion for 2013, Ps$809.7 billion for 2012 and Ps$2,251 billion for 2011.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (4) | Corresponds to sales of refined products from our Apiay and Orito refineries allocated to our exploration
and production segment.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------

| | (5) | The increase in sales in 2013 was due to the change from a cost- to profit-center model for Oleoducto
Central (Ocensa) and Oleoducto de Colombia (ODC). Under the new model, the pipelines charge market tariffs to all customers, including
our other segments, as required by regulations promulgated by the Ministry of Mines and Energy.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (6) | Because of the elimination of the marketing and supply segment, certain figures for the years ended
December 31, 2012 and 2011 were reclassified so that they are comparable with those for the year ended December 31, 2013.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-93-







In 2013, total revenues increased by 2.3%
as compared with 2012, mainly due to (1) an increase of 1.3% in revenues from sales of crude and gas sales to third parties, which
in turn resulted from higher local sales of crude oil and natural gas that more than offset a small decline in crude oil exports
and lower average prices in U.S. dollars; (2) higher local sales of gasolines and medium distillates due to an increase in
local demand for these products and (3) a 30.6% increase in the transportation segment sales to third parties due to the change
in the business models of ODC and Ocensa from cost to profit centers. Revenues were also positively affected by the depreciation
of Peso against U.S. dollar in a magnitude different than the 3.9% average depreciation of the Peso against the U.S. dollar in
2013 because our export sales were not evenly spread throughout the year. In 2012, total revenues increased by 4.4% when compared
with 2011 mainly due to higher prices of the crude oil basket, supported primarily by the higher Brent and Maya benchmarks prices.



The following table sets
forth our total export and local sales of crude oil, natural gas and refined products for the years ended December 31, 2013, 2012
and 2011.



|                                                                     |  | For the Year ended December 31, |             |  | 2013/2012 |  | For the Year ended December 31, |          | 2012/2011 |     
|-------------------------------------------------------------------- |  | ------------------------------- | ----------- |  | --------- |  | ------------------------------- | -------- | --------- | ----
|                                                                     |  | 2013                            |             |  | 2012      |  |                                 | % change |           | 2011
|Crude oil:                                                           |  |                                 |             |  |           |  |                                 |          |           |     
|Local sales (barrels)                                                |  |                                 | 9,925,751   |  |           |  | 4,621,107                       |          |           |     
|Export sales (barrels)                                               |  |                                 | 190,106,364 |  |           |  | 192,216,579                     |          |           |     
|Average price per local barrel (in U.S. dollars)(1)                  |  |                                 | 61.73       |  |           |  | 68.95                           |          |           |     
|Average price per export barrel (in U.S. dollars) (2)                |  |                                 | 100.79      |  |           |  | 103.93                          |          |           |     
|Weighted average price per local and export barrel (in U.S. dollars) |  |                                 | 98.85       |  |           |  | 103.11                          |          |           |     
|                                                                     |  |                                 |             |  |           |  |                                 |          |           |     
|Natural gas:(3)                                                      |  |                                 |             |  |           |  |                                 |          |           |     
|Local sales (barrels equivalent)                                     |  |                                 | 27,277,037  |  |           |  | 24,702,562                      |          |           |     
|Export sales (barrels equivalent)                                    |  |                                 | 9,976,846   |  |           |  | 9,924,841                       |          |           |     
|Average local price (barrels)  (in U.S. dollars)(1)                  |  |                                 | 24.62       |  |           |  | 24.96                           |          |           |     
|Average export price (barrels) (in U.S. dollars)(2)                  |  |                                 | 33.55       |  |           |  | 34.51                           |          |           |     
|                                                                     |  |                                 |             |  |           |  |                                 |          |           |     
|Refined products:                                                    |  |                                 |             |  |           |  |                                 |          |           |     
|Product local sales (barrels)                                        |  |                                 | 94,683,145  |  |           |  | 92,890,866                      |          |           |     
|Export sales (barrels)                                               |  |                                 | 41,997,257  |  |           |  | 41,880,845                      |          |           |     
|Average local price per barrel (U.S. dollars)(1)                     |  |                                 | 116.92      |  |           |  | 118.83                          |          |           |     
|Average export price per barrel (U.S. dollars)(2)                    |  |                                 | 99.10       |  |           |  | 107.88                          |          |           |     










| | (1) | Corresponds to average price per local barrel translated at an average exchange rate of Ps$1,869.10
to US$1.00 for 2013.Ps$1,798.23 to US$1.00 for 2012 and Ps$1,848.17 to US$1.00 for 2011.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | Corresponds to the average of the actual prices at which we sold our products in the international
markets.
| | --- | -----------------------------------------------------------------------------------------------------------

| | (3) | As of the end of 2013, we began reporting the gas volume sales in barrels equivalent, in order
to provide consistency within the different figures during the year that vary in terms of the relationship between thermal units
and volumes in each field. For year 2013, conversion factors oscillated in the range of 5.6 and 7.0 mbtu per barrel. For years
2012 and 2011, the figures were converted using a conversion factor of 5.9 mbtu per barrel.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(4) The
difference with respect to the variation reported in our Form 20-F for the 2012 fiscal year, relates to the inclusion of natural
gas sales from the Free Trade Zone in 2012, which were not previously reflected in export sales.



-94-







Cost and Expenses — Consolidated



The following table sets
forth elements of our cost of sales, operating expenses and operating income for the years ended December 31, 2013, 2012 and 2011.



|                   |  | For the Year ended December 31, |            |  | 2013/2012           |  | For the Year ended December 31, |          | 2012/2011 |     
|------------------ |  | ------------------------------- | ---------- |  | ------------------- |  | ------------------------------- | -------- | --------- | ----
|                   |  | 2013                            |            |  | 2012                |  |                                 | % change |           | 2011
|                   |  | (Pesos in millions)             |            |  | (Pesos in millions) |  |                                
|Cost of sales      |  |                                 | 42,554,282 |  |                     |  | 40,535,508                      |          |           |     
|Operating expenses |  |                                 | 6,039,703  |  |                     |  | 4,973,590                       |          |           |     
|Operating Income   |  |                                 | 21,834,729 |  |                     |  | 23,342,904                      |          |           |     



Cost of Sales — Consolidated



Our cost of sales was affected by the main
factors that are decribed below. See Note 25 of our consolidated financial statements for more detail.



| | · | Purchases of crude oil and gas from the ANH in 2013 decreased 9.7% to Ps$7,808,844 million compared
with 2012 as a result of (1) lower purchase prices which are indexed to our average export prices of both crude oil and gas and
(2) a decrease in the volumes of gas purchased in line with the mandate signed with ANH in mid-2012. As a result of Decree 2100
of 2011, other companies are also able to purchase gas directly from the ANH. Since July 2012, in compliance with this Decree,
and as a result of the agreement signed with ANH, Ecopetrol S.A. no longer purchases the total gas royalties from ANH, but only
commercializes part of them. In 2012 purchases increased 7.4% to Ps$8.646.762 million compared with 2011 mainly as a result of
higher purchase prices and an increase in the volumes purchased, because of increased production of crude oil (and consequently
royalties) in Colombia.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Purchases of imported products in 2013 increased 25.6% to Ps$11,862,265 million compared with 2012
and 6.9% in 2012 to Ps$9,447,041 million compared with 2011, as a result of (1) higher volumes of naphtha purchased for blending
with increasing heavy crude oil production, (2) higher volumes of products (mainly ultra low sulfur diesel) for blending with our
local production to meet local environmental regulations regarding sulfur content in diesel and (3) higher purchases of petrochemicals
and industrial products, particularly polyethylene and lubricant bases, to fulfill our obligations under commercial agreements
in the local market.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Purchases of crude oil from third parties in 2013 decreased 19.4% to Ps$5,805,854 million compared with
2012 mainly as a result of lower transportation availability for Ecopetrol S.A. in the Ocensa pipeline. In 2012 purchases increased
7.6% compared with 2011 to Ps$7,207,707 million, mainly as a result of higher average prices and an increase in the volumes purchased.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Services contracted with associations, which are pro rata expenses for our joint ventures, increased 13.0%
in 2013 to Ps$2,294,667 million compared with 2012, and 13.8% to Ps$2,031,281 million in 2012 compared with 2011, mainly due to
the growth in production. This increase resulted mainly from higher costs of subsoil maintenance and water treatment due to higher
bottom sediment contained in crude oil.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Maintenance costs increased 16.6% to Ps$2,240,543 million compared with 2012, due to the integrity
program for the reliability of transport infrastructure, which has been in the process of implementation since the second quarter
of 2012 and will run until 2016. In addition, higher repair costs for pumping systems and higher maintenance costs for recovery
of production after attacks on transportation infrastructure, also contributed to higher maintenance costs. Maintenance costs
in 2012 increased 22.4% to Ps$1,921,008 million compared with 2011, mainly due to the relocation and replacement of our transmission
lines pursuant to our integrity program. Higher costs related to the repair and coating of pipes of existing wells as a result
of the heavy rain season also contributed to the increase.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | · | Labor costs in 2013 increased 15.1% to Ps$1,260,436 million from 2012, mainly due to a 10.2% growth
in the number of employees, and an increase of 3.7% in their salaries. Labor costs increased by 9.4% to Ps$1,095,495 million in
2012 as compared with 2011 as a result of a 10.6% increase in headcount of employees, due to an increase in our operations and
projects.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Depreciation costs decreased 3.1% to Ps$1,828,228 million in 2013 as a result of a revised useful
life of transportation assets. In 2012, depreciation costs increased 4.3% to Ps$1,886,620 as compared with 2011, mainly due to
additional investments in transportation systems.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Services contracted with third parties in 2013 increased 20.3% to Ps$1,356,452 million compared with
2012 and 30.6% in 2012 to Ps$1,127,284 million as compared with 2011. Both increases were mainly the result of a rise in, particularly,
leasing, professional, technological and, surveillance services due to increased exploration activity. In addition, in 2013, there
was an increase in professional services for the pipeline integrity program that began in the second quarter of 2012.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Operating Expenses — Consolidated



In 2013, our operating expenses increased
by 21% as compared with 2012, mainly as a result of the following factors. See Note 26 of our consolidated financial statements
for more detail.



| | · | A net 104.2% growth in provision expenses to Ps$650,660 million primarily due to an increase in the
calculation of pension liabilities as well as the lower profitability of the portfolios of trust funds linked to the pension obligations
of the company (PAP), and, on the other hand, a recovery in provisions for litigation.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | A total of Ps$353,012 million recognized as impairment of goodwill for Offshore International Group
and Polipropileno del Caribe S.A.
| | - | -------------------------------------------------------------------------------------------------------------------------------------



| | · | An increase in overhead operational expenses of 34.4% to Ps$1,143,615 million compared with 2012 due
to (1) additional agreements signed with the national army and police force to guarantee the normal course of operation at pipelines
and facilities, (2) higher freight and customs charges on foreign sales and (3) the execution of social investment agreements,
which aim to improve the social conditions of the communities where we develop our operations.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | An increase of 3% in taxes to Ps$988,447million mainly due to: (1) the growth in payments of industry
and trade tax (stemming from an increase in local sales), (2) an increase in payments of the financial transaction tax due to increased
dividends and loan payments, and (3) the increase of 70.4% to Ps$95,062 million in the fee charged by the General Comptroller Office,
which it receives from all entities surveyed by its audit function.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In 2012, our operating
expenses increased by 18% from 2011, mainly as a result of the following factors:



| | · | An increase in net provisions of 126% to Ps$318,629 million mainly due to the valuation of property, plant
and equipment. As required by Colombian Government Entity GAAP, the valuation of assets must be performed every three years and
2012 was one such year. This process involves the comparison between the net book value and a technical value for a specific asset.
The result of such exercise was a provision for the impairment of some assets, mainly for buildings and transportation equipment
from the exploration and production segment and the transportation segments.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Labor expenses for operating and projects increased by 46% to Ps$277,430 million mainly due to lower capitalizations
of expenses made because of the activation of some projects in 2012 compared to 2011.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | An increase in exploration expenses of 48%, to Ps$1,419,530 million primarily as a result of seismic studies
and dry well expenses from unsuccessful explorations.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------



-96-







| | · | An increase in overhead operational expenses of 10% to Ps$850,757 million, primarily as a consequence
of additional agreements signed with the national police force as a strategy to ensure the normal course of operations at pipelines
and facilities. This entry was also affected by higher freight and customs charges on foreign sales.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Each segment bears the
costs and expenses incurred for product use and marketing and each segment assumes administrative expenses and all non-operational
transactions related to its activity. Discussion of operating expenses by business segment is included in the segment discussion
below.



Exploration and Production Segment Results



Exploration and Production Segment
Sales



Crude Oil



Local Sales



Our revenues from local
sales of crude oil increased by 73.1% in 2013 compared with 2012 mainly due to a 114.8% increase in volumes sold as a consequence
of limited crude export sales which shifted the sales mix toward local sales. The shift to increased local sales occurred because
of lower transportation capacity for export, due to the shift by Ocensa and ODC to profit center models, and in consequence, less
flexibility for Ecopetrol S.A to use additional capacity in Ocensa pipeline.



In 2012, our revenues
from local sales of crude oil increased by 83% as compared with 2011, mainly due to a 159.1% increase in volumes sold, especially
of the Rubiales blend as a consequence of higher demand of crude oil from shipping companies.



Export Sales



Our revenues from exports
of crude oil decreased by 1.5% in 2013 as compared with 2012, mainly due to a 3.0% decrease in the average export price per barrel
explained primarily by the lower Brent and Maya benchmarks prices. In 2013, 95% of the crude basket was indexed to the Brent and
Maya benchmarks. The decrease in prices, however, was mitigated somewhat by the increase of the average exchange rate of Peso against
the U.S. dollar. Additionally, export volumes decreased by 1.1% primarily due to restrictions in pipeline transportation capacity,
due to less flexibility of Ecopetrol S.A to use additional capacity in Ocensa pipeline.



In 2012, our revenues
from exports of crude oil increased by 5.9% as compared with 2011 mainly due to a 4.4% increase in the average export price per
barrel and a 5.9% increase in the volume of export sales which were partially offset by the 2.7% negative effect of the appreciation
of the Peso against the U.S. dollar. Increased export sales resulted from improvements in our transportation capacity and higher
production of Vasconia and Magdalena blends.



Natural Gas



Local Sales



In 2013, revenues from
local sales of natural gas increased by 13.3%, mainly due to an increase in natural gas production (mainly in the Cupiagua and
Guajira fields), which led to an increase of 10.4% in the volume of local sales. Higher production was due to an increase in the
demand of natural gas in 2013 from the thermoelectric sector. The local average price in Pesos ($46,013 Pesos equivalent to US$24.62/barrel
in 2013) increased by 2.6% from 2012 to 2013, contributing to increased local sales revenue.



In 2012, our revenues
from local sales of natural gas decreased by 8.4% from 2011. This revenue drop was caused principally by a 4.9% decrease in the
volumes sold, in part due to lower gas purchases from the ANH, pursuant to Decree 2100 of 2011, according to which other companies
are also able to purchase gas directly from ANH, as well as a 3.8% decrease in the average local prices in Pesos currency in 2012
($ 44,878 Pesos, equivalent to US$24.96/barrel) compared with 2011.



-97-







Export Sales



In 2013, export sales
of natural gas increased by 2.3% as compared with 2012, despite a 2.8% decrease in average export prices in U.S. dollars. This
was due principally to: (1) a 0.5% increase in volumes sold as a result of higher production of natural gas available for export
sale (mainly from the Guajira Field) and increased volumes exported to Venezuela because of higher demand and (2) the positive
effect of the 3.9% average depreciation of the Peso against the U.S. dollar.



In 2012, export sales
of natural gas increased by 9.3% as compared with 2011, principally due to a 17.7% increase in our average export prices. However,
the price increase was partially offset by a 2.1% decrease in volumes sold, mainly due to: (1) higher domestic thermal demand,
and in consequence less availability for export sale, and (2) the delayed start of new projects related to natural gas production
mainly in Guajira field. In addition, export sales were negatively impacted by the effect of the appreciation of the Peso against
the U.S. dollar.



Total Exploration and
Production Segment Sales to Third Parties





In 2013 and 2012, our total exploration
and production segment sales to third parties increased by 1.3% and 8.6%, respectively in each case as compared with the prior
year principally due to an increase in volumes produced and sold. A positive impact was generated as well on export sales in 2013
due to the average depreciation of the exchange rate of the Peso against the U.S. dollar.





Exploration and Production Segment’s
Cost of Sales



Cost of sales affecting
our exploration and production segment is mainly related to: (1) the amortization and depletion of our production assets, (2) contracted
services in association contracts, and (3) maintenance, project and labor costs related to this segment. In addition, this segment’s
costs were impacted by imported naphtha and transportation services.



In 2013, the cost of sales
for this segment decreased by 2.8% compared with 2012, due to a 4.9% decrease in variable costs (which themselves represent 80%
of the total cost). This decrease corresponds to (1) a lower volume of crude oil purchased from third parties due to transport
capacity restrictions mainly on the pipelines located on the southern region and (2) lower prices on the crude purchased from ANH
as consequence of negotiations. On the other hand, fixed costs increased by 5.3% mainly due to: (1) higher depreciation, depletion
and amortization mainly in the Castilla and Chichimene fields and (2) increased costs of subsoil maintenance and water disposal
as well as an increase in the usage of additional chemical products for the treatment of basic sediments and water principally
at the Rubiales and Quifa fields.



In 2012, cost of sales
for this segment increased by 25.8% mainly due to an increase in cost of imported and locally purchased naphtha necessary to dilute
and transport heavy crude oil, and an increase in contracted services in association with contracts at the Rubiales and Quifa fields,
resulting from higher subsoil activities and water treatment.



Exploration and Production Segment’s
Operating Expenses



The operating expenses
of our exploration and production segment are primarily for: (1) research studies and projects, (2) expenses as a result of dry
wells and (3) the amortization of the goodwill from our acquisitions.



These expenses increased
by 11.2% in 2013 as compared with 2012 mainly due to a higher provision for the payment of pensions by Ecopetrol S.A., as well
as higher costs of research studies and projects due to an increase in exploration activities. In addition, in 2013 we recognized
an impairment of goodwill for Offshore International Group. In 2012, these expenses increased by 26.3% compared with the prior
year mainly due to the higher provisions for property, plant and equipment generated by revaluation of property, plant and equipment.



-98-







Refining and Petrochemicals Segment Results



Refining and Petrochemicals Segment
Sales



Local Sales





In 2013, local sales of refined products
and petrochemicals increased by 2.7% as compared with 2012, as a result of: (1) a 1.9% increase in volumes sold due to higher demand
for gasoline and middle distillates from the automotive, aviation and mining sectors and (2) a 0.7% increase in average prices
in Pesos (to $218,536 Pesos in 2013 equivalent to US$116.92/barrel) due to the effect of the rise in the international prices to
which the sale of our products is indexed.



Local sales of petrochemicals and refined
products increased 1.1% in 2012 from 2011 as a result of a 2.2% increase in volumes sold resulting from higher demand for refined
products from the automotive, aviation and mining sectors. The growth in volumes was partially offset by a decrease in the average
prices in Pesos of 1.0%.



Export Sales



In 2013 export sales of
refined products and petrochemicals decreased by 3.2% from 2012 mainly due to a decrease in average export prices of 8.1% resulting
mainly from: (1) a 7.3% decrease in the international price of fuel oil, to which our refining export products are indexed and
(2) a change in the mix of the products exported. With respect to the latter factor, in 2013 exported products had a higher proportion
of lower value products (e.g., fuel oil) than the mix of product sold in 2012. The decrease was partially offset by a 0.3%
increase in the volumes sold and the depreciation of the average exchange rate of Peso against the U.S. dollar.



Export sales of refined
products and petrochemicals decreased by 6.6% in 2012 from 2011 due to a 4.0% decrease in the average export prices of our products
basket in U.S. dollars in line with the behavior of international prices, which was partially offset by an increase of 2.7% in
volumes sold. In addition export sales in 2012 were negatively impacted by the appreciation of the Peso against the U.S. dollar.



Total Refining and Petrochemicals
Segment Sales to Third Parties



In 2013 total refining
and petrochemicals segment sales to third parties increased by 1.7% as compared with 2012 mainly as a result of the higher demand
for gasoline and middle distillates from the automotive, aviation and mining sectors.



Total refining and petrochemicals
segment sales to third parties decreasedby 1.5% in 2012 as compared with 2011 mainly as a result of lower export sales
of gasoline, diesel and fuel oil in line with the 4.0% decrease in average export prices of refined products in U.S. dollars due
to the behavior of international prices.



Refined Products and Petrochemicals
Segment’s Cost of Sales



The cost of sales for
our refined products and petrochemicals segment is mainly related to the purchase of crude oil and natural gas for our refineries,
imported products for the refining process, feed stock transportation services, services contracted for refinery maintenance and
the amortization and depreciation of refining assets.





In 2013, the cost of sales for this segment
decreased 0.7% compared with 2012 due to a 1.4 % decrease in variable costs (93% of total costs), mainly due to the reduction in
throughput of Barrancabermeja refinery as a result of crude unit U-250’s scheduled shutdown and lower availabilityof light
crudes. On the other hand, fixed costs increased by 9.6%, primarily as a consequence of the tax reform, which made us assume a
higher burden of VAT.



In 2012, cost of sales
for this segment increased 3.7% compared with 2011, principally due to an increase in the cost of imported products and crude oil
purchased from the ANH and third parties, offset by a decrease in crude oil purchased from our Exploration and Production segment
to upload to our refineries.



-99-







Refining and Petrochemicals Segment’s
Operating Expenses



The operating expenses
of our refining and petrochemicals segment are projects and administrative expenses assigned to this segment. In 2013, operating
expenses increased by 75.1% as compared with 2012 mainly due to a higher provision for the calculation of the pension liabilities
in Ecopetrol SA. In 2012, operating expenses decreased by 7.2% compared with 2011, mainly due to the lower taxes and overhead assigned
to this segment. In addition, in 2013 we recognized an impairment of goodwill for Propilco.



Transportation and Logistics Segment
Results



Transportation and Logistics Segment
Sales



In 2013, our transportation
and logistics segment sales increased by 100.6% compared with 2012 mainly due to the new profit-center model for the segment. Sales
also increased as a result of an increase in the transported volume of crude oil associated with higher crude oil production in
Colombia and the higher volume of products transported, mainly as a result of higher volumes of naphtha transported to dilute heavy
crude oil.



Total transportation sales
increased by 13.7% in 2012 as compared with 2011, mainly due to the higher volume of crude oil transported, which was associated
with (1) higher crude oil production in Colombia and (2) higher volume of products, mainly as a result of higher volumes of naphtha
transported to dilute heavy crude oil. The segment sales were positively impacted as well by the revision of applicable tariffs
charged per transported barrel approved by the Ministry of Mines and Energy. which increased 3.7% compared with the 2011 tariff.



Transportation and Logistics
Segment Sales to Third Parties



Our transportation and
logistics segment sales to third parties increased by 30.6% in 2013 compared with 2012 mainly due to the new profit-center model
for Ocensa and ODC and the higher volume of crude oil produced by companies in Colombia that created additional demand for transportation
services.





Likewise, in 2012, higher production in
Colombia increased transported volumes, which, after accounting for the effects of consolidation, increased segment sales to third
parties by 12.6% in 2012 compared with 2011.







Transportation and Logistics Segment’s
Cost of Sales



The cost of sales for
our transportation and logistics segment is mainly related to: (1) project costs which relate to costs associated with the maintenance
of transportation networks and (2) the construction and conversion of existing pipelines for the transportation of heavy crude
oil.



The cost of sales for
this segment increased by 19.2% in 2013 as compared with 2012 principally due to a 58.5% change in variable costs as a result of
an increase in transported volumes (especially of heavy crude oil). Fixed costs increased 13.7% mainly due to an increase in the
costs associated with the development of our pipeline integrity program



The cost of sales for
this segment increased by 25.6% in 2012 as compared with 2011 mainly due to the higher maintenance and contracted services costs
associated with the development of our pipeline integrity program. See “Item 4. Information on the Company—Overview
by Business Segment—Transportation and Logistics—Summary.”



Transportation and Logistics Segment’s
Operating Expenses



The operating expenses
of our transportation and logistics segment result primarily from projects to improve our transportation system and the amortization
of the goodwill from acquisitions assigned to this segment.



-100-







In 2013, operating expenses
decreased by 20.3% compared with 2012 due to different capitalization criteria of Ecopetrol S.A. and Cenit for transportation assets
when, as part of the transfer of assets to Cenit, Cenit recognized expenses as part of property, plant and equipment. In 2012,
operating expenses increased by 23.2% compared with 2011, largely as a result of expenses related to transportation and logistics
activity from the improved pipelines.



Non-Operating Income (Expenses)



The following table sets
forth our non-operating income (expenses) for the years ended December 31, 2013, 2012 and 2011.



|                                   |  | For the year ended December 31, |          |   | 2013/2012 |  |          | For the year ended December 31, |  |  | 2012/2011 |   
|---------------------------------- |  | ------------------------------- | -------- | - | --------- |  | -------- | ------------------------------- |  |  | --------- | --
|                                   |  | 2013                            |          |   | 2012      |  |          | % change                        |  |  | 2011      |   
|                                   |  | (Pesos in millions)             |          |   |           |  |          | (Pesos in millions)             |  |  |           |   
|Non-operating income (expenses)(1) |  |                                 |          |   |           |  |          |                                 |  |  |           |   
|Financial income, net              |  |                                 | 45,653   |   |           |  | (167,889 | )                               |  |  | n.m.      | % 
|Pension expenses                   |  |                                 | (478,737 | ) |           |  | (948,455 | )                               |  |  | (50       | )%
|Inflation gain                     |  |                                 | 155      |   |           |  | 97,663   |                                 |  |  | (100      | )%
|Other income (expenses), net       |  |                                 | 480,407  |   |           |  | 7,478    |                                 |  |  | 6,324     | % 








| | (1) | We reclassified some non-operational expenses to operational expenses for years 2011 and 2012 to
make figures comparable with year 2013. The most significant items reclassified included (i) provisions for inventory, property,
plant and equipment, litigation and accounts receivable and (ii) equity tax.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Net financial income.
Net financial income mainly includes exchange difference gains or losses and interest expenses, yields and interest from our investments,
and results from our hedging operations. During 2013, our results reflected a net financial income primarily due to an increase
on the cumulative exchange rate as a result of the depreciation of the Peso against the U.S. dollar. This net financial income
was partially offset by an increase in interest expenses due primarily to the local and international bond issuance of Ecopetrol
S.A. During 2012, our results reflected a net financial expense due to the cumulative exchange rate loss resulting from the appreciation
of the Peso against the U.S. dollar.



Pension expenses.
Pension expenses fell by 50% in 2013 compared with 2012, principally as a result of  (1) a decrease in amortization of the
actuarial calculation and pensions due to an actuarial calculation update of the health reserve which yielded a decrease of approximately
5.8% in the average health services costs per beneficiary and (2) a 0.2% decrease in the education reserve. In 2012, pension expenses
increased by 34% when compared with 2011, mostly as a result of (1) an actuarial calculation update of the health reserve due to
an increase of approximately 23% in the average health services costs per beneficiary and an increase of approximately 3.5% in
the population covered (retirees and their beneficiaries) and (2) an increase of approximately 9% in the education reserve.



Other net income (expenses).
Other net income includes recovery of expenses, other revenues and other recoveries. Other net expenses include legal and contribution
expenses unrelated to income. Other net income (expenses) increased significantly in 2013 compared with 2012, mainly due to: (1)
an increase in recovery of expenses (owing mostly to our success in the Quifa field arbitration) and (2) the sale of certain fixed
assets. Other income (expenses) decreased 96% in 2012 compared with 2011, principally due to a decrease of 37% in other income,
mostly related to (1) the punctual recovery of services by partners in our association contract with Occidental Petroleum in 2011
(the contract was no longer in effect in 2012) and (2) the recovery of expenses in 2011 which had no longer effect in 2012.



-101-







Income before Income Tax



Income before income tax
decreased by 2.0% in 2013 compared with 2012 mainly due to an effect of lower operating income, because of higher operating expenses.
Income before income tax decreased by 5.5% in 2012, compared with 2011, principally as a result of higher unexpected costs of water
treatment and higher prices of hydrocarbons that we purchased.



Net Income



As a result of the foregoing,
in 2013 our net income decreased by 11% as compared with 2012. In 2012, it decreased by 4% compared with 2011.



Principal Differences between
Colombian Government Entity GAAP and U.S. GAAP



We prepare our financial
statements in accordance with Colombian Government Entity GAAP. The accounting principles and regulations under Colombian Government
Entity GAAP differ in certain significant respects from U.S. GAAP. The following is a description of the most relevant differences
between Colombian Government Entity GAAP and U.S. GAAP. Note 35 to our consolidated financial statements presents reconciliations
of net income and shareholders’ equity determined under Colombian Government Entity GAAP to these same amounts as determined
according to U.S. GAAP, as well as a complete description of the differences between the two accounting standards. The principal
differences between Colombian Government Entity GAAP and U.S. GAAP are as follows:



Advances Received from
Ecogas for Build, Operate, Maintain and Transfer Contracts



Under Colombian Government
Entity GAAP, payment obligations under Build, Operate, Maintain and Transfer, or BOMT, contracts were treated as equivalent to
an operating lease. Under U.S. GAAP, the obligations were treated as capital leases, and an asset and liability were recognized.
Payments under the BOMT contracts serve to reduce liability and the asset is depreciated. Subsequently, we subleased the same asset
to Ecogas, with the corresponding treatment of the payments receivable from Ecogas as direct financing leases for U.S. GAAP purposes.



Reversal of Concessions



Under Colombian Government
Entity GAAP, we recorded an asset for the contributions of the Nation of crude oil and natural gas reserves derived from the return
of oil field concessions to the Nation, which took place before the effectiveness of Decree 1760 of 2003 came into effect. Reserves
were valued by means of the technical-economic model according to which the value per barrel resulted from the relation of the
net present value obtained at a discount rate and the total proved reserves on the contribution date. For U.S. GAAP purposes, these
reversions were considered a transfer of assets between entities under common control. Ecopetrol S.A as the entity that received
the net assets, should have initially recognized the assets transferred at their carrying amounts in the accounts of the transferring
entity at the date of transfer, which in this case would be zero because the transferring entity did not recognize a carrying value.



Effects of Inflation on
Financial Information



The accompanying consolidated
financial statements have been prepared from the accounting records, which are maintained under the historical cost convention,
modified since 1992 to comply with the legal provisions of the CGN to recognize the effect of inflation on non-monetary balance
sheet accounts until December 31, 2001, including equity. The CGN eliminated the use of inflation adjustments for accounting purposes
for state-owned companies starting on January 1, 2002. However, our consolidated financial statements recognize the effect of inflation
on non-monetary balance sheet accounts for an extended period from January 1, 1992 until December 31, 2006 for Propilco S.A.,
COMAI – Compounding and Masterbatching Industry Ltda, Hocol, Oleoducto de Colombia S.A., and Ocensa because prior to our
acquisition of these companies, they were subject to the accounting rules applicable to Colombian privately owned entities. Under
such rules, the effect of inflation on non-monetary balance sheet accounts was required to be recognized until December 31, 2006.
The accumulated inflation adjustments were eliminated in the process of reconciling our financial statements to U.S. GAAP.



-102-







Valuation Surplus



Under Colombian Government
Entity GAAP, property, plant and equipment are revalued every three years in accordance with market value and the investments in
unconsolidated investees are revalued by using the equity intrinsic value (percentage of ownership of the Company in the equity
of the investee). The excess of these amounts over the carrying amount is treated as valuation surplus with a corresponding amount
in equity (valuation surplus). Revaluation of these assets is not done for purposes of U.S. GAAP.



Variable Interest Entity



Under Colombian Government
Entity GAAP, consolidation with significant subsidiaries is required when there is control by having more than 50% ownership or
majority of the voting rights in the subsidiary. Under U.S. GAAP (FIN 46 (R)), if an entity has variable interests whereby one
party absorbs losses or benefits from net profits in excess of its ownership interest then those variable interests must be evaluated.
Ocensa was not consolidated under Colombian Government Entity GAAP until March 2009, but Ocensa was a variable interest entity
under the rules of ASC 810 and was included in our consolidated results pursuant thereto until March 2009 under U.S. GAAP. Thereafter,
Ocensa was consolidated under both Colombian Government Entity GAAP and U.S. GAAP. See Note 35 to our consolidated financial statements
for a description of our analysis.



Equity Method Accounting



Under Colombian Government
Entity GAAP, the equity method is applied for investments where significant influence, but not control, exists. However, unlike
U.S. GAAP, there is no ownership requirement between 20% and 50%. The equity method does not apply where there is no significant
influence over the investment, regardless of the ownership percentage.



Employee Benefit Plans





There are significant differences in the
measurement of expense and balance sheet amounts for employee benefit plans between Colombian Government Entity GAAP and U.S. GAAP.
See “Item 5. Operating and Financial Review and Prospects—Critical Accounting Policies and Estimates—Pension
Plans and Other Benefits” and Note 35 to our consolidated financial statements.



Investment Securities



There are significant
differences between Colombian Government Entity GAAP and U.S. GAAP in the measurement of expense and balance sheet amounts for
investments. See Note 35 to our consolidated financial statements.



Provisions — Allowances
and Contingences



There are significant
differences between Colombian Government Entity GAAP and U.S. GAAP in the measurement of expense and balance sheet amounts for
provisions: allowances and contingences . See Note 35 to our consolidated financial statements.



Cumulative Translation
Adjustment



Under Colombian Government
Entity GAAP, foreign currency investments held in a currency other than U.S. dollars must be remeasured to U.S. dollars prior to
translating such financial information to Colombian Pesos as the reporting currency. Any impact as a result of the translation
process is recognized in equity as cumulative translation adjustments.



Under U.S. GAAP, investments
in foreign currency must be remeasured to the functional currency with the effects recorded in the income statement and translate
them to the reporting currency with the effects recognized in equity as cumulative translation adjustments.



-103-







Liquidity
and Capital Resources



Our principal sources
of liquidity in 2013 were cash flows from our operations amounting to Ps$17,522,761 million and cash flows from financing activities,
mainly from the proceeds of our additional indebtedness, which totaled Ps$7,492,632.



We plan to fund part of
our capital expenditures through local and international financial markets. We believe that we should be able to access local and
international debt markets if the need arises, although we can make no assurances that these external sources of financing will
be available in terms acceptable to us, if at all. See “Item 3. Key Information—Risk Factors—Risks related to
our business.” Furthermore, we may decide to access the equity market through the issuance of an additional 8.49% of our
common stock as authorized by Law 1118 of 2006 or to obtain funds through credit facilities with commercial banks, export development
credits or the sale of shares in non-strategic assets.



The schedule for carrying
out our investment plan depends on our cash generating activities, capital market conditions, the execution of the investment budget
in the various business areas and possible acquisitions. Our investment plan and anticipated capital expenditures in future years
may change based on market and other conditions and our results of operations and financial resources.



Our principal uses of
liquidity in 2013 were (1) Ps$14,224,814 million in capital expenditures, which included investments in natural and environmental
resources and reserves, and additions to our property, plant and equipment, (2) dividend payments for the fiscal year 2013 amounting
to Ps$14,570,467 million and (3) income tax charged to Ecopetrol amounting to Ps$7,289,682.



As of December 31, 2013,
we had outstanding consolidated indebtedness of Ps$22,198,551 million, which corresponded mainly to:



ECOPETROL S.A.



| | · | Ps$1.84 trillion (approximately US$954 million) of which Ps$1.55 trillion were earmarked for liability
management, prepaying an outstanding syndicated loan disbursed in 2009 and eliminating the Ecopetrol S.A.’s guarantee for
the loan. The new facility was executed in May 2013 with seven local banks; the loan has a term of 12 years (until 2025) including
a three-year grace period. The interest rate under the facility equals the DTF, plus an additional 2.5% TA. Amortization payments
will be made semi-annually under the facility once the grace period has ended. Ecopetrol S.A. used the rest of the proceeds Ps$0.28
trillion from this loan to finance our Strategic Plan and for general corporate purposes.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | An issuance of US$2,500 billion aggregate principal amount of SEC-registered notes, issued on September
18, 2013. The registered notes were listed on the NYSE. The terms of the registered notes are as follows: US$350 million of 4.25%
Notes due 2018, US$1,300 million of 5.875% Notes due 2023, US$850 million of 7.375% Notes due 2043.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | A local issuance of Ps$900 billion (approximately US$468 million) notes on August 27, 2013. The notes
were issued in four tranches with maturities of five, ten, fifteen and thirty years and with variable interest rates based on the
Consumer Price Index plus spreads of 3.79%, 4.60%, 4.90% and 5.15%, respectively. The notes have semi-annual payments of interest
and bullet amortization for each tranche. Ecopetrol S.A. used the proceeds from the offering of these notes to finance its investment
plan.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | An issuance of US$1,500 million aggregate principal amount of 7.625% Notes due 2019 (the “Original
Notes”) on July 23, 2009 by Ecopetrol S.A. The Original Notes were issued pursuant to Rule 144A/ Regulation S with registration
rights. On September 3, 2009, Ecopetrol S.A. commenced a SEC-registered exchange offer to exchange up to US$1.5 billion aggregate
principal amount of the registered notes for an equal principal amount of its outstanding Original Notes. The exchange offer expired
on October 2, 2009, and pursuant to the exchange offer, Ecopetrol S.A. issued an aggregate amount of US$1,492,541,000 in registered
notes and cancelled an aggregate amount of US$1,492,541,000 in original notes. The registered notes were listed on the NYSE.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-104-







| | · | A local issuance of Ps$1,000 billion (approximately US$517 million) notes on December 1, 2010. The
notes were issued in four tranches with maturities of five, seven, ten and 30 years and with variable interest rates based on the
Consumer Price Index plus spreads of 2.80%, 3.30%, 3.94% and 4.90%, respectively. The notes have semi-annual payments of interest
and bullet amortization for each tranche. We used the proceeds from the offering of these notes to finance Ecopetrol’s 2010
investment plan.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On March 22, 2013, Ecopetrol S.A. entered into a credit facility guaranteed by the U.S. Eximbank.
The four international lender banks are JPMorgan Chase Bank, N.A., The Bank of Tokyo-Mitsubishi UFJ LTD, Mizuho Corporate Bank,
Ltd. and Citibank N.A. The facility consists of two tranches, whose terms are governed by: (1) a Facility Agreement for US$420,442,800,
amortized over 7 years at a rate of LIBOR + 0.65 and (2) a Credit Agreement for US$426,616,323, amortized over 10 years at a rate
of LIBOR + 0.90. The funds can only be disbursed abroad and used exclusively to reimburse for goods and services purchased from
U.S. providers. As of December 31, 2013, Ecopetrol S.A. had drawn a total amount of US$43 million under the Medium Term (CGF) Facility
Agreement and US$245 million under the Long Term (LTG) Facility Agreement.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



REFICAR



| | · | US$3.3 billion outstanding out of US$3.5 billion under five credit facilities held by Reficar with
commercial international banks (HSBC, Bank of Tokyo, Banco Bilbao Vizcaya Argentaria and Sumitomo) and export credit agencies (United
States Export Credit Agency, Export-Import Bank of the United States (the US Eximbank), the Italian Export Credit Agency (SACE)
and Exportkreditnämnden (EKN), the official Export Credit Agency in Sweden) to finance the refinery’s expansion and
modernization. The facilities have a tenor of 16 years and begin amortization in June 2014 with a payment of US$47 million. Payments
will be made semiannually.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



OTHER SUBSIDIARIES



| | · | ODL: Ps$647 billion (approximately US$336 million) outstanding out of Ps$800 billion under a loan facility
with local banks. In August 2013, ODL negotiated terms of the facility obtaining: (1) a reduction in the interest rate from DTF
+ 4% T.A. to DTF + 2.5% T.A. and (2) an extension of the tenor of seven additional years (until 2020) with a two-year grace period.
The principal amount will be amortized in 20 equal quarterly payments, beginning in November, 2015.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | ODL: Ps$300 billion (approximately US$156 million) series of notes outstanding, having a maturity
of seven years, which are being amortized in five equal payments from 2012 to 2016 and have an interest rate based on the consumer
price index plus an additional spread of 4.88%.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Oleoducto Bicentenario de Colombia: Ps$2.1 trillion (approximately US$1.07 billion) out of Ps$2.1
trillion under a facility due in 2024 with an interest rate of DTF + 4.54%. The loan will be amortized in 44 quarterly payments
after a one-year grace period.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Ocensa: In December 2013, Ocensa repaid local banks the total outstanding of a Ps$900 billion facility.
| | - | -------------------------------------------------------------------------------------------------------



| | · | Bioenergy: Ps$302 billion outstanding under an infrastructure leasing facility with a compounded
                                                                                                              average interest rate of DTF + 3.25% T.A. and a term of 15 years out of which 2 years correspond to a grace period, beginning
                                                                                                              amortization as of 2016. Ps$110 billion under credit lines with three local banks.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-105-







Use of Funds



Capital Expenditures



The following table sets
forth our consolidated capital expenditures for each of our business segments for 2013, 2012 and 2011.



|                             |  | For the year ended December 31, |           
|---------------------------- |  | ------------------------------- | ----------
|                             |  | 2013                            |           
|                             |  | (Pesos in millions)             |           
|Exploration and Production   |  |                                 | 9,622,932 
|Refining and Petrochemicals  |  |                                 | 3,835,556 
|Transportation and Logistics |  |                                 | 766,326   
|Total                        |  |                                 | 14,224,814



Our investment plan approved
for 2014 totals US$10,595 million, of which US$6,463 million is expected to be invested directly in Ecopetrol S.A. and US$4,132
million in our subsidiaries. According to the plan, 95% of investments are expected to be made in Colombia and the remaining 5%
will be made for exploration and production projects in the U.S. Gulf Coast, Brazil and Peru. As in prior years, the majority of
investments (65%) is intended for exploration and production. The investment plan is expected to be financed through our own cash
generation and through access to local and international debt markets, depending on market conditions.



Cash from Operating Activities1



Net cash provided by operating
activities decreased by 17% in 2013 compared with 2012 as a result of a 5% increase in cost of sales mostly due to the increase
in (1) purchase of imported products (naphta and ultra low sulfur diesel), (2) services in association contracts mainly for water
treatment, (3) maintenance costs for the pipeline integrity program and (4) labor costs. The 21% increase in operating expenses
in 2013 negatively impacted net cash as well compared with 2012.



Net cash provided by operating
activities decreased by 11% in 2012 compared with 2011 as a result of a 10% increase in the cost of sales due to higher international
prices for purchase of crude oil.



Cash Used in Investing Activities





In 2013, net cash used in investing activities
decreased by 42% as compared with 2012 mainly due to (1) a 49% reduction of investments for liquidity purposes, (2) a 19%
decrease in investments in property, plant and equipment and natural resources and (3) a 13% decrease in the redemptions and sales
of securities. The latter despite a 12% increase in natural resources investments.



Net cash used in investing activities decreased
by 8% in 2012 compared with 2011 mainly due to the fact that we did not acquire any companies after doing so in 2011. On the other
hand, investments in property, plant and equipment and natural resources increased 7% in 2012 from 2011, mostly due to the increase
in exploration and production activities.








| | 1 | Certain reclassifications have been made between operating
and investment activities for 2011 and 2012 to conform to the 2013 presentation. This variation changed with respect to the variation
reported in Ecopetrol’s previous 20-F due to reclassifications made of certain activities within investment and operating
activities.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-106-







Cash Used in Financing Activities



Net cash used in financing
activities increased 110% in 2013 compared with 2012 mainly due to the 73% increase in dividend payments which was partially offset
by cash resources from financial obligations which increased 47%, mainly from international and local bond issuances from Ecopetrol
S.A. Net cash used in financing activities increased 22% in 2012 compared with 2011 mainly due to an increase in dividend payments,
partially offset by cash inflows derived from indebtedness from our subsidiaries Reficar and Bicentenario. See “Liquidity
and Capital Resources.”



Dividends



In 2013, we paid dividends
of Ps$14,570,467 million to our shareholders, including the Nation, to whom we owed Ps$3,915,436 million of dividends on the net
income of 2011 as of December 31, 2012. That amount was paid as of January 2013. As of December 31, 2013, we owed Ps$1,309,852
million of dividends on the net income of 2012. That amount was paid as of January 2014.



On March 26, 2014, our
shareholders at the ordinary general shareholders’ meeting approved dividends for the fiscal year ended December 31, 2013,
amounting to Ps$10,690,341 million, or Ps$260 per share, based on the number of outstanding shares as of December 31, 2013. The
dividend per share was comprised of an ordinary dividend of Ps$227 per share and an extraordinary dividend of Ps$33 per share.
The dividends corresponding to the Nation will be paid in eight installments. The first payment will be on July 16, the second
will be made on August 11, the third will be made on September 8, the fourth will be made on October 8, the fifth will be made
on November 10, the sixth will be made between December 9, 2014 and January 9, 2015, the seventh will be made between December
15, 2014 and January 15, 2015, and the last payment will be made between December 22 2014 and January 22, 2015. The payment of
the ordinary and extraordinary dividend to the minority shareholders will be made in one lump sum from April 28, 2014.



Research
and Development, Patents and Licenses, etc.



Our Vice-Presidency of
Technology and Innovation was created in 2012 to add value to our business chain through innovation, technology, knowledge and
the development of competitive advantage. The Vice-Presidency of Technology oversees three directorates: The Colombian Petroleum
Institute, the Directorate of Information Technology and the new Strategic Directorate of Knowledge, Innovation and Technology.



Our research and development
activities are conducted by the Colombian Petroleum Institute, our research, development, transfer and data-protection unit. Its
activities are focused on developing technology solutions for us and the Colombian oil industry. Its scope covers our entire value
chain: exploration, production, refining, transportation, supply and marketing, as well as environmental issues, integrity and
automatization. Each year, we present to the Colombian Institute for the Development of Science and Technology (Instituto Colombiano
para el Desarrollo de la Ciencia y la Tecnología, or COLCIENCIAS) our research and development projects in order to
get a certification for our investment in science and technology. In 2013, 2012 and 2011, COLCIENCIAS recognized investments of
US$42.69 million, US$86.15 million, and US$50.83 million, respectively, in science and technology projects. Our total investment
in science and technology during 2013 was approximately US$161 million, of which approximately US$101 million corresponded to projects
in research and development related to air and chemicals injection in oil fields, application of technologies for offshore exploration,
petroleum systems in convergent margins, unconventional hydrocarbons, biofuels, petrochemicals, new refining processes, scaling
deasphalting process, heavy oil upgrading, as well as information technology projects. We also invested US$60 million in projects
for specialized technical and technological development as well as knowledge and innovation for our strategic business group. In
2012, we invested approximately US$97.3 million in science and technology and approximately US$67.8 million in 2011.



Our intellectual capital
is preserved through a technological value-generation process and an intellectual property protection process, which includes the
consolidation of trade secrets, patents, copyrights, trademarks and publications in specialized journals. In the last seven years,
we have filed 149 new patent applications including 21 in 2013 for technologies related to additives for hydrocarbon processing,
hydrates removers and polymeric systems for production facilities, processes for stabilizing biodiesel and methods for internal
cleaning of transport lines, among others.



-107-







We currently hold 56 patents
in Colombia, the United States, China, Mexico, Russia, Peru, Venezuela, Ecuador, Brazil and Nigeria. In 2013, 12 new patents were
granted. Our applications have focused on improving additives production and the optimization of refining processes, equipment
and tools to prevent fuel theft from pipelines, improvements in the transport of heavy and extra heavy crude oils and processes
to obtain biofuels from vegetable oils at refineries, among others. In 2012, we were granted 135 copyrights. We also kept 33 trademarks,
such as our first slogan, “Clean Barrels.”



Ecopetrol has been selected
for the fourth consecutive year as a finalist for the Global MAKE award (Most Admired Knowledge Enterprises), where it was ranked
26 among 150, improving two places compared with 2012. Likewise, Ecopetrol was ranked third among oil and gas companies worldwide,
improving three places compared with 2012.



Off-Balance
Sheet Arrangements



As of December 31, 2013,
we did not have off-balance sheet arrangements of the type that we are required to disclose under Item 5.E of Form 20-F.



Tabular
Disclosure of Contractual Obligations



Contractual Obligations



We enter into various
commitments and contractual obligations that may require future cash payments. The following table summarizes our contractual obligations
as of December 31, 2013.



Payments Due by Period



|                                                        |  | Payments due by period |           
|------------------------------------------------------- |  | ---------------------- | ----------
|                                                        |  | Total                  |           
|                                                        |  |                        |           
|Contractual Obligations:                                |  |                        |           
|Employee Benefit Plan                                   |  |                        | 26,661,452
|Contract Service Obligations                            |  |                        | 7,549,159 
|Operating Lease Obligations                             |  |                        | 87,269    
|Natural Gas Supply Agreements                           |  |                        | 900,917   
|Purchase Obligations                                    |  |                        | 184,997   
|Energy Supply Agreements                                |  |                        | 2,112,430 
|Capital Expenditures                                    |  |                        | 2,147,380 
|Build, Operate, Maintain and  Transfer Contracts (BOMT) |  |                        | 373,102   
|Capital (Finance) Lease Obligations                     |  |                        | 47,396    
|Financial Sector Debt                                   |  |                        | 3,228,636 
|Bonds                                                   |  |                        | 17,873,141
|Total                                                   |  |                        | 61,165,880



| | ITEM 6. | Directors, Senior Management and Employees
| | ------- | ------------------------------------------



Directors
and Senior Management



The information below
sets forth the names and business experience of each of our Directors, executive officers and senior management, as of the date
hereof:



-108-







Directors of Ecopetrol



The following are our
current Directors elected at the shareholders’ ordinary meeting held on March 26, 2014 for terms of one year beginning
on that date:



Minister of Mines and
Energy, Amilcar Acosta Medina (63) has been a member of our Board of Directors since March 25, 2010. He has served as Minister
of Mines and Energy of Colombia since September 11, 2013, and previously served as Advisor to the Office of the General Comptroller
of the Republic. Mr. Acosta served in the Senate of Colombia from 1991 until 2002 and was the President of the Colombian Congress
from July 1997 to July 1998. From 1990 to 1991, he served as Deputy Minister of Mines and Energy. He has held positions as a researcher
and professor at several universities and published many books and research articles on economics and on the mines and energy sector.
He has been a columnist for the leading newspapers of Colombia. Mr. Acosta earned a BA in Economics from the University of Antioquia.
He was appointed as a Director by the Nation.



Minister of Finance
and Public Credit, Mauricio Cárdenas Santamaría (51) has been a member of our Board of Directors since March
27, 2008. Mr. Cárdenas was the Minister of Mines and Energy of Colombia from September 26, 2011 to August 30, 2012. He has
served as Senior Fellow and Director at the Latin America Initiative of the Brookings Institution in Washington, D.C. Previously,
Mr. Cárdenas served as Executive Director of Fedesarrollo (Fundación para la Educación Superior y el Desarrollo),
President of Empresa de Energía Eléctrica de Bogotá, Minister of Economic Development, Minister of Transport
and Director of the National Planning Agency of Colombia. Mr. Cárdenas has also served as a member of the Board of Directors
of various organizations, including the Latin American and Caribbean Economic Association (LACEA), Universidad de los Andes and
the BVC. Currently, he is a Director of the Central Bank of Colombia. Mr. Cárdenas holds a BA and an MSc in economics from
the Universidad de los Andes and a Ph.D. in economics from the University of California, Berkeley. In 2001, Mr. Cárdenas
was a visiting scholar at Harvard University’s Center for International Development. In 1999, he was elected by Time Magazine
and CNN as one of Latin America’s Leaders for the New Millennium. Mr. Cárdenas was appointed as Director by the Nation.



Director of the National
Planning Agency of Colombia, Tatiana Orozco de la Cruz (37) has been a member of our Board of Directors since September 11,
2013. Before reaching the National Planning Agency, Mrs. Orozco was Deputy Minister of Tourism for seven months. She also served
as Executive Director of the Fundación ProBarranquilla, a private investment promotion agency for the city of Barranquilla.
Mrs. Orozco has been professor, advisor and researcher at various Colombian entities. She earned a degree in economics from the
Universidad de Los Andes, a degree in Marketing of Universidad del Norte de Barranquilla, and a master’s degree in Development
Management at the London School of Economics, United Kingdom. Mrs. Orozco was appointed as a Director by the Nation.



Jorge Pinzón
Sánchez (54) has been a member of our Board of Directors since December 6, 2012. He is a freelance attorney and an arbitrator
registered at the Centers of Conciliation and Arbitration of the Chambers of Commerce of Bogotá and Barranquilla. He was
a partner at Estudios Palacios Lleras S.A., a law firm in consulting and arbitration of business, commercial and tax law. He also
has served as the head of the Superintendency of Corporations as well as of the Superintendency of Finance of Colombia. He was
also a member of the Advisory Committee of the Banking Superintendency, member of the General Board of the Securities Superintendency
of Colombia, Secretary General of the Ministry of Finance and Public Credit and Deputy General Counsel, Secretary General and General
Counsel of Banco del Comercio, among other positions in the public and private sector. He serves as an arbitrator in the Center
of Arbitration of the Chamber of Commerce of Bogotá and served several years as a Colombian representative to the United
Nations Commission on International Trade Law (UNCITRAL). Mr. Pinzón has been a member of several boards of directors of
Colombian financial sector companies. He also was a law professor at Universidad Javeriana, Universidad de los Andes, as well as
other universities. He has also published several legal articles. Mr. Pinzón earned a degree in law and a master’s
degree in Philosophy from Universidad Javeriana. He was appointed as an independent Director.



Luis Fernando Ramírez
(54) serves as President of Federación Colombiana de Compañías de Leasing. Previously, Mr. Ramírez
served as Minister of National Defense from 1999 to 2001, Minister of Labor and Social Security from 1992 to 1994, Vice-Minister
of Finance and Public Credit and General Director of Taxes from 1986 to 1992. Mr. Ramírez earned a degree in Accounting
from Universidad Jorge Tadeo Lozano and he was Fellow of the Center for International Affairs from Harvard University, Cambridge,
Massachusetts. Mr. Ramírez was appointed as an independent Director.



-109-







Joaquín Moreno
Uribe (64) has been a member of our Board of Directors since March 27, 2008. Mr. Moreno worked for 33 years for the Royal
Dutch/Shell Group. He has held various positions such as Project Manager in Colombia; Project and Operations Manager and Marketing
and Operations Manager of Shell Química de Venezuela; Director of Marketing for Agrochemical Products and Global Marketing
Manager for Petrochemical Products at Shell Centre–Shell International Chemicals Company in London; Director of Shell Venezuela
S.A.; Director of Shell Colombia S.A., Director of Cerromatoso S.A., a Colombian mining company that is located in the department
of Córdoba, dedicated to the production of ferro-nickel and iron-nickel alloy, and Exploration and Production Business Economics
and Strategic Planning Director for Europe and the Middle East at the Shell International Headquarters in The Hague, the Netherlands.
Mr. Moreno has also served as Country Chairman and President for Shell in Mexico, Colombia and Venezuela, as well as Regional CEO
for Downstream Oil Business in the Northern Latin American Region. Mr. Moreno has been a member of the boards of directors of various
local and international companies. Mr. Moreno earned a degree in civil engineering from Universidad Industrial de Santander and
completed a program in advanced management at Harvard University Business School in Cambridge, Massachusetts. He was appointed
as an independent Director.



Gonzalo Restrepo López
(63)serves as Chairman of the Board of Directors. Mr. Restrepo was the Chief Executive Officer of Grupo Éxito S.A.
for 23 years. Prior to this position, he served as CEO of Caribú Internacional, a textile and apparel company in Medellín;
Caribe Motor S.A. and other private companies. Mr. Restrepo has been a member of different boards of directors of Colombian companies.
In 2013, he received the Cross of Boyacá in the Order of Grand Official, the highest decoration and distinction of the Colombian
state, given by the President of the country. Mr. Restrepo earned a degree in Management from Syracuse University, United States
and an MBA in Marketing from the University of Georgia, Athens, Georgia. Mr. Restrepo was appointed as an independent Director.



Horacio Ferreira
(44) is an executive leader with more than 20 years of international experience in the oil industry. His knowledge and expertise
stem from previous positions as CEO and President of an oilfield services company in Houston, TX to application of state of art
technologies in the oil industry. He has led and executed numerous reservoir engineering projects in the Americas, Europe, Africa,
Middle East and Far East and has conducted research in optimization of multiphase meters, underbalanced reservoir engineering,
real time reservoir and production analysis, reservoir simulation and waterflood techniques with horizontal wells. Mr. Ferreira
has several technical publications in reservoir management with a focus on production optimization and reservoir management. He
holds a BS from Texas A&M University, MS and D.Eng. degrees in Petroleum Engineering from Texas A&M University, and a
business graduate degree in Management of International Corporations from Texas A&M University. He was appointed as an independent
Director representing the hydrocarbon producing provinces of Colombia.



Roberto Steiner Sampedro
(54)has been a member of our Board of Directors since October 12, 2011. Mr. Steiner is an associate researcher and former
Executive Director of Fedesarrollo. He served as Alternate Executive Director of the International Monetary Fund from 2002 to 2007,
Director of the Economics Research Department of the Central Bank of Colombia from October 1989 to April 1993, Director of the
Economic Development Research Centre of Universidad de los Andes, Consultant at the World Bank from 1995 to 1996, Deputy Director
of Fedesarrollo from 1993 to 1994, Deputy Director of the Economics Research Department of the Central Bank of Colombia from 1988
to 1989, and Senior Economist at the Central Bank of Colombia from 1986 to 1988. He was a professor and researcher at various Colombian
universities, including the Universidad de los Andes, Universidad Javeriana and Universidad Nacional. In 1995, he was a summer
professor at Columbia University in New York. He has published several books, articles and research papers on economics. Mr. Steiner
earned a degree in economics from Universidad de los Andes and M.A. and M.Phil degrees in economics from Columbia University in
New York. Mr. Steiner was appointed as an independent Director representing the minority shareholders.



Officers and Senior Management of
Ecopetrol



The following presents
information concerning our executive officers and senior management. Unless otherwise noted, all of these individuals are Colombian
citizens.



-110-







Javier Gutiérrez
(62) has served as our President and Chief Executive Officer since January 22, 2007. Prior to becoming our CEO, Mr. Gutiérrez
had served as CEO of Interconexión Eléctrica S.A. ESP (ISA) since 1992, where he had begun his career in the planning
department in 1975. Mr. Gutiérrez also worked as Vice-President of the Colombian Commission for Regional Electric Integration
from 1995 to 1997. Mr. Gutiérrez earned a degree in civil engineering and a master’s degree in industrial engineering
from Universidad de los Andes and a specialization degree in finance from Universidad EAFIT. Mr. Gutiérrez has worked as
a part-time professor of statistics and research at Universidad de los Andes and as a professor of operational research at Universidad
EAFIT.



Adriana M. Echeverri
(42) joined Ecopetrol in 1994. She is currently serving as Chief Strategy and Development Officer and served as Chief Financial
Officer until May 2013. Prior to being appointed as our CSO, Mrs. Echeverri worked as Chief Financial Officer, Head of the Finance
and Treasury Unit and Head of the Corporate Finance Unit. She earned a degree in finance and foreign affairs and an MBA from Universidad
Externado de Colombia.



Magda Manosalva (42)
joined Ecopetrol in 2005. She has been serving as Ecopetrol S.A.’s Chief Financial Officer since November 2013. Prior to
being appointed as our CFO, Mrs. Manosalva was assigned, in 2012, as the Chief Financial Officer of Reficar S.A. Mrs. Manosalva
earned a degree and a master’s degree in Economics from Universidad Nacional de Colombia, and a specialization degree in
finance at Harvard Extension School. Over the course of her career she has worked on matters related to Treasury, financial risks
and liquidity management.



Margarita Obregón
(56) joined Ecopetrol in 2000. Mrs. Obregón has served as Secretary General and Secretary of the Board of Directors
since January 2008. She also serves as the company’s Chief Ethics and Compliance Officer, whose responsibilities include
monitoring and supervising the ethics and compliance program, among others, and as Leader of Corporate Social Responsibility, Corporate
Governance and Corporate Communications. Prior to joining Ecopetrol, Mrs. Obregón worked in the supply department of Previsora
S.A., an insurance company, and as a legal advisor of lands for British Petroleum Company – BP, at Alvaro Rengifo y Cia.
She also served as the head of the Business and Administration department of the Fiduciaria del Estado. Mrs. Obregón earned
a law degree from Colegio Mayor de Nuestra Señora del Rosario with specialization degrees in public management and financial
law.



Hector Manosalva (52)
joined Ecopetrol in 1986 and serves as Production and Exploration Executive Vice-President. Mr. Manosalva is a petroleum engineer
educated at the Universidad de América in Bogotá, and completed post-graduate studies in Finance at the Universidad
EAFIT and Executive Management at the Universidad de los Andes. Over the course of his career at Ecopetrol, Mr. Manosalva has served
as Chief of Production, Head of the Planning Division, Production Manager of the Southern Region, Director of Corporate Social
Responsibility, Advisor to the Office of the President of the Republic for the Protection of Energy Infrastructure and Production
Manager of the Central Region.



Pedro A. Rosales (50)joined Ecopetrol in 1989, and has served as our Downstream Executive Vice-President since February 2008. Mr. Rosales is responsible
for the Company’s refining, petrochemicals, marketing and distribution, biofuels and gas businesses. Mr. Rosales has held
several positions in the Company within the areas of maintenance, operations, projects, planning and administration. Prior to becoming
our Downstream Executive Vice-President, Mr. Rosales served as our Vice-President of Transportation since January 2003 and as our
Chief Operations Officer since 2006. Mr. Rosales earned a degree in mechanical engineering and an MBA from Universidad de los Andes.



Hector Castaño
(51) joined us in 1988 and has served as our Production Vice-President since 2011. Mr. Castaño earned a degree
in petroleum engineering from Universidad Nacional and a specialization degree in management from Universidad Sur Colombiana de
Neiva. He has held a number of positions in Ecopetrol, including Director of Production in the Central region, in the Southern
region and in the Mid-Magdalena Valley region.



Humberto Fuenzalida
(50) is a Chilean citizen and was born in Santiago de Chile. He earned a Geophysics degree from the University of Chile in
1988. He also earned a Ph.D. in the same discipline from the University Louis Pasteur in Strasbourg in 1995. His career includes
15 years of experience working for Enap-Sipetrol in the exploration area and on an Exploration Manager assignment in Egypt. He
has expertise from different locations around the world including Chile, Colombia, Egypt and the Gulf of Mexico. He joined Ecopetrol
S.A. in 2009 in the Exploration Management department as a Geophysicist and served as Manager of International Exploration until
2012. He is currently in charge of the Exploration Vice-Presidency of Ecopetrol S.A.



-111-







Rafael Guzmán
(48) is the Vice-President of E&P’s Technique and Development of Exploration and Production and has over 17 years
of experience in the oil and gas industry. He holds a BSc degree in petroleum engineering from Universidad America in Colombia,
and an MSc in petroleum engineering and a Ph.D. in petroleum engineering with a minor in mathematics, both from Stanford University.
Mr. Guzmán joined Ecopetrol in October 2010 as a Regional Manager. Prior to Ecopetrol, he worked with ENI and BP. Mr. Guzmán
was awarded the Society of Petroleum Engineers (SPE) Ferguson Medal, the Ramey Fellowship at Stanford University and the Infantas
award for innovation from ACIPET. He also served as SPE Colombian chapter president from 1995 to 1997.



Federico Maya (49)has served as our Vice-President of Refining and Petrochemicals since December 2005. Mr. Maya has held various positions at
Ecopetrol over the last 20 years, including Marketing and Contract Coordinator for Ecopetrol’s Gas Department, Corporate
Planning Directory member, and Vice-President of Supply and Marketing. Mr. Maya earned a degree in chemical engineering from Pontificia
Universidad Bolivariana and a specialization degree in marketing from Universidad EAFIT.





Claudia Castellanos (50)has served
as our Vice-President of Supply and Marketing since 2009. Mrs. Castellanos earned a degree in chemical engineering from Universidad
Industrial de Santander and a specialization degree in energy resources management from Universidad Autónoma de Bucaramanga.
She has worked in Ecopetrol for over 25 years including positions as a process engineer at Refinería de Cartagena, where
she also worked in the Economics Department. Prior to becoming our Vice-President of Supply and Marketing, Mrs. Castellanos
was Gas Manager for six years, where her focus was the domestic and international commercialization of natural gas.







Jaime Bocanegra
(45) has served as Vice-President of Transportation since April 22, 2013. Mr. Bocanegra earned a degree in petroleum engineering
from Universidad de América in Colombia, a specialization degree in Management, a specialization degree in International
Management of Oil and Gas Industry and Strategic Leadership. He has worked for Ecopetrol for the last 20 years and has held various
positions within the company, including Plant Coordinator, Multipurpose Pipelines Manager, Chief of Department, Program Manager
of Dosquebradas and Chief of the Centralized Operations.



Martha Cecilia Castaño
(45) joined us in 2004 and has served as our Vice-President of Human Resources since 2008. Prior to becoming our Human Resources
Vice-President, Mrs. Castaño worked as Coordinator of Organizational Culture, Chief of the Leadership, Internal Communications
and Cultural Unit and was also head of the Labor Relations Department. Mrs. Castaño earned a degree in social communications
and a specialization degree in economic journalism from Universidad de la Sabana and a master’s degree in Business Administration
from INALDE Business School. She has also worked in Acopi, El Tiempo, Uniandinos and Empresa de Telecomunicaciones de Bogotá
(ETB), in several areas such as human resources management, corporate communications and labor relations.



Oscar Villadiego (49)joined us in 1986 and is currently serving as the Vice-President of HSE and Operational Sustainability. He served as Vice-President
of Services and Technology from February 2008 until 2012. He has held several positions in the Production Vice-Presidency for crude
oil reserves, the development unit and the human resources unit. He served as manager for the Central region for a period of 2.5
years, and as Technical Manager for the Production Vice-Presidency for four years. Mr. Villadiego earned a degree in Petroleum
Engineering from Universidad America in 1987.



Rodolfo García
(42)joined us in February 2000 and has been our Deputy General Counsel since December 2013. Mr. García has been a Professor
at Universidad del Rosario Law School, Universidad de los Andes Business School and Universidad Externado de Colombia Law School.
He was the Colombian Representative to the Latin American Chapter of the Association of International Petroleum Negotiators –
AIPN – during 2011 and 2012. Currently, he is a member of the Colombian College of Mining and Petroleum Lawyers. During his
career in Ecopetrol, he was legal counsel in different areas, including goods and services contracts, exploration and production,
new business and M&A. Mr. García earned a law degree from Universidad del Rosario and a specialization degree in public
management and administrative institutions from Universidad de los Andes.



-112-







Jaime Pineda (51)has
served as our Director of Strategic Procurement since March 2012. He joined Ecopetrol in November 1989, working for the Legal Advisory
Office in Barrancabermeja, and has served as our Head of Procurement Legal Advice Office from 2003 until 2012. He also serves as
Professor at Santo Tomas and Externado de Colombia universities. Mr. Pineda has a Law Degree from Universidad Autónoma de
Bucaramanga, specialization degrees in public procurement from Universidad Santo Tomas and contracting law from Universidad Externado
de Colombia.



Néstor Saavedra
(51)has served as our Vice-President of Innovation and Technology since September 2012. Mr. Saavedra earned a degree in petroleum
engineering from Universidad Industrial de Santander and a master’s degree in petroleum engineering from Texas A&M University.
His work within the Company has included serving as Director of the Colombian Petroleum Institute of Ecopetrol, coordinating horizontal
well technology and rock mechanics projects, as well as assessing and predicting the behavior of Colombian oil fields. Mr. Saavedra
serves as Director of the Society of Petroleum Engineers in the South American and Caribbean Region.



Carlos Zamudio (49)
has been the Director of Shared Services since August 2012. Mr. Zamudio has more than 20 years of extensive experience in service
delivery operations in multinational companies at regional and global levels. He previously worked at Belcorp, where he was the
Corporate Director of the Shared Services Center, overseeing 15 countries including the U.S. and Brazil. He also worked at Procter
& Gamble, where he was the Corporate Finance Manager for Chile, Brazil, Costa Rica and Colombia, as well as the Global Business
Services Manager for the Latin America region.



None of our Directors
or executive officers has any familial relationship with any director or executive officer.



Compensation



The total compensation
paid to our Directors, executive officers and senior management during 2013 amounted to Ps$14,730 million.



Based on a resolution
adopted at our 2012 annual shareholders’ meeting, compensation for Directors for attendance at Board of Directors and/or
committee meetings in person increased from the equivalent of four to six minimum monthly wage salaries, which totals approximately
Ps$3,537,000 for 2013 and Ps$3,696,000 for 2014. Fees for attendance at virtual meetings are set at 50% of the in-person meeting
fee.



Our Directors are not
eligible to receive pension and retirement benefits from us. The total amount set aside to provide pension and retirement benefits
to our eligible executive officers totals Ps$14,729 million.



Share Ownership



No individual Director
or executive officer beneficially owns more than 1% of our outstanding shares.



The following Directors
and executive officers own shares of Ecopetrol:



|Director                     |  | Shares |        |  | % | 
|---------------------------- |  | ------ | ------ |  | - | 
|Joaquín Moreno Uribe         |  |        | 50.000 |  |   | 
|Mauricio Cárdenas Santamaría |  |        | 2.000  |  |   | 



|Executive Officer          |  | Shares |         |  | % | 
|-------------------------- |  | ------ | ------- |  | - | 
|Javier Gutiérrez Pemberthy |  |        | 144.413 |  |   | 
|Héctor Manosalva           |  |        | 49.380  |  |   | 
|Jaime A. Pineda            |  |        | 7.142   |  |   | 
|Federico Maya              |  |        | 50.000  |  |   | 
|Claudia Castellanos        |  |        | 13.571  |  |   | 



Under Colombian law, all
of our shareholders have the same economic privileges and voting rights.



-113-







Board Practices



Our Board of Directors
is composed of nine members and is responsible for, among other things, establishing our general business policies. According to
Colombian law, the members of the Board of Directors must be elected at the annual shareholders’ meeting in accordance with
a proportional representation system similar to cumulative voting (through an electoral quota voting system). The number of votes
required to fill each position is calculated by dividing the number of possible votes by the number of open board positions. The
members of the Board of Directors may be elected without an electoral quota voting system when there is unanimity. Pursuant to
our bylaws, Directors are elected for a one-year term, and the positions are filled either by person or by position. Members of
the Board may be reelected indefinitely. Currently, we have three members appointed by their position: the Minister of Mines and
Energy, the Minister of Finance and Public Credit and the Director of the National Planning Agency. Our current Directors were
elected at the ordinary shareholders’ meeting held on March 26, 2014. Directors may be removed without cause at any
moment by a majority of the shareholders present at a general shareholders’ meeting. Our CEO is appointed by the Board of
Directors.



The compensation of our
Directors is set exclusively by the shareholders at the general shareholders’ meeting. Colombian law prohibits Directors
from receiving corporate loans. Directors are compensated for attending board meetings and committee meetings. A Board meeting
requires a quorum of at least five members and decisions are approved with a majority of the members present. None of the contracts
of any of our Directors contains provisions for benefits upon termination of such Director’s services.



Under Colombian law, a
director or executive officer must disclose during the general shareholders’ meeting any transaction that may result in a
conflict of interest. The general shareholders’ meeting may approve or reject the transaction giving rise to the conflict
of interest with the vote of the majority of the shares present at the shareholders’ meeting. If the director or executive
officer who has the conflict is a shareholder, his or her vote must be excluded. We disclose conflicts of interest of our employees,
executive officers and directors in our Corporate Governance and Board of Directors reports.



Neither our bylaws nor
our corporate governance code provide a retirement age for our Directors. Under our bylaws, there is no requirement for a person
to have a minimum number of shares to be elected as a Director. Colombian law provides that Directors willing to sell or purchase
shares in our Company need prior authorization from the entire Board of Directors. Colombian law does not impose any limitation
as to the number of shares that may be acquired by a Director.



Pursuant to our
bylaws, our Board of Directors has four committees (Audit Committee, Corporate Governance and Sustainability Committee,
Compensation and Nomination Committee and Business Committee), which establish guidelines, set specific actions and evaluate and submit
proposals designed to improve performance in the areas under their supervision and control. These committees are populated by
members of the Board of Directors who are also appointed by the members of the Board of Directors. In addition to applicable
regulations, the committees also have their own specific regulations that establish their purposes, duties and
responsibilities.



Board Committees’
Composition as of March 31, 2014.



|Audit
        Committee                                                                                          |  | Compensation
        and NominationCommittee                                                                    |  | Corporate
        Governance andSustainability Committee                                                                                                                                                                               
|---------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Joaquín Moreno Uribe
        Roberto Steiner Sampedro
        Jorge Pinzón Sánchez
        Luis Fernando Ramírez |  | Minister of Finance and Public Credit
Minister of Mines and Energy
Gonzalo Restrepo Lopez
Luis Fernando Ramírez |  | Horacio Ferrerira Rueda
        Gonzálo Restrepo López
        Jorge Pinzón Sánchez
        Roberto Steiner Sampedro
        Director of the National Planning Agency
        of Colombia
        Minister of Finance and Public Credit



-114-







|Business
        Committee                                                                                                                                                                                                                 |  |  |  | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  |  |  | 
|Minister of Mines and Energy
        Minister of Finance and Public Credit
        Director of the National Planning Agency
        of Colombia
        Gonzalo Restrepo López
        Horacio Ferreira Rueda
        Joaquín Moreno Uribe |  |  |  | 



Audit Committee



Our audit committee, which
must be comprised of at least three members, all of them independent Directors, is our highest internal control body and provides
support to our Board of Directors on risk, accounting and financial matters. It is in charge of guaranteeing the design, implementation
and supervision of our internal control over financial reporting. It also ratifies the annual hydrocarbons reserves report and
provides support for our Board on analyzing topics related to financial matters, risks, control environment and the assessment
of the Company’s internal and external auditors.



All committee members
are required to be knowledgeable in accounting matters and at least one of them is required to be an expert in financial and accounting
matters. Luis Fernando Ramirez will serve as the audit committee financial expert.



Compensation and Nomination Committee



Our compensation and nomination
committee, which must be comprised of at least three members, including at least one independent director, provides general guidelines
for the selection and compensation of our executive officers and employees.



Corporate Governance and Sustainability
Committee



Our corporate governance
and sustainability committee, which must be comprised of at least three members, including at least one independent director, makes
proposals to our Board of Directors to ensure and supervise the fulfillment of our good corporate governance and sustainability
practices in accordance with our corporate governance code.



Business Committee



Our business committee,
which must be comprised of at least five members, including at least one independent Director, assists our Board in analyzing potential
business ventures. Based on its delegation of power, the committee studies and analyzes capital expenditure policies, major investment
projects, strategy, new business and other matters that would help us move forward in our efforts toward the consolidation of our
strategy. The primary criteria used in the committee’s decision-making are the optimization of our portfolio and the proper
allocation of our resources.



Employees



As of December 31, 2013,
Ecopetrol S.A. had 8,800 employees. A collective bargaining agreement between us and our three main labor unions (USO, ADECO and
SINDISPETROL) governs the labor relations we have with our unionized employees, which amounted to 2,560 employees as of December
31, 2013. It also governs the labor relations with the 1,140 non-unionized employees that agreed to abide by it after requesting
a waiver of Agreement 01 of 1977.Agreement 01 of 1977 governs the labor relations of our employees in positions of trust,
totaling 5,100 Ecopetrol S.A. employees as of December 31, 2013. The benefit schemes provided in the collective bargaining agreement
and in Agreement 01 of 1977 do not differ significantly. Employees are subject to Law 100 of 1993 with respect to their retirement
scheme.



-115-







Most of our employees are located in Colombia.
In order to support our corporate growth strategy, we increased the total number of Ecopetrol S.A. employees by 8.8% from 8,087
in 2012 to 8,800 in 2013. The table below presents the breakdown of Ecopetrol S.A.’s employees according to the business
segments where they work, and the personnel of our subsidiaries for the years ended December 31, 2013, 2012 and 2011. As of December
31, 2013, Ecopetrol S.A. had eight direct employees working abroad.



|                                          |  | As of December 31, |       
|----------------------------------------- |  | ------------------ | ------
|                                          |  | 2013(1)            |       
|Ecopetrol S.A.                            |  |                    |       
|Exploration and Production                |  |                    |       
|Exploration                               |  |                    | 188   
|Production                                |  |                    | 1,867 
|Others                                    |  |                    | 437   
|Total Exploration and Production          |  |                    | 2,492 
|Downstream                                |  |                    |       
|Refining                                  |  |                    | 2,716 
|Marketing                                 |  |                    | 187   
|Others                                    |  |                    | 18    
|Total Downstream                          |  |                    | 2,921 
|Transport                                 |  |                    | 1,184 
|Corporate                                 |  |                    | 2,203 
|TOTAL ECOPETROL S.A.                      |  |                    | 8,800 
|Ecopetrol America Inc.                    |  |                    | 47    
|Bioenergy S.A.                            |  |                    | 106   
|Bioenergy Zona Franca S.A.S.              |  |                    | 92    
|Hocol S.A.                                |  |                    | 197   
|Equión Energía Limited                    |  |                    | 486   
|Oleoducto Central S.A.                    |  |                    | 245   
|Oleoducto de Colombia S.A.                |  |                    | 1     
|Oleoducto de los Llanos S.A.              |  |                    | 16    
|Oleoducto Bicentenario de Colombia S.A.S. |  |                    | 28    
|Ecopetrol del Perú S.A.                   |  |                    | 2     
|Refinería de Cartagena S.A.               |  |                    | 234   
|Ecopetrol Óleo e Gás do Brasil Ltda.      |  |                    | 14    
|Propilco S.A.                             |  |                    | 353   
|Cenit                                     |  |                    | 65    
|TOTAL                                     |  |                    | 10,686








| | (1) | 193 persons employed by us during 2013 were not included in our 2013 employee statistics as they
were independent contractors involved in non-regular activities and cannot be classified as temporary employees.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



During 2013, Ecopetrol
S.A. had 603 temporary employees, a decrease of 38% compared to 2012. In 2012 and 2011, Ecopetrol S.A. had 833 and 574 temporary
employees, respectively.



Labor Unions



We currently have three
industry-wide labor unions and one company labor union:



| | · | Unión Sindical Obrera de la Industria del Petróleo — USO (industry labor
union);
| | - | --------------------------------------------------------------------------------



| | · | Asociación de Directivos Profesionales, Técnicos y Trabajadores de las Empresas de
la Rama de Actividad Económica del Recurso Natural del Petróleo y sus Derivados de Colombia — ADECO (industry
labor union);
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Sindicato Nacional de Trabajadores de Empresas Operadoras, Contratistas, Subcontratistas de Servicios
y Actividades de la Industria del Petróleo y Similares — SINDISPETROL (industry labor union); and
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-116-







| | · | Sindicato Nacional de Trabajadores de Ecopetrol — SINCOPETROL (company labor union).
| | - | ------------------------------------------------------------------------------------



Currently ECOPETROL does
not have any workers in the SINCOPETROL union. This union does not participate in the negotiation process.



Our employees and any
employee working for any company in the oil and gas industry may join the USO, ADECO or Sindispetrol. Sincopetrol may only be joined
by our employees.



On August 2, 2011 and
November 8, 2011, we experienced two work stoppages promoted by the USO in Barrancabermeja to support workers protesting at an
unaffiliated oil and gas exploration and production company, Pacific Rubiales Energy. After our subsidiary Cenit was created on
June 15, 2012, some workers (members of the USO) protested on June 19 and December 22, 2012. These protests did not affect our
operations. In 2013 we did not experience any significant labor events.



Typically, union protests
do not impact our operations because, as soon as they occur, we implement our continuity plan and integrate other trained workers
that can operate in emergency situations. Furthermore, the company has a systematic relationship model established with the unions
based on dialogue and consultation. Colombian legislation limits the exercise of strikes in the essential public services such
as those provided by us.



On August 22, 2009, as
a result of consensual negotiations, we entered into a five-year collective bargaining agreement with USO, ADECO and Sindispetrol.
During the first quarter of 2012, we held meetings with the unions to discuss revisions to the collective bargaining agreement
signed in 2009. The meetings were carried out under normal conditions and did not affect our operations. During these meetings,
we analyzed certain articles of the collective bargaining agreement to clarify ambiguities as well as those that became outdated
after the Company became public. The aspects that were analyzed during the revision process were, among others, union rights, health
care benefits and food and transportation allowances.



The collective bargaining
agreement will expire on June 30, 2014, which could lead to a negotiation of terms, including compensation, with the unions USO,
ADECO and SINDISPETROL. We look to conclude the negotiations at the direct settlement stage, once the petitions have been received
from the unions. According to the Colombian labor legislation, the expiration of a collective bargaining agreement does not result
in the termination of the conditions in the expired collective bargaining agreement. The terms of the expired prevailing collective
bargaining agreement will be extended until a new agreement is signed or an arbitral award is rendered.



The following are the
relevant terms of the current agreement in effect since 2009 and expiring on June 30, 2014:



| | · | Transportation Subsidy. The monthly transportation subsidy depends on the employee’s
location and ranges between Ps$1.376 and Ps$147.506.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------



| | · | Food Subsidy. The monthly food subsidy is Ps$332.880.
| | - | -----------------------------------------------------



| | · | Lodging Subsidy. The monthly lodging subsidy is Ps$222.357.
| | - | -----------------------------------------------------------



| | · | Education Subsidy. This subsidy covers 90% of tuition and board expenses and fixed amounts
of transportation and textbooks for our employees and their children.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Health Benefits. We pay 100% of medical expenses for workers and their families. The health
benefits include comprehensive health care service, and programs in the prevention of diseases, the supply of medicines and others.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Six-Months Bonus. Ecopetrol pays an additional 48 days of regular wage to its workers each
year: 24 days of additional regular wage in June and 24 in December.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------



-117-







| | · | Stability Clause. Employees affiliated with the Unión Sindical Obrera de la Industria
del Petroleo labor union (USO) who, as of December 1, 2004, had worked over 16 months continuously, cannot be terminated without
good cause.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Retirement Plan for Employees. Employees hired after January 29, 2003 are not covered by our
retirement scheme but are covered by the national social security system.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Five-Year Bonus. A cash benefit bonus accrues on a yearly basis and is paid for every five-year
period an employee works in the Company. The bonuses range from 9 days of basic payment plus Ps$193,990 for an employee who has
worked for the Company for 5 years to 34 days of basic payment plus Ps$193,990 for an employee who has worked for the Company for
30 years.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Labor Relations



As part of our goal to
improve workplace morale, in 2010 we implemented a number of initiatives to maintain good and trustworthy relations with our employees,
guarantee competitive wages, strengthen our corporate principles and culture, provide opportunities for personal development and
improve the general welfare of our employees. Our initiatives also sought to strengthen communication processes and to implement
performance-based compensation.



To improve the quality
of life of our employees, we extend various types of loans to them, including housing loans and general-purpose loans. In 2013,
we extended 1,192 housing loans for a total of Ps$131 billion and 1,303 general-purpose loans for a total of Ps$8.6 billion. We
also provided on-site and external training and development courses to our employees. As of December 31, 2013, our investments
in employees’ development amounted to Ps$24.9 billion, and we extended a total of Ps$139 billion in subsidies for education.



Labor Regulation



In accordance with Article
123 of the Colombian Constitution and the Article 7 of Law 1118 of 2006, our employees are considered “public servants”
even though they are subject to the common labor law. As such, their behavior is subject to the rules applicable to those who handle
public matters. A violation of those rules could lead to a disciplinary, criminal, or civil action.



| | ITEM 7. | Major Shareholders and Related Party Transactions
| | ------- | -------------------------------------------------



Major Shareholders



The following table sets
forth the names of our major shareholders, and the number of shares and the percentage of outstanding shares owned by them at March
31, 2014:



|                                               |  | At March 31, 2014 |                   
|---------------------------------------------- |  | ----------------- | ------------------
|Shareholders                                   |  | Number of shares  |                   
|Nation - Ministry of Finance and Public Credit |  |                   | 36,384,788,817.196
|Public float                                   |  |                   | 4,731,909,639     
|Total                                          |  |                   | 41,116,698,456.196



All our common shares
have identical voting rights.



As of March 31, 2014,
0.84% of our common shares were held of record in the form of American Depository Shares. As of March 12, 2014, we had 28 registered
holders and 12,890 beneficiaries of common shares, or ADSs representing common shares, in the United States.



-118-







Related
Party Transactions



Agreements



Ecopetrol S.A. and Ocensa
engage in a variety of transactions with other members of the Corporate Group in the ordinary course of business. Set forth below
is a description of material related party transactions. For additional information about transactions with related parties, see
Note 16 to our consolidated financial statements.



Ocensa



Ecopetrol S.A. has entered
into the following agreements with Ocensa:



| | · | In March 1995, Ecopetrol S.A. entered into an agreement for the transportation of crude oil through
the Ocensa pipeline. Pursuant to the terms of this agreement, Ecopetrol S.A. was required to make monthly payments that varied
depending on both the volume of crude oil we transported through the pipeline and a tariff imposed by Ocensa on the basis of Ocensa’s
financial projections and their expected volumes of crude oil. In 2012, payments made by Ecopetrol S.A. under this agreement amounted
to US$290.42 million. On January 17, 2013, this agreement was amended as a result of Ocensa’s new business model. Among other
changes, this amendment to the transportation agreement establishes the payment of the tariff calculated according to Resolutions
issued in 2010 by the Ministry of Mines and Energy. In 2013, another amendment was executed that modified the terms by which the
payments of invoices should be made.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On January 17, 2013, the Amended and Restated Oleoducto Central Agreement and other agreements derived
from it were terminated by mutual consent among the parties. On the same date, January 17, 2013, Ocensa and its shareholders—Cenit,
Ecopetrol Pipelines International Limited, Santiago Pipelines Company, New Santiago Pipelines Company, Total Colombia Pipeline,
Inversiones Sol del Sur S.A.S. and Cepsa Colombia S.A.—entered into a new shareholders agreement that establishes the basis
for a new business model, pursuant to which Ocensa has become a profit center instead of a cost center. This agreement became effective
as of the date of execution and will be in effect until Ocensa is registered on an exchange. Additionally, this agreement might
be renegotiated if the control structure of Ocensa is modified.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On October 28, 2013, Ecopetrol entered into a natural gas supply contract in force until November
30, 2018, pursuant to which Ecopetrol S.A. receives a fixed price per MBTU. This agreement replaced the contract for natural gas
supply entered into on December of 2004, under which Ocensa paid a variable rate to Ecopetrol. In 2013, Ecopetrol S.A. received
an aggregate sum of US$3.35 million under the former contract.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On July 10, 2012, Ecopetrol entered into a ship or pay agreement for the operation of Ocensa’s
unloading facilities at which Ecopetrol unloads crude oil. This agreement was later amended on March 12, 2013 and on July 19, 2013.
By virtue of this agreement, Ecopetrol S.A. paid fees of US$2.48 million to Ocensa in 2013. These fees correspond to a cost of
US$1.50 per barrel of crude oil that is unloaded. The agreement is for a term of five years, and may be terminated for any of the
following reasons: in case of breach; dissolution and winding up of Ecopetrol; change of control of Ecopetrol when the new shareholder,
its directors or managers are reported in OFAC or have been convicted for a crime related to money laundering or terrorist financing;
assignment of the agreement without compliance with the requirements set forth in the agreement; or unilaterally by either of the
parties in case of a justified event.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In November 1996, Ecopetrol S.A. leased the Cravo Norte dock to Ocensa. Pursuant to the terms of the
agreement, Ecopetrol S.A. received monthly payments during 2013 of US$300.00 plus applicable taxes. This contract was transferred
to Cenit, effective in January 2014.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-119-







| | · | In September 1999, Ecopetrol S.A. entered into a joint operation agreement for the TLU-3 Coveñas
buoy with Ocensa and ODC. Pursuant to the terms of this agreement Ecopetrol S.A. is required to make fixed monthly payments of
US$75,000 plus a variable amount depending of the volume of crude oil exported through the buoy. There have not been variable payments
in the last three years. The duration of this agreement is indefinite but can be terminated by mutual consent. In December 2013,
Ocensa’s board of directors authorized the assignment of this agreement by Ecopetrol S.A. to Cenit.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In December 1999, Ecopetrol S.A. entered into an operation and maintenance agreement for the Porvenir,
Miraflores and Vasconia pumping stations. In 2013, pursuant to the terms of this agreement, Ecopetrol S.A. received payments of
approximately US$13.64 million plus applicable taxes, fixed and variable costs in 2013.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Ocensa has entered into
the following agreements with some of our subsidiaries:



| | · | In March 1995, Equión Energia Limited and Santiago Oil Company entered into an agreement for
the transportation of crude oil through the Oleoducto Central S.A. (Ocensa) pipeline. In November 2012, Equión Energía
Limited and Santiago Oil Company transferred, by means of various transactions, its shares (24.8%) and transportation rights (19.8%)
holdings in the Ocensa pipeline to wholly owned subsidiaries of Ecopetrol S.A. (51%) and Talisman (49%). Equión kept 5%
of transportation rights in Ocensa. In 2013, the transportation fees billed by Ocensa were: Equión Energía Limited
(US$21.5 million), Santiago Oil Company (US$3.7 million) and Hocol and Homcol (US$10.9 million).
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On January 3, 2013, the Technical Services and Management Agreement (Contrato de Servicios Técnicos
y Administrativos) between Ecopetrol S.A. and Ocensa was terminated by mutual consent.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Ocensa, Equión and Ecopetrol S.A. entered into a water batching agreement for a five-year term
beginning on July 1, 2010. The purpose of this agreement is to transport the water necessary for oil and gas production. In 2013,
Ocensa received US$0.30 million in fees under this contract. These fees correspond to the reimbursement of costs incurred by Ocensa
for rendering services under this contract.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On December 19, 2013, Ecopetrol S.A. entered into a gas supply agreement for the generation of electricity
with Equión, Santiago Oil and SPEP. Equión, Santiago Oil and SPEP will receive distributions of oil and gas in set
proportions (Equión 11.64%, Santiago 7.35% and SPEP 11.64%). This agreement became effective as of January 1, 2014 and will
expire on December 31, 2018. This agreement will terminate should either of the following events occur: the Rio Chitamena association
contract terminates or Ocensa is no longer the owner of electricity generation equipment. In 2013, Ocensa did not make any payments
pursuant to this contract. For subsequent years, the contract provides that Ocensa will pay each of the other parties an amount
set forth by a formula set in the contract.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Oleoducto de Colombia S.A. (ODC)



Ecopetrol S.A. entered
into the following agreements with ODC:



| | · | In July 1992, a take-and-pay agreement for the transportation of hydrocarbons. Pursuant to this agreement,
Ecopetrol S.A. must pay a previously agreed tariff over the volume of hydrocarbons transported. The duration of this agreement
is indefinite; however the contract will remain in force as long as Ecopetrol S.A. holds shares in Oleoducto de Colombia S.A.,
whether directly, or through an affiliate. As of January 2013, the applicable tariff is the one set by the Ministry of Mines and
Energy (MME). The MME Tariff had been set in 2011 for a four-year term, with a yearly adjustment based on the consumer price index.
For 2013, the tariffs were US$1.7053 per barrel (January through June) and US$1.7705 per barrel (July through December).
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-120-







| | · | In August 1992, an operation and maintenance agreement for the Vasconia and Coveñas terminals
both property of ODC. Pursuant to the terms of this agreement, ODC paid in 2013 approximately US$34.4 million, which include a
variable surcharge between 5% and 12% on such expenses, plus any applicable taxes. The duration of this agreement is indefinite,
but can be terminated by any party upon six-months’ notice.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In March 1998, a joint operation agreement for the TLU-1 Coveñas buoy. Pursuant to the terms
of this agreement, ODC paid Ecopetrol S.A. approximately US$10.5 million in 2013. The duration of this agreement is indefinite
and can be terminated by mutual agreement. In December 2013, Ecopetrol S.A. assigned its rights under this agreement to Cenit,
though Ecopetrol S.A. kept its role as operator under the agreement.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In September 1999, a joint operation agreement for the TLU-3 Coveñas buoy with Ocensa and ODC.
Pursuant to the terms of this agreement, ODC paid approximately US$8.9 million in 2013. The duration of this agreement is indefinite.
In December 2013, Ecopetrol S.A. assigned its rights under this agreement to Cenit, though Ecopetrol S.A. kept its role as operator
under the agreement.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In July 2006, an operation and maintenance agreement for the Caucasia Station and the Vasconia-Coveñas
pipeline system. Since 2010, this agreement only covers the operation of the Caucasia station and the Vasconia-Coveñas pipeline
system, both property of ODC. Pursuant to the terms of this agreement, Ecopetrol S.A. received payments of approximately US$16.7
million in 2013, which includes expenses incurred by Ecopetrol S.A. for the performance of the agreement, with a variable surcharge
of between 5% and 12% on such expenses, plus any applicable taxes. The duration of this agreement is indefinite.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



ODC has entered into the
following agreements with some of our subsidiaries:



| | · | Between March 1992 and January 1993, Hocol, Equión Energía Limited and Santiago Oil
Company each entered into agreements with ODC for the transportation of crude oil through the Vasconia-Coveñas pipeline.
The term of each of these agreements is indefinite. As of January 2013, the applicable tariff is the one set by the Ministry of
Mines and Energy.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In April 1996, due to the construction of Ocensa’s pipeline, ODC and OCENSA entered into a construction
agreement. According to this agreement Ocensa leases certain areas, and uses facilities and auxiliary systems in Vasconia, Caucasia
and Coveñas. The contract has a yearly term which renews automatically unless any party gives termination notice no later
than three months prior to the termination date. Under the contract, Ocensa pays a monthly fee totaling US$1.4M yearly.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In August 2001, ODC entered into a shared costs agreement with Ocensa. According to this agreement,
the two companies agreed on cost sharing for security, air and land transportation along the pipelines, and for pipeline mechanic
and geotechnical maintenance—i.e., maintenance of the pipeline itself, which includes the prevention of damage associated
with landslides. This contract has been biannually renewed by mutual consent and can be terminated anytime upon six months’
notice by either party.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In January 2010, ODC and Ocensa entered into a collaboration agreement to secure administrative, legal
and financial services for ODC. The duration of this agreement is indefinite, but can be terminated by any party upon six-months’
notice. It has been agreed that ODC pays Ocensa a monthly fee that totals US$1 million per year.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In July 2010, ODC entered into a pipeline maintenance agreement with Ocensa. According to this agreement
Ocensa coordinates all activities required for the ODC’s pipeline mechanics and geotechnical maintenance. The duration of
this agreement is indefinite, but can be terminated by either party upon six-months’ notice. ODC pays Ocensa a fixed monthly
fee totaling US$0.7M per year. The cost of services rendered by third parties that benefit both parties is shared according to
the terms of the shared costs agreement.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-121-







Oleoducto de los Llanos Orientales
(ODL)



Ecopetrol S.A. have entered
into two ship-or-pay agreements with ODL:



| | · | In March 2009, Ecopetrol S.A. entered into a ship-or-pay agreement with ODL that establishes a financing
tariff used to pay ODL’s indebtedness to Grupo Aval for five years. This agreement was superseded by a new contract executed
in May 2010, with a seven-year term, to reflect new conditions agreed with Grupo Aval. In August 2013, this contract was amended,
providing a new term of seven years, two two-year grace periods, and an interest rate of DTF + 2.5%. This financing tariff is collected
through a trust fund, which in turn is responsible for making the debt service payments to Grupo Aval. Under this agreement, ODL
has committed to transport 75 thousand bpd during the initial two-year grace period of the facility and 90 thousand bpd during
the remaining years including the new term. Ecopetrol is responsible for 65% of this capacity.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In September 2009, Ecopetrol S.A. entered into a second ship-or-pay agreement with ODL that establishes
a financing tariff collected through a trust fund that in turn is responsible for making debt service payments to security holders.
Under this agreement, ODL committed to transport 19.5 thousand bpd during the first phase of the ODL project (which began in September
2009 and ended in the first quarter of 2010) and 39 thousand bpd upon commencement of the second phase of the ODL project which
occurred in the first quarter of 2010.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In December 2009, Ecopetrol S.A. entered into a service agreement with ODL to transport crude oil.
This agreement expires in June 2016 and can be renewed. Pursuant to the terms of this agreement, in 2013 Ecopetrol S.A. made monthly
payments totaling Ps$229 billion for the year.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In March 2010, Ecopetrol S.A. entered into a pipeline operating and maintenance agreement with ODL.
This agreement has a five-year term and the amount payable to us for the entire term of the agreement is Ps$56.4 billion, plus
any applicable taxes.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In March 2010, Ecopetrol S.A. entered into an undiluted crude oil supply agreement, which was renewed
in December 2013 until December 2014. Pursuant to the terms of this agreement, in 2013 ODL paid to Ecopetrol S.A. Ps$19.2 billion
plus applicable taxes.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In July 2013, Ecopetrol S.A. entered into a service agreement with ODL to dilute, in the facilities
of Cusiana (CPF Cusiana), crude oil transported in the Rubiales – Monterrey/Cusiana pipeline, with a committed capacity of
182 thousand bpd. For 2013, 130 thousand bpd of the committed capacity corresponds to the “Take or Pay” volume. Pursuant
to the terms of this agreement, in 2013, Ecopetrol had made monthly payments totaling Ps$7.6 billion for the year.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Oleoducto Bicentenario de Colombia
S.A.S.



| | · | In November 2011, Ecopetrol S.A. signed a five-year technical assistance services contract for the
construction of the Araguaney-Coveñas pipeline. This contract is finishing its first phase on March 2014. Future phases
are under evaluation.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In June 2012, Ecopetrol S.A. entered into ship-or-pay and ship-and-pay crude oil transportation agreements
with Oleoducto Bicentenario that establishes a price, which requires the payment of Bicentenario’s indebtedness to local
banks for 12 years. This tariff is collected through a trust; the trust is also responsible for making the debt service payments
to the banks. The duration of the ship-or-pay agreement is the earlier of 12 years or when the credit has been entirely paid, and
the duration of the ship-and-pay agreement is 20 years after the ship-or-pay terminates. Under these agreements, Bicentenario has
committed to transport at least 110,000 bpd, of which the 55% of the agreement volume is provided directly by Ecopetrol S.A. and
0.97% indirectly by Hocol. In June 2012, Ecopetrol S.A. entered into storage-or-pay and storage-and-pay agreements with Oleoducto
Bicentenario. Under these agreements, Bicentenario is committed to receive, store, preserve and deliver our crude oil. The storage-or-pay
agreement will terminate when Bicentenario’s indebtedness to local banks has been entirely paid, and the duration of the
storage-and-pay agreement is 20 years after the storage-or-pay agreement terminates.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-122-







| | · | In August 2012, Ecopetrol S.A. entered into an Operation and Maintenance agreement for the Arguaney
– Banadia pipeline system. Pursuant to the terms of this agreement Ecopetrol S.A. received Ps$23 billion from the beginning
of the contract through December 2013. Ecopetrol S.A. will receive estimated payments of US$36.4 million per year. The duration
of this agreement is 15 years.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Other Agreements



| | · | Ecopetrol S.A. entered into a supply agreement with Ecodiesel, a company in which Ecopetrol S.A. has
a 50% equity interest. This agreement has been operative since August 1, 2010. Pursuant to the terms of this agreement, Ecodiesel
must deliver to Ecopetrol S.A.—and Ecopetrol S.A. must in turn purchase—at least 80% of Ecodiesel’s biodiesel
production each month. Payments vary depending on the purchased volumes of biodiesel. This agreement expires on December 31, 2017.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | In 2010, Ecopetrol S.A. renewed the service agreement with Societal Colombiana de Servicios Mortuaries
S.A., or Serviport, a company in which we had a 49% equity interest through September 30, 2012. On October 1, 2012, Ecopetrol
S.A.’s equity ownership in Serviport passed to Cenit. Pursuant to the terms of this agreement, Serviport assists Ecopetrol
S.A. in its maritime operations at the Coveñas port. This agreement expires on May 27, 2019.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Transactions with Other State-Controlled
Entities



We are a state-controlled
oil and gas company and operate in an industry regulated by governmental authorities, agencies and other organizations.



In the ordinary course
of business we enter into transactions with other state-owned entities that include but are not limited to the following:



| | · | selling and purchasing goods, including crude oil purchases of ANH royalties;
| | - | -----------------------------------------------------------------------------



| | · | properties and other assets;
| | - | ----------------------------



| | · | rendering and receiving services;
| | - | ---------------------------------



| | · | leasing assets;
| | - | ---------------



| | · | depositing and borrowing money; and
| | - | -----------------------------------



| | · | using public utilities.
| | - | -----------------------



Purchases of Hydrocarbons



The purchase of hydrocarbons
is made in the ordinary course of business, and on terms comparable to those offered to private parties. We have established procurement
policies and approval processes for purchases of products and services, which do not depend on whether the counterparties are state-owned
entities.



Loans to Our Employees



We extend loans for housing
and general purposes to all of our employees as part of our compensation scheme. The principal amount of the loan depends on the
applicant’s tenure and cannot exceed 59 times the applicant’s monthly salary. We do not guarantee any loans made by
third parties.



-123-







Other than maintaining
housing loans to some executive officers as described in the table below, neither we nor any of our subsidiaries, have provided
loans (including housing loans), extended or maintained credit lines, arranged for the extension of credit by third parties, materially
modified or renewed an extension of credit lines, in the form of a personal loan to or for any of our executive officers since
our ADSs were registered under the Exchange Act.



The following table sets
forth a description of the loans outstanding to our executive officers as of December 31, 2013 (figures in millions of Colombian
Pesos).



|Executive Officer         |  | Date of Approval     |  | Nature of the
    Loan and Date of Disbursement |  | Principal
    Amount of the Loan |       |  | Amount
    Outstanding at December 31, 2013 |  |       | Largest Amount
    Outstanding during period |  |  | Termination
    Date |  |  | Applicable
    Interest Rate |                                                        
|------------------------- |  | -------------------- |  | ----------------------------------------------- |  | -------------------------------- | ----- |  | ------------------------------------------- |  | ----- | -------------------------------------------- |  |  | -------------------- |  |  | ---------------------------- | -------------------------------------------------------
|Javier G.
    Gutiérrez   |  | January 23,
    2007 |  | Housing, June 26, 
    2008                     |  |                                  | 729.0 |  |                                             |  | 542.8 |                                              |  |  | 729                  |  |  |                              | June, 
                                         2028   
|Pedro A. Rosales          |  | April 30,  1997      |  | Housing, August 16,
    1997                    |  |                                  | 47.3  |  |                                             |  | 0     |                                              |  |  | 247.5                |  |  |                              | -                                                      
|                          |  | September 16, 2003   |  | Housing, December 11,
    2003                  |  |                                  | 231.9 |  |                                             |  | 118.7 |                                              |  |  |                      |  |  |                              | December,
                                         2018
|Oscar Villadiego(2)       |  | December 29, 1999    |  | Housing, January 11,
    2001                   |  |                                  | 78.0  |  |                                             |  | 5.5   |                                              |  |  | 78                   |  |  |                              | April,
                                          2019  
|Nestor Saavedra(3)        |  | August 10, 2007      |  | Housing, October 25,
    2007                   |  |                                  | 134.1 |  |                                             |  | 88.8  |                                              |  |  | 134.1                |  |  |                              | April,
                                         2018   
|Adriana M. Echeverri      |  | January 27, 1997     |  | Housing, August 16,
    1997                    |  |                                  | 44.8  |  |                                             |  | 0     |                                              |  |  | 45.1                 |  |  |                              | -                                                      
|                          |  | June 12, 2002        |  | Housing, December 10
    2002                   |  |                                  | 37.1  |  |                                             |  | 24.5  |                                              |  |  |                      |  |  |                              | February,
                                         2018
|Jaime Bocanegra Bernal(4) |  | November 12, 2010    |  | December 15, 2011                               |  |                                  | 271.4 |  |                                             |  | 252.4 |                                              |  |  | 271.4                |  |  |                              | June,
                                         2027    
|Magda Manosalva(5)        |  | October 10, 2007     |  | November 27, 2007                               |  |                                  | 133.4 |  |                                             |  | 235.1 |                                              |  |  | 318                  |  |  |                              | -                                                      
|                          |  | March 30, 2009       |  | May 26, 2009                                    |  |                                  | 184.6 |  |                                             |  |       |                                              |  |  |                      |  |  |                              | July,
                                         2024    



| | (1) | As the regulatory entity for these purposes, the Central Bank of Colombia (Banco de la República)
defines the term “UVR” as Unidad de Valor Real (Real Value Unit), an accounting unit which reflects purchasing
power based exclusively on the consumer price index variation certified by the National Statistics Department of Colombia (DANE).
The UVR is used to calculate the cost of housing credits in Colombia. This accounting unit allows financial entities to adjust
credit values to the cost of living increase in Colombia.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | Oscar Villadiego became an executive officer in March 2012 upon the reorganization of our senior
management’s structure approved by our Board of Directors. See “Item 6. Directors, Senior Management and Employees3⁄4Officers
and Senior Management of Ecopetrol.”
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | Néstor Saavedra became an executive officer in September 2012.
| | --- | --------------------------------------------------------------

| | (4) | Jaime Bocanegra became an executive officer in July 2013.
| | --- | ---------------------------------------------------------

| | (5) | Magda Manosalva  became an executive officer in November 2013.
| | --- | --------------------------------------------------------------



| | ITEM 8. | Financial Information
| | ------- | ---------------------



Consolidated
Statements And Other Financial Information



Our annual consolidated
financial statements are filed as part of this annual report starting on page F-1.



Legal Proceedings



We are a party to various
legal proceedings in the ordinary course of business. Other than the proceedings disclosed in this annual report, we are not involved
in any pending (or, to our knowledge, threatened) litigation or arbitration proceeding that we believe will have a material adverse
effect on our Company. Other legal proceedings that are pending against or involve us and our subsidiaries are incidental to the
conduct of our and their business. We believe that the ultimate disposition of such other proceedings individually or in an aggregate
basis will not have a material adverse effect on our consolidated financial condition or results of operations.



-124-









As of December 31, 2013, we were a party
to 3,201 legal proceedings relating to civil, administrative, environmental, tax and labor claims filed against us in the Colombian
courts and arbitration tribunals, of which 286 had an accrual provision. We allocate sufficient amounts of money and time to defend
these claims. Historically, we have been successful in defending lawsuits filed against us. Based on the advice of our legal advisors,
it is reasonable to assume that the litigation procedures brought against us will not materially affect our financial position
or solvency regardless of the outcome. See Note 31 to our annual consolidated financial statements included in this annual report
for a discussion of our legal proceedings.



In December 2010, Llanos Oil Exploration
Ltd., or Llanos Oil, filed a lawsuit against us in a district court of the Netherlands before The Court of The Hague which, if
decided against us, could materially affect our financial condition. The plaintiff alleges early termination attributable to us
of the following exploration activity contracts: the 1997 Las Nieves Association Contract and the 2002 Guatapurí Association
Contract. These contracts were terminated because of the default by Llanos Oil on July 28, 2000, and July 23, 2003, respectively,
in accordance with the provisions of the contracts. In the incidental proceedings judgment of May 30, 2012, the district court
in The Hague ruled that it lacks jurisdiction to hear the case and rejected all the legal grounds of the plea of Llanos Oil regarding
the jurisdiction of the court. Llanos Oil appealed on August 2012. On October 15, 2013, the Court of Appeals rejected Llanos Oil’s
appeal in full; the judgment of the Court of First Instance that the Dutch Courts do not have jurisdiction was confirmed. Llanos
Oil appealed the judgment of the Court of Appeals before the Supreme Court and the decision on appeal is expected during the second
half of 2014. We have not created a provision for this claim because our legal counsel in The Hague considers the probability of
success for Llanos Oil to be remote.



On April 16, 2012, we were served with a
class action suit against us, seeking monetary damages of approximately Ps$86 billion related to the December 2011 Caño
Limón-Coveñas Crude Oil Pipeline Spill. See “Item 4. Information on the Company—Overview by Business
Segment—Transportation Infrastructure—Incidents at Transportation Facilities—Caño Limón-Coveñas
Crude Oil Pipeline Spill.” The Colombian Attorney General’s Office filed a motion requesting the judge to require the
claimant to justify the amount. The claimant reduced the claim to Ps$11 billion. However the court appraised the damages to be
at the most Ps$298 million, based on the number of people involved in the class action. The court set the date of the conciliation
hearing for October 23, 2012, but the claimant did not attend and instead requested the court to set a new date for the settlement
hearing. The court declined the request and decided to continue with the proceeding. The evidence stage of this proceeding started
in 2013. Our legal counsel is of the opinion that this class action suit has only a remote possibility of success.



Foncoeco



An association of former employees known
by the acronym Foncoeco brought an action against us in connection with a company profit-sharing plan offered in 1962 that
expired in 1975. The plaintiffs claim that our Board of Directors had set aside a specific amount under the profit-sharing plan,
which was not entirely distributed to employees eligible under the plan. The court of first instance ruled on June 25, 2002 in
our favor and rejected the plaintiffs’ arguments. The plaintiffs appealed the ruling to the Bogota Higher Tribunal, which
ordered us to present a rendición de cuentas (an accounting action) to the first instance judge based on the amounts
allocated by our Board of Directors. Based on the judge’s conclusion with respect to our accounting and the expert testimony
of a witness presented by the plaintiffs, who we maintain included amounts never allocated by our Board of Directors to the profit
sharing plan, the first instance judge, in 2005, ordered us to pay Ps$541,833 million, or approximately US$281.2 million. We appealed
the decision by the first instance judge to the Bogota Higher Tribunal and on June 22, 2011, the court ruled in our favor and reduced
the amount we must pay to Ps$6.6 million, or approximately US$3.418. On March 14, 2012, the Colombian Supreme Court of Justice
permitted an extraordinary appeal filed by the plaintiffs. Ecopetrol filed its defense pleadings on May 18, 2012. On November 1,
2013, Colombian Supreme Court of Justice ruled that appeal filed by Foncoeco was to be ungrounded. Therefore, Supreme Court judgment
declared that the sentence formerly issued by civil high court of Bogotá, awarding damages against Ecopetrol for only Ps$6.6
million (approximately US$3,418), was correct and to be sustained.



-125-







PetroTiger





On January 6, 2014, The United States Department
of Justice (DOJ) announced the unsealing of charges against two former co-chief executive officers and the former general counsel
of PetroTiger Ltd. (PetroTiger), alleging, among other things, violations of the U.S. Foreign Corrupt Practices Act (FCPA) and
conspiracy to commit violations of the FCPA and money laundering in connection with payments made to an Ecopetrol employee, who
by the time of the announcement by the DOJ no longer worked at the Company, to secure Ecopetrol’s approval for PetroTiger’s
entry into an oil services contract with Mansarovar Energy Colombia Ltd. Ecopetrol participated in the Mansarovar project as non-operating
partner. At that time, the DOJ also announced that the general counsel of PetroTiger had pled guilty on November 8, 2013 to a criminal
information charging one count of conspiracy to violate the FCPA and to commit wire fraud. One of the charged former co-CEO’s
pleaded guilty on February 18, 2014 to the same charges. Charges remain pending against the other former chief executive officer.
Ecopetrol has approached the Colombian authorities to provide information for the criminal investigation and cooperated with the
prosecutor general’s office. Additionally, it has responded to information requests from the DOJ and Colombian authorities
in connection with the investigation of the PetroTiger executives. Ecopetrol is evaluating the need to implement further enhancements
to its compliance program.



Dividends



We do not have a dividend
policy. Pursuant to Colombian law, we may distribute dividends to our shareholders. Our Board of Directors may propose a dividend,
which declaration, amount and payment per share is subject to approval by a simple majority of the shareholders. In 2011, 2012
and 2013 the shareholders approved the distribution of 70.3%, 79.9% and 80.1% of 2010, 2011 and 2012 net income, respectively.
On March 26, 2014, our shareholders at the ordinary general shareholders’ meeting approved an ordinary dividend of 69.9%
plus an extraordinary dividend of 10.2% of net income for the fiscal year ended December 31, 2013. See “Item 5. Operating
and Financial Review and Prospects—Liquidity and Capital Resources—Use of Funds—Dividends.”



Significant
Changes



There have not been any
significant changes since the date of our annual consolidated financial statements for the year ended December 31, 2013.



| | ITEM 9. | The Offer and Listing
| | ------- | ---------------------



Trading
Markets



In August 2007, we conducted
an initial public offering of 10.1% of our common shares in Colombia. As a result of such offering, our common shares have traded
on the BVC since November 2007 under the symbol “ECOPETROL.” Our ADSs, representing 20 common shares, have been traded
on the NYSE under the symbol “EC” since September 2008. JPMorgan Chase Bank, N.A. serves as depositary for our ADSs.



Since August 2010, our
ADSs have been traded on the Toronto Stock Exchange under the symbol “ECP.”



The second round of the
equity offering program took place between July 27 and August 17, 2011. The offer was directed exclusively to investors in Colombia
as permitted by Law 1118 of 2006. A total of 644,185,868 shares were allotted, equivalent to approximately Ps$2.38 trillion. Out
of the 219,054 investors participating in this round, 73% were new stockholders. In addition, 87% of the offering was allocated
to retail investors and the remaining 13% to institutional investors. Funds obtained by us through this offering were allocated
to the Company’s investment plan.



In the future, the Nation
(via the Ministry of Finance and Public Credit), as our controlling shareholder, may make decisions or announcements about its
intention to sell part of its holding of our capital stock, as it has announced in recent years. We understand that our cooperation
is necessary for the successful coordination of the Nation’s process.





-126-







The following table sets
forth reported high and low closing prices in Pesos for our shares and the reported average daily trading volume of our shares
on the BVC for the periods indicated. The table also sets forth information on the trading price of our shares in Pesos and U.S.
dollars, as well as the average trading volume.





|                        |  | Shares Traded on the BVC |      
|----------------------- |  | ------------------------ | -----
|                        |  | Pesos per share          |      
|                        |  | High                     |      
|2009                    |  |                          | 2,815
|2010                    |  |                          | 4,660
|2011                    |  |                          | 4,300
|2012                    |  |                          | 5,850
|2013                    |  |                          | 5,710
|                        |  |                          |      
|Most recent quarters    |  |                          |      
|First quarter 2012      |  |                          | 5,480
|Second quarter 2012     |  |                          | 5,850
|Third quarter 2012      |  |                          | 5,430
|Fourth quarter 2012     |  |                          | 5,790
|First quarter 2013      |  |                          | 5,710
|Second quarter 2013     |  |                          | 5,020
|Third quarter 2013      |  |                          | 4,495
|Fourth quarter 2013     |  |                          | 4,590
|First quarter 2014      |  |                          | 4,030
|                        |  |                          |      
|Most recent six months  |  |                          |      
|October 2013            |  |                          | 4,590
|November 2013           |  |                          | 4,490
|December 2013           |  |                          | 4,160
|January 2014            |  |                          | 3,700
|February 2014           |  |                          | 3,770
|March 2014              |  |                          | 4,030
|April 2014 (through 25) |  |                          | 4,030












| | (1) | U.S. dollars per common share translated at the Representative Market Exchange Rate as of each
period.
| | --- | ------------------------------------------------------------------------------------------------------



The following table sets
forth reported high and low closing prices in U.S. dollars for our ADSs and the average daily trading volume of our ADSs on the
NYSE for the periods indicated. The table also sets forth information on the trading price of our ADSs in U.S. dollars, as well
as the average trading volume.



|                        |  | ADSs Traded on NYSE     |      
|----------------------- |  | ----------------------- | -----
|                        |  | U.S. dollars per ADS(1) |      
|                        |  | High                    |      
|2009                    |  |                         | 29.99
|2010                    |  |                         | 51.92
|2011                    |  |                         | 46.00
|2012                    |  |                         | 67.48
|2013                    |  |                         | 63.80
|                        |  |                         |      
|Most recent quarters    |  |                         |      
|First quarter 2012      |  |                         | 61.86
|Second quarter 2012     |  |                         | 67.48
|Third quarter 2012      |  |                         | 59.55
|Fourth quarter 2012     |  |                         | 63.70
|First quarter 2013      |  |                         | 63.80
|Second quarter 2013     |  |                         | 54.70
|Third quarter 2013      |  |                         | 47.69
|Fourth quarter 2013     |  |                         | 48.91
|First quarter 2014      |  |                         | 40.79
|Most recent six months  |  |                         |      
|October 2013            |  |                         | 48.91
|November 2013           |  |                         | 46.90
|December 2013           |  |                         | 42.97
|January 2014            |  |                         | 38.45
|February 2014           |  |                         | 36.63
|March 2014              |  |                         | 40.79
|April 2014 (through 25) |  |                         | 41.16





-127-












| | (1) | Each ADS represents the right to receive 20 of our common shares.
| | --- | -----------------------------------------------------------------



Trading
On The Bolsa De Valores De Colombia



The BVC is the largest
stock exchange in Colombia for trading securities and derivatives. The BVC is a member of the World Federation of Exchanges and
the Federación Iberoamericana de Bolsas.



The BVC is the only exchange
where our common shares trade in Colombia. The table below sets forth the reported aggregate market capitalization of the companies
traded on the BVC, as of December 31, 2013.



|                  |  | Aggregate Market Capitalization of the BVC |        
|----------------- |  | ------------------------------------------ | -------
|                  |  | Market Capitalization                      |        
|                  |  | (Ps$ in billions)                          |        
|December 31, 2013 |  |                                            | 413,916








| | (1) | Representative Market Exchange Rate as of December 31, 2013.
| | --- | ------------------------------------------------------------



Registration and Transfer of Shares



Under Colombian law, transfers
of shares must be registered on the issuer’s stock ledger. Only those holders registered on the stock ledger are considered
by law as shareholders.



The shares are evidenced
in physical or electronic form.



Transfers of shares are
subject to a process for registration that differs depending on whether the shares are evidenced in physical or electronic form.



Transfers of shares
evidenced in electronic form required to be executed through the Colombia Stock Exchange. In Colombia, only the relevant
stockbrokers called sociedades comisionistas de bolsa are authorized to make the transfers of shares
through the Colombia Stock Exchange. The transfers of shares are registered in the Centralized Security
Deposit (Depósito Centralizado de Valores) or DECEVAL, through the relevant stockbrokers. DECEVAL records the
share transfer on its systems, in order to make the corresponding registration in the issuer stock ledger.



Transfers of shares evidenced
by physical certificates must be registered on the issuer’s stock ledger either by the transferor endorsing the certificates
to the buyer or by giving written instruction to the issuer to this effect.



Transfers of shares do
not require any fees to be paid to the issuer, but they may be subject to certain taxes, fees or charges which must be paid by
the holders to the stockbrokers.



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Under Colombian
legislation, if a transfer of shares for a value equivalent to or higher than 66,000 UVR must be made through the BVC if the
shares are registered with the BVC. Otherwise, shareholders can freely negotiate a transfer of shares.



Nevertheless, the following
transfers are not required to be executed through the BVC:



| | · | transfers between shareholders who are considered to be the same beneficial owner;
| | - | ----------------------------------------------------------------------------------



| | · | transfers of shares owned by financial institutions, under supervision of Superintendency of Finance,
that are in a liquidation process;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------



| | · | repurchases of shares by the issuer;
| | - | ------------------------------------



| | · | property delivered in lieu of payment, or payment of money or other valuable property, different than
the amount owed or demanded, in exchange for the extinguishment of the debt;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | transfers of shares made by the Nation or the Financial Institutions Warranty Fund (Fondo de Garantias
de Instituciones Financieras) or FOGAFIN;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------



| | · | transfers of shares issued abroad by Colombian companies, provided they take place outside Colombia;
| | - | ----------------------------------------------------------------------------------------------------



| | · | transfers of shares issued by foreign companies, offered through a public offer in Colombia, provided
that they take place outside Colombia; and
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------



| | · | any other transaction specifically authorized by the Superintendency of Finance to take place outside
the BVC.
| | - | --------------------------------------------------------------------------------------------------------------



For the purposes described
above, multiple transfer transactions made within one hundred twenty (120) calendar days, between the same parties on shares of
the same issuer and under similar conditions, are treated as a single transfer.



| | ITEM 10. | Additional Information
| | -------- | ----------------------



Bylaws



The following is a summary
of the material provisions of our bylaws. The last amendment of our bylaws was approved on March 21, 2013 by the shareholders,
which allows the Board of Directors to authorize the issuance and placement of non-convertible bonds as well as other debt securities.



The Bylaws are
contained in Public Deed No. 5314 of December 14, 2007, issued by the Second Notary of Bogotá; amended by Public Deed
No. 560 of May 23, 2011, issued by the Notary Forty- Six of Bogotá and the Deed No. 666 of May 7, 2013, issued by the
Notary Sixty-Five of Bogotá.



This summary does not
purport to be complete and is qualified by reference to our bylaws, which are filed as an exhibit to this annual report. For a
description of the provisions of our bylaws relating to our Board of Directors and its committees, see “Item 6. Directors,
Senior Management and Employees.”



Organization and Register



Ecopetrol was organized
on August 25, 1951, existing under the laws of Colombia. Since November 13, 2007, Ecopetrol has been a mixed economy company. We
are registered in the Chamber of Commerce of Bogotá (Cámara de Comercio de Bogotá) under registry number
899.999.068-1.



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Corporate Purpose



Pursuant to Article 4
of our bylaws, we may engage in the exploration, production, refining, transportation, storage, distribution and commercialization
of crude oil and its by-products in Colombia and abroad, and to support, promote and manage democratization programs and sales
of its equity in accordance with applicable rules. Our bylaws also authorize us to perform activities for the exploration and production
of crude oil in areas that prior to January 1, 2004 were operated by us directly or were subject to agreements subscribed by us;
to directly or indirectly explore and produce crude oil in areas assigned to us by the ANH; to directly or indirectly explore and
produce crude oil in areas assigned to us by a foreign regulatory entity; to buy, sell, import, export, store, blend, or distribute
hydrocarbons and its by-products in Colombia or abroad; to undertake research for developing and commercializing alternative energy
sources; and in general, to undertake any other activity instrumental or required to develop our corporate purpose. Our corporate
purpose includes administering and managing all properties that were formerly part of the De Mares concession.



Additionally, pursuant
to Article 5 of our bylaws, we may enter into all acts, contracts and legal business and activities that may be required for us
to adequately fulfill our corporate purpose.



Preference Rights and Restrictions Attaching
to Our Shares



We have only one class
of stock without special rights or restrictions. Our shareholders do not have any type of preemptive rights.



Under Commercial Colombian
law, our shareholders have the following economic privileges and voting rights:



| | · | to participate and vote on the decisions of the general shareholders’ meeting;
| | - | ------------------------------------------------------------------------------



| | · | to receive dividends based on the financial performance of the Company in proportion to their share
ownership;
| | - | --------------------------------------------------------------------------------------------------------------



| | · | to transfer and sell shares according to our bylaws and Colombian law;
| | - | ----------------------------------------------------------------------



| | · | to inspect corporate books and records 15 business days prior to the ordinary shareholders’
meeting where the year-end financial statements are to be approved;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | upon liquidation, to receive a proportional amount of the corporate assets after the payment of external
liabilities; and
| | - | -------------------------------------------------------------------------------------------------------------------------



| | · | to sell the shares, known as derecho de retiro, if a corporate restructuring affects the economic
or voting rights of the shareholders in the terms and conditions established under Colombian law.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Our bylaws and corporate
governance code provide additional rights to our minority shareholders. These rights include:



| | · | Sale of Assets. For a ten-year period counted from the date of subscription of the declaration
of the Nation dated July 26, 2007 or until the Nation loses its status as majority shareholder, the Nation guarantees that any
sale of 15% or more of our assets requires the approval of the general shareholders’ meeting and that the Nation would only
be allowed to vote its shares in favor of the proposal if 2% or more of our minority shareholders accept the proposal.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Candidate List. Pursuant to our bylaws and Law 1118 of 2006, the Nation will include in its
candidate list for election of members of the Board of Directors one member selected by the departments that produce hydrocarbons.
In addition, pursuant to the declaration of the Nation dated July 26, 2007, the Nation will include in its candidate list for election
of members of the Board of Directors one member selected by the ten largest minority shareholders. The minority shareholders’
right to select a candidate loses its effect when minority shareholders, according to their share participation, name a member
to our Board of Directors.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-130-







| | · | Extraordinary Meetings. Our bylaws and corporate governance code provide that the entity exercising
permanent control over Ecopetrol must instruct the Company’s CEO or External Auditor to call an extraordinary meeting of
the Company’s shareholders when so requested by a plurality of shareholders holding at least 5% of the total number of outstanding
shares. Such requests shall be made in writing and must clearly indicate the purpose of the meeting.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Investor Attention Office. Ecopetrol has an investor attention office, a specialized unit responsible
for receiving complaints from our shareholders. Pursuant to our bylaws, shareholders holding at least 5% of the total number of
shares outstanding may request that the investor attention office conduct a special audit of the following documents: the income
statement; the proposal for the distribution of profits; the report of the Board of Directors as to the economic and financial
status of our Company; the report from our general counsel as to the legal status of our Company; and the report from the independent
auditors. Special audits cannot be made of documents that contain scientific, technological or statistical information of our Company,
or agreement that gives us competitive and economic advantages over our competitors, or in respect of any document related to intellectual
property. Shareholders also have the right to propose good corporate governance recommendations to the office for the protection
of investors.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Others. Pursuant to our bylaws, shareholders holding at least 5% of the total number of shares
outstanding may propose recommendations to our Board of Directors pertaining to the management of our Company. Any shareholder
may file a written petition to our Board of Directors to investigate corporate governance violations that the shareholder believes
to have been committed.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Amendments to Rights and Restrictions
to Shares



We have only one class
of stock and it has no special rights or restrictions. Our shareholders do not have any type of preemptive rights. The rights given
to our shareholders by law are described in our bylaws and may only be modified through an amendment to the law.



The additional rights
given to our minority shareholders in our bylaws and corporate governance code may only be modified through an amendment of those
internal documents.



General Shareholders’ Meeting



Shareholders’ meetings
may be ordinary or extraordinary. Ordinary meetings will take place in our legal domicile located in Bogota, Colombia, within the
first three months following the end of each fiscal year, on the day and at the time set forth in the notice for the general shareholders’
meeting. The call for the general shareholders’ meeting may be made electronically or by written communication sent to each
shareholder. In both cases the call must be published in a newspaper of wide circulation 20 business days prior to the date on
which the meeting will take place.



In the ordinary general
shareholders’ meeting, our Board of Directors and the external auditor are appointed and our annual financial statements,
profit distribution, audit and management reports and any other matter provided under applicable law or our corporate bylaws are
approved.



Extraordinary meetings
of shareholders may be called by our Board of Directors, by our president or chief executive officer, by our external auditor,
or by shareholders holding at least 5% of the shares outstanding, or when unforeseen or urgent needs of the Company require it.
Calls to extraordinary meetings should be made at least eight days prior to the date of the meeting, with the exception of the
case where the Law requires a greater time between the summons and the meeting, and may be made electronically or by written communication
to each shareholder; in both cases the call must be published in a newspaper of wide circulation. The meeting notice must specify
the agenda for the meeting.



-131-







The required quorum for
both ordinary and extraordinary meetings is 50% plus one share entitled to vote and decisions are approved with a majority of the
members present. This quorum is exempted in the case of “second-call meetings,” which may take place when a meeting
fails to obtain the required quorum and is called within a period between 10 business days and 30 business days from the first
date, in which case decisions may be adopted by a majority of the shares present regardless of the number represented.



Decisions made at ordinary
and extraordinary shareholders’ meeting must be approved by a majority of the shares present. Colombian law requires supermajorities
in the following cases:



| | · | the vote of at least 70% of the shares present and entitled to vote at the ordinary shareholders’
meeting is required to approve the issuance of stock not subject to preemptive rights;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | the vote of at least 78% of the shares represented entitled to vote is required to approve the distribution
of less than 50% of the annual net profits. If the sum of all legal reserves (statutory, legal and optional) exceeds the amount
of the outstanding capital, the Company must distribute at least 70% of the annual net profits;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | the vote of at least 80% of the shares represented is required to approve the payment of dividends
in shares; and
| | - | -----------------------------------------------------------------------------------------------------------------



| | · | the vote of 100% of the outstanding and issued shares is required to replace a vacancy on the Board
of Directors without applying the electoral quotient system.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------



Shareholders may be represented
by proxies provided that the proxy: (1) is in writing (faxes and electronic documents are valid), (2) specifies the name of the
representative, (3) specifies the date or time of the meeting for which the proxy is given and (4) includes other information specified
by the applicable law. Proxies granted abroad do not require legalization or an apostille.



During our ordinary annual
shareholders’ meeting, our employees and Directors are only allowed to represent their own shares, unless they act as legal
representatives.



Limitations to the Rights to Hold Securities



There are no limitations
in our bylaws or Colombian law on the rights of Colombian residents or foreign investors to own the shares of our Company, or on
the right to hold or exercise voting rights with respect to those shares, except in cases of legal representation.



Restrictions on Change of Control Mergers,
Acquisitions or Corporate Restructuring of the Company



Under Colombian law and
our bylaws, the general shareholders’ meeting has full authority to approve any corporate restructuring, including any mergers,
acquisitions or spin-offs. Corporate restructurings are also subject to the requirement that the Nation must hold a minimum of
80% of our common stock at all times. While Law 1118 of 2006 is in effect, there cannot be any restructuring that results in a
change of control of our Company.



Ownership Threshold Requiring Public
Disclosure



Our corporate governance
code (chapter 1, Section 5, Identification of the Main Shareholders) provides that we must disclose periodically on our web page,
the names of the shareholders of our Company including, at least, the 20 shareholders with the greatest number of shares. We must
also disclose this information to the Superintendency of Finance at the end of each fiscal year.



Colombian securities regulations
set forth the obligation to disclose any material event or hecho relevante. Any transfer of shares equal or greater than
5% of our capital stock or any person acquiring a percentage of shares that would make him the beneficial owner of 5% or more of
our capital stock, is a material event, and therefore, must be disclosed to the Superintendency of Finance.



-132-







Changes in the Capital of the Company



There are no conditions
in our bylaws governing changes in our capital stock that are more stringent than those required under Colombian law, with the
exception that the Nation must hold a minimum of 80% of our capital stock at all times.



External Auditor



Pursuant to our bylaws,
our external auditor shall not be appointed for more than five consecutive one-year terms by us. However, an external auditor may
be hired again after two terms have passed since the conclusion of its last term of appointment. At the ordinary general shareholders’
meeting on March 26, 2014, the shareholders appointed Pricewaterhouse Coopers Ltd. as external auditor of Ecopetrol.



Material
Contracts



Transportation Agreement between
Ecopetrol and Empresa Colombiana de Gas ESP/Transportadora de Gas del Interior S.A. ESP



On October 6, 2006, we
entered into a natural gas transportation agreement with Empresa Colombiana de Gas ESP, or Ecogas, for the transportation of natural
gas from the Ballena terminal located in the La Guajira fields to the Barrancabermeja terminal. On February 27, 2007, Ecogas transferred
the rights and obligations under this agreement to Transportadora de Gas del Interior S.A. ESP, currently operating as Transportadora
de Gas Internacional S.A. ESP, or TGI. This agreement expired on November 30, 2012.



On October 1, 2008, Ecopetrol
and TGI signed a natural gas transportation agreement for the transportation of 116,500 thousand cfpd from December 1, 2012 to
December 31, 2020 of natural gas from the Ballena terminal located in the La Guajira fields to Barrancabermeja. Pursuant to the
terms of the agreement, we pay to TGI a regulated transportation tariff composed of a fixed fee, variable fee depending on transported
volumes and an administration, operation and maintenance fee. Payments for transported volume are made in Pesos. During 2013,
we paid Ps$136.6 billion to TGI under the agreement for the transportation services provided to us by TGI.



Transportation Agreement between
Ecopetrol and Ocensa



On March 31, 1995, we
entered into a crude oil transportation agreement with Ocensa. See “Item 7. Major Shareholders and Related Party Transactions—Related
Party Transactions—Agreements—Ocensa.”



Reficar



On December 30, 2011,
we entered into a construction support agreement pursuant to which we agreed to support Reficar’s costs and expenses related
to cost overruns and delays in construction. The project financing contract and the related guarantee are described in “Item
5. Operating and Financial Review and Prospects—Liquidity and Capital Resources.”



Oleoducto Bicentenario de Colombia
S.A.S.



In June 2012, we entered
into ship-or-pay and ship-and-pay crude oil transportation agreements with Oleoducto Bicentenario establishing a tariff and requires
the payment of Bicentenario’s indebtedness to local banks for twelve years. This tariff is collected through a trust, which
in turn is responsible for making the debt service payments to the banks. The duration of the ship-or-pay agreement is the earlier
of 12 years or when the debt has been entirely paid, and the duration of the ship-and-pay agreement is 20 years after the ship-or-pay
terminates. Under these agreements, Bicentenario has committed to transport at least 110 thousand bpd, of which the 55% of the
agreement volume is provided directly by Ecopetrol and 0.97% indirectly by Hocol.



-133-







Exchange
Controls



Payments in foreign currency
with respect to certain foreign exchange transactions including international investments between Colombian residents and non-Colombian
residents must by law be conducted through the commercial exchange market. Therefore, any foreign currency income or expenses under
the ADRs must be channeled through that market. Transactions conducted through the commercial exchange market are made at market
rates freely negotiated with authorized intermediaries (banks, financial corporations, administrators and others).



Foreign portfolio investments
must be made through authorized foreign exchange investment management companies. Only brokerage firms, trust companies and investment
management companies, subject to the inspection and supervision of the Superintendency of Finance, are allowed to make investments
in the local Colombian market on behalf of foreign investors. Such firms, trust companies and investment management companies also
act as the foreign investors’ local representatives for tax and foreign exchange purposes.



Colombian law provides
that the Colombian Central Bank may intervene in the foreign exchange market at its own discretion at any time. Likewise, from
time to time, the Colombian government introduces amendments to the International Investment Statute. The Colombian Central Bank
may also limit the remittance of dividends and/or investments of foreign currency received by Colombian residents whenever the
international reserves fall below an amount equal to three months of imports. We cannot assure you that the Colombian Central Bank
will not intervene in the future. However, since the establishment of the current foreign exchange regime in 1991, the Colombian
Central Bank has never taken such action except for a brief restriction by the national government in 2004. See “Item 3.
Key Information—Risk Factors—Risks relating to Colombia’s political and regional environment.”



Registration of foreign investment
represented in underlying shares



Colombia’s International
Investment Statute and the regulations issued by the Colombian Central Bank, which have been amended from time to time through
related decrees and regulations, regulate the manner in which non-Colombian resident entities and individuals can invest in Colombia
and participate in the Colombian securities markets. Among other requirements, the statute and regulations mandate registration
of foreign investment transactions with the Colombian Central Bank and specify procedures to authorize and administer such foreign
investment transactions. Additionally, pertinent information must be updated on a regular basis (yearly or monthly, depending on
the type of information).



Under these foreign investment
regulations, the failure of a foreign investor to report or register with the Colombian Central Bank foreign exchange transactions
relating to investments in Colombia on a timely basis may prevent the investor from obtaining remittance rights, constitute an
exchange control infraction, and result in a fine.



Foreign investors who
acquire ADRs are not required to register this investment with Colombian authorities. Holders of ADRs will benefit from the registration
to be obtained by the custodian for our common shares underlying the ADRs in Colombia. Such registration allows the custodian to
convert dividends and other distributions with respect to the common shares into foreign currency and remit the proceeds abroad.
If investors in ADRs choose to surrender their ADRs and withdraw common shares, they must retain an administrator for the investments
and register their investments in common shares as a portfolio investment through their local representative. The local representative
is the brokerage firm, trust company or investment management company that acts on behalf of the holders of the ADRs in Colombia,
and the request for registration is made by them.



Colombian residents who
acquire ADRs and either receive profits from this investment, surrender their ADRs or liquidate their investment in ADRs must register
these operations with the Colombian authorities and comply with applicable regulations through its Colombian brokerage firm.



-134-







In obtaining its own foreign
investment registration, an investor who surrenders its ADRs and sells common shares may incur expenses and/or suffer delays in
the application process. Investors would only be allowed to transfer dividends abroad or transfer funds received as distributions
relating to our common shares after their foreign investment registration procedure with the Colombian Central Bank has been completed.
In addition, the depositary’s foreign investment registration may also be adversely affected by future legislative changes,
but its rights to transfer dividends abroad or profits arising from distributions relating to our common shares must be maintained
according to Colombian law and foreign investment treaties entered into by Colombia in force at the time of the registration of
the investment, except when Colombia’s international reserves fall below an amount equivalent to three months’ worth
of imports.



Taxation



Colombian Tax Considerations



The following is a general
description of the Colombian tax considerations for investments in common shares in Colombia or for the purchase of ADSs, in a
foreign securities market. This description is based on applicable law in effect as of the date of this annual report, which may
be subject to change.



Prospective purchasers
of common shares or ADSs should consult their own tax advisors for a detailed analysis of the tax consequences resulting from the
acquisition, ownership and disposition of common shares or ADSs.



General Rules



Entities and individuals
who are residents or are domiciled in Colombia or are considered residents in Colombia for tax purposes are subject to Colombian
income tax on their worldwide income. Non-resident entities and non-resident individuals are subject to income tax in Colombia
solely on their Colombian-source income which, as a general rule, originates in the sale of assets located in the country at the
time of the sale, in the exploitation of tangible and intangible assets in Colombia, and in the rendering of services within the
Colombian territory. Double taxation treaties signed by Colombia, if applicable, provide for special rules regarding income tax.



For purposes of Colombian
taxation, an individual is a resident if he or she meets any of the following criteria:



| | (1) | remains in Colombia for more than 183 calendar days within any given 365-consecutive-day term;
| | --- | ----------------------------------------------------------------------------------------------



| | (2) | is related to the Colombian Government’s foreign service or to individuals who are at the Colombian
Government’s foreign service and who, by virtue of the Vienna Conventions on diplomatic and consular relations, is exempt
from taxes during the time of service; or
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | is a Colombian national and:
| | --- | ----------------------------



| | - | has a spouse or permanent companion, or dependent children, who are Residents, or
| | - | ---------------------------------------------------------------------------------



| | - | 50% or more of his or her total income is sourced in Colombia, or
| | - | -----------------------------------------------------------------



| | - | 50% or more of his or her assets are managed in Colombia, or
| | - | ------------------------------------------------------------



| | - | 50% or more of his or her assets are deemed to be located in Colombia, or
| | - | -------------------------------------------------------------------------



| | - | has failed to provide proof of residency in another country (different from Colombia) upon previous
official request by the Colombian tax office, or
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------



| | - | is a resident of a country deemed a tax haven under Colombian law. By Decree 2193 of October 7, 2013
the Government defined the States that are considered tax havens.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------



For purposes of Colombian
taxation, an entity is deemed to be a national, and, therefore, is subject to taxation in Colombia as a resident, if it meets any
of the following criteria:



-135-







| | (1) | it has its place of business or its place of effective management in Colombia during the corresponding
year or taxable period;
| | --- | ------------------------------------------------------------------------------------------------------------------------------



| | (2) | it has its main domicile in the Colombian territory; or
| | --- | -------------------------------------------------------



| | (3) | it has been incorporated in Colombia, in accordance with Colombian laws.
| | --- | ------------------------------------------------------------------------



Pursuant to the Colombian
Tax Statute, a foreign company or non-resident individual has a permanent establishment in Colombia when said company or individual
performs activities in Colombia through: (1) a fixed place of business (i.e., branches, factories or offices), or (2) an individual
who is not an independent agent empowered to execute agreements on behalf of the foreign company. Permanent establishments are
considered Colombian taxpayers in connection with the income and taxable gains attributed to said permanent establishment. A foreign
company or entity will not be deemed to have a permanent establishment by the sole fact that it acts through a broker or any other
independent agent.



Tax Treatment of a Non-Resident
of Colombia who Purchases an ADS in a Foreign Securities Market



Dividends



As a general rule, dividends
paid to foreign companies, foreign entities or non-Colombian residents who are investing in Colombian shares directly or through
a foreign investment capital fund, or FICF, are treated as Colombian-source income, and thus are subject to Colombian income tax.



To avoid double taxation,
dividends are not subject to tax at the shareholder level when they are paid out of corporate profits that have been previously
taxed at the corporate level. If the accounting or commercial earnings of a Colombian company exceed the profits subject to income
tax at the corporate level, then the excess distributed as dividends is subject to income tax at the shareholder level. If the
shareholder is a non-resident, the applicable tax rate is 33%. The regulation and decrees that govern the tax reform (Law 1607
of 2012, which entered into force on January 1, 2013) were enacted by the government in 2013.



If the shareholder is
a non-resident entity or a non-resident individual investing through an FICF on portfolio investments, the applicable withholding
tax rate is 25% and it is applied on the basis of the total amounts distributed, assuming that the dividends cannot be attributed
to a permanent establishment in Colombia belonging to the shareholder. Foreign shareholders subject to such withholding taxes are
not required to file an income tax return in Colombia.



Therefore, dividends distributed
out of taxed earnings at the corporate level to shareholders who are non-residents will be exempt from income and withholding taxes.
This exception does not apply in the case of distributions paid out of non-taxed earnings at the corporate level, which would be
subject to the 33% income tax rate.



Taxation of Capital Gains from the
sale of ADSs



Capital gains obtained
from the sale of ADSs by non-resident entities, Colombian individuals who are not residents in Colombia or foreign non-resident
individuals, are not subject to income tax in Colombia as such sale does not result in Colombian-source income to the extent that
the ADSs are not deemed to be owned in Colombia.



If the holder of the ADSs
who is a non-resident entity, a Colombian individual who is not a resident in Colombia or a foreign non-resident individual, decides
to surrender the ADSs and withdraw the underlying common shares, it is arguable that such transaction does not constitute a capital
gain subject to income tax in Colombia. However, different interpretations may be adopted by the Colombian Tax Authorities on this
matter.



-136-







Tax Treatment in Colombia of Non-Resident
Who Purchases Ecopetrol’s Shares in Colombia’s Securities Market



Dividends



As a general rule, dividends
paid to foreign companies or foreign entities, non-Colombian residents, who are investing in Colombian shares directly or through
a FICF are treated as Colombian-source income; thus, they are subject to Colombian income tax.



To avoid double taxation,
dividends are not subject to tax at the shareholder level when they are paid out of corporate profits that have been previously
taxed at the corporate level. If the accounting or commercial earnings of a Colombian company exceed the profits subject to income
tax at the corporate level, then the excess distributed as dividends is subject to income tax at the shareholder level. If the
shareholder is a non-Colombian resident, the applicable tax rate is 33%. The regulation and decrees that govern the tax reform
(Law 1607 of 2012, which entered into force on January 1, 2013) were enacted by the government in 2013.



If the shareholder is
a non-resident entity or a non-resident individual investing through a FICF on portfolio investments, the applicable withholding
tax rate is 25% and it is applied on the basis of the total amounts distributed, assuming that the dividends cannot be attributed
to a permanent establishment in Colombia belonging to the shareholder. Foreign shareholders subject to said withholding taxes are
not required to file an income tax return in Colombia.



Therefore, dividends distributed
out of taxed earnings at the corporate level to shareholders who are non-residents, will be exempt from income and withholding
taxes. This exception does not apply in the case of distributions paid out of non-taxed earnings at the corporate level, which
would be subject to the 33% income tax rate.



Taxation of Capital Gains for the
Sale of Shares



Capital gains obtained
in the sale of shares listed on the BVC and owned by the same beneficial owner, are not subject to income tax in Colombia, provided
that the shares sold during the taxable year do not represent more than 10% of the outstanding shares of the listed company. Pursuant
to Article 18 of Decree 2634 of 2012, sellers of shares are not required to file an income tax return for the transfer of securities
that are listed in the National Registry of Securities and Issuers (Registro Nacional de Valores y Emisoresor RNVE)
as long as the foreign investment is treated as a portfolio investment under article 3 of Decree 2080 of 2000.



If the above-mentioned
requirements are not met, the capital gain obtained in the sale of shares is subject to income tax or capital gains tax, under
the following rules:



| | · | The gain or loss arising therefrom will be equivalent to the difference between the sale price and
the tax basis of the shares. As a general rule, the tax basis of shares is equal to the price paid for such shares (i.e.,
cost of acquisition).
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | The applicable tax rate and the withholding tax rate have to be determined on a case-by-case basis.
| | - | ---------------------------------------------------------------------------------------------------



Tax Treatment of Non-Residents
Who Purchase Ecopetrol’s Shares in the BVC Market and Exchange Them for ADSs



Dividends



Payment of dividends made
from Colombia to a non-resident are subject to the tax treatment described above. Therefore, payments to holders of ADSs are not
subject to income, withholding or remittance taxes. Dividends paid to the Depositary of ADSs arising from Colombian shares are
not subject to taxation, unless dividends are paid out of earnings that were not taxed at the corporate level, in which case they
will be subject to income tax in Colombia at a 33% rate via withholding tax.



-137-







Taxation on Capital Gains for the
Sale of Shares



Assuming that the exchange
of securities is treated as a sale of Ecopetrol’s shares, the seller is subject to the tax treatment described above.



Therefore, capital gains
obtained in the sale of shares listed on the BVC and owned by the same beneficial owner, are not subject to income tax in Colombia,
provided that the shares sold during the taxable year do not represent more than 10% of the outstanding shares of the listed company.
Pursuant to Article 18 of Decree 2634 of 2012, sellers of shares are not required to file an income tax return for the transfer
of securities that are listed in the RNVE as long as the foreign investment is treated as a portfolio investment under article
3 of Decree 2080 of 2000.



If the abovementioned
requirements are not met, the capital gain obtained in the sale of shares is subject to income tax or capital gains tax, under
the following rules:



| | · | The gain or loss arising therefrom will be equivalent to the difference between the sale price and
the tax basis of the shares. As a general rule, the tax basis of shares is equal to the price paid for such shares (i.e.,
cost of acquisition).
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | The applicable tax rate and the withholding tax rate have to be determined on a case-by-case basis.
| | - | ---------------------------------------------------------------------------------------------------



U.S. Federal Income Tax Consequences



This summary describes
the principal U.S. federal income tax consequences of the ownership and disposition of common shares or ADSs, but it does not purport
to be a comprehensive description of all of the U.S. tax consequences that may be relevant to a decision to hold or dispose of
common shares or ADSs. This summary applies only to purchasers of common shares or ADSs who will hold the common shares or ADSs
as capital assets for tax purposes and does not apply to special classes of holders such as dealers in securities or currencies,
holders whose functional currency is not the U.S. dollar, holders of ten percent or more of our shares (taking into account shares
held directly or through depositary arrangements), tax-exempt organizations, financial institutions, holders liable for the alternative
minimum tax, securities traders who elect to account for their investment in common shares or ADSs on a mark-to-market basis, partnerships
or other pass-through entities, insurance companies, U.S. expatriates, persons that purchase or sell common shares or ADSs as part
of a wash sale for tax purposes, and persons holding common shares or ADSs in a hedging transaction or as part of a straddle, conversion
or other integrated transaction for U.S. federal income tax purposes. The statements regarding U.S. tax law set forth in this summary
is based on the Internal Revenue Code of 1986, as amended, which we call the “Code,” its legislative history, existing
and proposed regulations, published rulings and court decisions all as in force on the date of this annual report, and changes
to such law subsequent to the date of this annual report may affect the tax consequences described herein (possibly with retroactive
effect). This summary is also based in part on the representations of the Depositary and the assumption that each obligation in
the deposit agreement and any related agreement will be performed in accordance with its terms.



Each holder is encouraged
to consult such holder’s tax advisor concerning the overall tax consequences to it, including the consequences under laws
other than U.S. federal income tax laws, of an investment in common shares or ADSs.



In this discussion, references
to a “U.S. Holder” are to a beneficial holder of a common share or an ADS that is (1) a citizen or resident of the
United States, (2) a corporation, or any other entity taxable as a corporation, organized under the laws of the United States,
any state thereof or the District of Columbia, (3) an estate whose income is subject to United States federal income tax regardless
of its source, or (4) a trust if a United States court can exercise primary supervision over the trust's administration and one
or more United States persons are authorized to control all substantial decisions of the trust.



For United States federal
income tax purposes, holders of ADSs will generally be treated as owners of the common shares represented by such ADSs.



-138-







This discussion addresses
only United States federal income taxation. Holders of common shares or ADSs should consult their own tax advisor regarding the
United States federal, state and local and other tax consequences of owning and disposing of common shares and ADSs in their particular
circumstances.



Distributions on Common Shares or
ADSs



A distribution to U.S.
Holders made by us of cash or property with respect to common shares or ADSs generally will be treated as a dividend for U.S. federal
income tax purposes to the extent paid out of our current or accumulated earnings and profits (as determined under U.S. federal
income tax principles). Distributions in excess of our current or accumulated earnings and profits, as determined for United States
federal income tax purposes, will be treated first as a tax-free return of capital reducing such U.S. Holder’s adjusted tax
basis in the common shares or ADSs. Any distribution in excess of such adjusted tax basis will be treated as capital gain and will
be either long-term or short-term capital gain depending upon whether the U.S. Holder held the common shares or ADSs for more than
one year. Distributions of additional common shares or ADSs to U.S. Holders that are part of a pro rata distribution to all of
our shareholders generally will not be subject to U.S. federal income tax. We do not maintain calculations of our earnings and
profits under U.S. federal income tax principles, and, therefore, U.S. Holders should expect that any distributions generally will
be reported as dividends for U.S. federal income tax purposes. As used below, the term “dividend” means a distribution
that constitutes a dividend for U.S. federal income tax purposes.



The amount of any distribution
will include the amount of any Colombian tax withheld on the amount distributed, and the amount of a distribution paid in Pesos
will be measured by reference to the exchange rate for converting Pesos into U.S. dollars in effect on the date the distribution
is received by the Depositary (or by a U.S. Holder in the case of a holder of common shares) regardless of whether the payment
is in fact converted into U.S. dollars. If the Depositary (or U.S. Holder in the case of a holder of common shares) does not convert
such Pesos into U.S. dollars on the date it receives them, generally, any gain or loss resulting from currency exchange fluctuations
during the period from the date the dividend payment is included in income to the date the payment is converted into U.S. dollars
will be treated as ordinary income or loss and will not be eligible for the special tax rate applicable to qualified dividend income
(as discussed below). The gain or loss generally will be income or loss from sources within the United States for foreign tax credit
limitation purposes. Dividends paid by us will not be eligible for the dividends received deduction allowed to corporations under
the Code.



If you are a noncorporate
U.S. Holder, dividends that constitute qualified dividend income will be taxable to you at the preferential rates applicable to
long-term capital gains provided that you meet certain holding requirements. Dividends paid on the ADSs will be treated as qualified
dividend income if (1) the ADSs are readily tradable on an established securities market in the United States and (2) we were not,
in the year prior to the year in which the dividend was paid, and are not, in the year in which the dividend is paid, a passive
foreign investment company (PFIC). The ADSs are listed on the New York Stock Exchange, and will qualify as readily tradable on
an established securities market in the United States so long as they are so listed. Based on our audited financial statements
and relevant market and shareholder data, we believe that we were not treated as a PFIC for U.S. federal income tax purposes with
respect to our 2013 taxable year. In addition, based on our audited financial statements and our current expectations regarding
the value and nature of our assets, the sources and nature of our income, and relevant market and shareholder data, we do not anticipate
becoming a PFIC for the 2014 taxable year. However, this conclusion is a factual determination that is made annually and thus may
be subject to change. Based on existing guidance, it is not clear whether dividends received with respect to the common shares
will be treated as qualified dividends. In addition, the U.S. Treasury has announced its intention to promulgate rules pursuant
to which holders of ADSs or common shares and intermediaries through whom such securities are held will be permitted to rely on
certifications from issuers to treat dividends as qualified for tax reporting purposes. Because such procedures have not yet been
issued, it is not clear whether we will be able to comply with them. Holders of ADSs and common shares should consult their own
tax advisers regarding the availability of the reduced dividend tax rate in the light of the considerations discussed above and
their own particular circumstances.



-139-







A U.S. Holder will be
entitled, subject to a number of complex limitations and conditions, to claim a U.S. foreign tax credit in respect of any Colombian
income taxes withheld on dividends received on common shares or ADSs. U.S. Holders who do not elect to claim a credit for any foreign
income taxes paid during the taxable year may instead claim a deduction in respect of such Colombian income taxes provided the
U.S. Holder elects to deduct (rather than credit) all foreign income taxes for that year. Dividends received with respect to the
common shares or ADSs will be treated as foreign source income, subject to various classifications and other limitations. For the
purposes of the U.S. foreign tax credit limitations, the dividends paid with respect to our common shares or ADSs will generally
constitute either “passive” or “general” income. The rules relating to computing foreign tax credits
or deducting foreign income taxes are extremely complex, and U.S. Holders are urged to consult their own independent tax advisers
regarding the availability of foreign tax credits with respect to any Colombian income taxes withheld.



Sale, Exchange or Other Taxable
Dispositions of Common Shares or ADSs



A U.S. Holder generally
will recognize capital gain or loss upon the sale, exchange or other taxable disposition of common shares or ADSs in an amount
equal to the difference between the U.S. dollar value of the amount realized on the sale, exchange or other taxable disposition
of the common shares or ADSs and the U.S. Holder’s adjusted tax basis, determined in U.S. dollars, in the common shares or
ADSs. Any gain or loss will be long-term capital gain or loss if the common shares or ADSs have been held for more than one year.
Certain non-corporate U.S. Holders (including individuals) may be eligible for preferential rates of U.S. federal income tax in
respect of long-term capital gains. The deductibility of capital losses is subject to limitations under the Code.



If you are a U.S. Holder
of common shares or ADSs, the initial tax basis of your common shares or ADSs will be the U.S. dollar value of the Peso-denominated
purchase price determined on the date of purchase. If the common shares or ADSs are treated as traded on an “established
securities market,” a cash basis U.S. Holder, or, if it elects, an accrual basis U.S. Holder, will determine the dollar value
of the cost of such common shares or ADSs by translating the amount paid at the spot rate of exchange on the settlement date of
the purchase. If you convert U.S. dollars to Pesos and immediately use that currency to purchase common shares or ADSs, such conversion
generally will not result in taxable gain or loss to you.



With respect to the sale
or exchange of common shares or ADSs, the amount realized generally will be the U.S. dollar value of the payment received determined
on (1) the date of receipt of payment in the case of a cash basis U.S. Holder and (2) the date of disposition in the case of an
accrual basis U.S. Holder. If the common shares or ADSs are treated as traded on an “established securities market,”
a cash basis taxpayer, or, if it elects, an accrual basis taxpayer, will determine the U.S. dollar value of the amount realized
by translating the amount received at the spot rate of exchange on the settlement date of the sale.



Deposits and withdrawals
of common shares in exchange for ADSs, and ADSs for common shares generally will not result in the realization of gain or loss
for U.S. federal income tax purposes.



Backup Withholding and Information
Reporting



In general, dividends
on common shares or ADSs, and payments of the proceeds of a sale, exchange or other taxable disposition of common shares or ADSs,
paid within the United States, by a U.S. payor through certain U.S.-related financial intermediaries to a U.S. Holder are subject
to information reporting and may be subject to backup withholding at a current rate of 28% unless the holder (1) establishes that
it is a corporation or other exempt recipient or (2) with respect to backup withholding, provides an accurate taxpayer identification
number and certifies that it is a U.S. person and that no loss of exemption from backup withholding has occurred.



Backup withholding is
not an additional tax. The amount of any backup withholding tax from a payment to a U.S. Holder will be allowed as a credit against
the U.S. Holder’s U.S. federal income tax liability, provided that the required information is timely furnished to the Internal
Revenue Service (the “IRS”). A U.S. Holder generally may obtain a refund of any amounts withheld under the backup withholding
rules that exceed its U.S. federal income tax liability by timely filing a refund claim with the IRS.



U.S. Tax Considerations for Non-U.S.
Holders



A holder or beneficial
owner of common shares or ADSs that is not a U.S. Holder for U.S. federal income tax purposes (a “non-U.S. Holder”)
generally will not be subject to U.S. federal income or withholding tax on dividends received on common shares or ADSs, unless
the dividends are “effectively connected” with the non-U.S. Holder’s conduct of a trade or business within the
United States. In such a case a non-U.S. Holder generally will be taxed in the same manner as a U.S. Holder. In the case of “effectively
connected” dividends received by a corporate non-U.S. Holder, the corporate non-U.S. Holder may, under certain circumstances,
be subject to an additional “branch profits tax” at a 30% rate.



-140-







A non-U.S. Holder of common
shares or ADSs will not be subject to U.S. federal income or withholding tax on gain realized on the sale of common shares or ADSs,
unless (i) the gain is “effectively connected” with the non-U.S. Holder’s conduct of a trade or business in the
United States, or (ii) in the case of gain realized by an individual non-U.S. Holder, the non-U.S. Holder is present in the United
States for 183 days or more in the taxable year of the sale and certain other conditions are met. In the case of “effectively
connected” gains realized by a corporate non-U.S. Holder, the corporate non-U.S. Holder may, under certain circumstances,
be subject to an additional “branch profits tax” at a 30% rate.



Although non-U.S. Holders
generally are exempt from backup withholding and information reporting requirements, a non-U.S. Holder may be required to comply
with certification and identification procedures in order to establish its exemption from information reporting and backup withholding.



Documents
On Display



We file reports, including
annual reports on Form 20-F, and other information with the SEC pursuant to the rules and regulations of the SEC that apply to
foreign private issuers. You may read and copy any materials filed with the SEC in the SEC’s public reference room at 100
F Street, NE, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public
reference room. Any filings we make are also available to the public over the Internet at the SEC’s website at www.sec.gov
and at our website at www.ecopetrol.com.co. (This URL is intended to be an inactive textual reference only. It is not intended
to be an active hyperlink to our website. The information on our website, which might be accessible through a hyperlink resulting
from this URL, is not and shall not be deemed to be incorporated into this annual report.)



| | ITEM 11. | Quantitative and Qualitative Disclosures About Market
Risk
| | -------- | ----------------------------------------------------------



Risk Management and Financial Instruments



We are exposed to certain
risks associated with the nature of our operations and the financial instruments we use. Among those risks that affect our financial
assets, liabilities and expected future cash flows are the changes in commodity prices, currency exchange rates and interest rates.



Commodity price risk is
associated with our day-to-day operations as we export and import crude oil, natural gas, and refined products. We control our
exposure to commodity price volatility using the “cash flow at risk” methodology, under which we estimate the impact
that price fluctuations have over the liquidity of the company. When the amount of cash flow at risk is in excess of our established
risk tolerances, we may use derivative financial instruments such as options and swaps to hedge our exposure to volatility in commodity
prices. Additionally, we also occasionally use short-term hedges attached to cash flows to protect our financial statements from
price fluctuations. We do not use derivative financial instruments for speculative or profit-generating purposes.



Currency risk arises in
our operations because approximately 61% of our income is denominated in U.S. dollars and only 30% of our expenses are denominated
in the same currency, whereas our income and expenses denominated in Colombian Pesos are 39% and 70%, respectively. We control
our currency risk using natural hedging when possible, by maintaining funds in U.S. dollars and Pesos to meet our expenses in the
respective currencies. However, we have to sell U.S. dollars regularly in order to cover the currency mismatches that may arise.
We usually use derivative financial instruments such as forwards, futures and swaps depending on the impact of exchange rate on
our U.S. dollar-denominated obligations, which may affect the cash flow of the Company. This situation partially mitigates any
adverse effect that currency risk may have over our financial statements.



-141-









Interest rate risk arises from our exposure
to changes in interest rates, as we have floating-rate instruments in our investment portfolio and issuances of floating rate debt
linked to LIBOR, DTF and IPC rates. Thus, volatility in interest rates may affect the fair value and cash flows related to our
investments and floating rate debt. In 2013, our analysis of the situation about credit risk events and the global financial markets
drove us to decide not to hedge the interest rate risk. Nevertheless, our treasury office continuously monitors the performance
of interest rates and its impact on our financial statements. On the other hand, the exposure to interest rate risk of our fixed
income portfolio is controlled through its effective duration. The limits allowed for this item are between +/- 25% of the portfolio’s
benchmark duration. The trust funds linked to the pension obligations of the company (PAP)2 are also exposed to changes
in interest rates, as they include fixed- and floating-rate instruments that are marked to market. This exposure is continuously
monitored by our treasury office given the potential impact volatility may have on our financial statements. The treasury office’s
information is gathered from reports sent by the asset managers. These reports refer to regulatory limits as well as market, credit
and liquidity risks. It is important to mention that the investment guidelines of the PAPs are issued by the Colombian regulation
for pension funds, as stipulated in the Decree 941 of 2002 and Decree 1861 of 2012, where it is indicated that they have to follow
the same regime as the regular obligatory pension funds in their moderate (i.e., neither conservative nor aggressive) portfolio.



Investment Guidelines



Following Decree 1525
of 2008 which provides general rules on investments for public entities, our management established guidelines for our investment
portfolios. In general terms, they determined that we must invest our excess cash in fixed-income securities issued by entities
rated A or higher in the long term and A1/P1/F1 or higher in the short term (international scale) by Standard & Poor’s,
Moody’s or Fitch Ratings. We may invest in securities issued or guaranteed by the U.S. government or Colombian government.
In our Peso portfolio, we must invest in fixed-income securities of issuers rated AAA in the long term and F1+/BRC1+ in the short
term (local scale) by the previously mentioned rating agencies, except securities issued or guaranteed by the Colombian government.



Our investment portfolio
in U.S. dollars is segmented into four tranches, each one matching our liquidity needs. The working capital tranche is calculated
taking into account our cash flow needs for the next 60 days. The liquidity tranche is calculated as the contingent cash flow needs
over the working capital, taking into account the development of capital expenditures related to projects. The asset liability
tranche is built to match our long-term debt. The investment tranche includes the remaining amount of the total portfolio after
deducting the amounts pertaining to the above mentioned tranches and after subtracting the Peso portfolio.



Our investment portfolio
in Pesos is segmented in two tranches, each one matching our liquidity needs. The first tranche is calculated taking into account
our cash flow needs for the next 30 days, and the second tranche is built for investment purposes.



Sensitivity Analysis



The following table provides
information about our financial statements as of December 31, 2013 that may be sensitive to changes in West Texas Intermediate,
or WTI, prices and exchange rates:



|                                  |  | Income Statement 
2013 |           |  | Income Statement  Case WTI(1) + US$1 |  |           | Difference Between Real 2013 and Case WTI |  |  | Income Statement  Case TRM(2) - 1% |  |  | Difference Between Real 2013 and Case TRM |          
|--------------------------------- |  | ---------------------- | --------- |  | ------------------------------------ |  | --------- | ----------------------------------------- |  |  | ---------------------------------- |  |  | ----------------------------------------- | ---------
|                                  |  | (Pesos in Billions)    |          
|Local Revenue                     |  |                        | 26,207.90 |  |                                      |  | 26,395.46 |                                           |  |  | 187.56                             |  |  |                                           | 26,417.54
|Export Revenue                    |  |                        | 44,220.82 |  |                                      |  | 44,617.79 |                                           |  |  | 396.98                             |  |  |                                           | 44,622.98
|Total Revenue                     |  |                        | 70,428.71 |  |                                      |  | 71,013.25 |                                           |  |  | 584.54                             |  |  |                                           | 71,040.52
|Cost of Sales                     |  |                        | 42,554.28 |  |                                      |  | 42,770.93 |                                           |  |  | 216.65                             |  |  |                                           | 42,769.43
|Selling Operating Expenses        |  |                        | 4,921.55  |  |                                      |  | 4,921.55  |                                           |  |  | 0.00                               |  |  |                                           | 4,921.55 
|Administrative Operating Expenses |  |                        | 1,102.70  |  |                                      |  | 1,102.70  |                                           |  |  | 0.00                               |  |  |                                           | 1,102.70 
|Operating Profit                  |  |                        | 21,850.17 |  |                                      |  | 22,130.03 |                                           |  |  | 367.89                             |  |  |                                           | 22,246.83
|Non-Operating Income (Expenses)   |  |                        | -88.03    |  |                                      |  | -88.03    |                                           |  |  | 0.00                               |  |  |                                           | -88.03   
|Profit before Income Tax          |  |                        | 21,762.15 |  |                                      |  | 22,130.03 |                                           |  |  | 367.89                             |  |  |                                           | 22,158.80
|Income Tax                        |  |                        | -8,088.84 |  |                                      |  | -8,223.28 |                                           |  |  | -134.44                            |  |  |                                           | -8,234.36
|Minority Interest                 |  |                        | -686.87   |  |                                      |  | -686.87   |                                           |  |  | 0.00                               |  |  |                                           | -686.87  
|Net Income                        |  |                        | 12,986.44 |  |                                      |  | 13,222.15 |                                           |  |  | 235.71                             |  |  |                                           | 13,240.40








Notes:
The consolidation for the GE includes all subsidiaries. The scenarios include only Hocol, Equión, Savía Perú
and America Inc.

WTI= West
Texas Intermediate.

| | (1) | Average WTI for 2013 was US$97.91 per barrel.
| | --- | ---------------------------------------------

| | (2) | Average Market Representative Rate for 2013 was Ps$1,868.9 per US$1.00 on a calendar day basis.
| | --- | -----------------------------------------------------------------------------------------------














| | 2 | For further information regarding the trust funds linked to the pension obligations of the company, see Note 23 to our consolidated
financial statements.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------





-142-









Assumptions for the Sensitivity Analysis
of Financial Statements



| | · | The base scenario on which our sensitivity analysis is made corresponds to the Consolidated Statements
of Financial, Economic, Social and Environmental Activity or Income Statement for 2013, as presented elsewhere in this annual report.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | The sensitivity of the WTI price index is the increase of one U.S. dollar per barrel of crude oil
in the average WTI reference price based on a 365-day year for 2013. Prices assumed correspond to real prices for crude oil, natural
gas and refined products for 2013, adjusted to account for the differences between such real prices and the WTI reference price.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | The sensitivity of our results to changes in the exchange rates is the 1.96% average appreciation
of the Peso against the U.S. dollar during 2013. Prices assumed correspond to real prices of crude oil, natural gas and refined
products in 2013, proportionally adjusted to account for differences between actual and the monthly average exchange rate.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The table below sets forth
the line items that are being affected by the variation on the reference prices or the average exchange rate.



| | VARIATION ON WTI REFERENCE PRICE |  | VARIATION ON AVERAGE EXCHANGE RATE
| | -------------------------------- |  | ----------------------------------



| | OPERATING INCOME                      
| | --------------------------------------
| |                                       
| | Local Sales                           
| | Crude Oil                             
| | Refined products                      
| | Natural gas                           
| |                                       
| | Exports                               
| | Crude Oil                             
| | Refined products                      
| | Natural gas                           
| |                                       
| | COST OF SALES                         
| |                                       
| | Local purchases                       
| | Purchases from business partners      
| | Purchases of hydrocarbons from the ANH
| | Purchases of Natural gas              
| |                                       
| | Imports                               
| | Crude Oil                             
| | Products                              
| |                                       
| | NON-OPERATING INCOME                  
| |                                       
| |                                       



-143-







| | ITEM 12. | Description of Securities Other than Equity Securities
| | -------- | ------------------------------------------------------



| | ITEM 12.A. | Debt Securities
| | ---------- | ---------------



Not applicable.



| | ITEM 12.B. | Warrants and Rights
| | ---------- | -------------------



Not applicable.



| | ITEM 12.C. | Other Securities
| | ---------- | ----------------



Not applicable.



| | ITEM 12.D. | American Depositary Shares
| | ---------- | --------------------------



Fees and Charges
That a Holder of our ADSs May Have to Pay, Either Directly or Indirectly



JPMorgan Chase Bank, N.A.,
our Depositary, may charge each person to whom ADSs are issued, including, without limitation, issuances against deposits of shares,
issuances in respect of share distributions, rights and other distributions, issuances pursuant to a stock dividend or stock split
declared by us or issuances pursuant to a merger, exchange of securities or any other transaction or event affecting the ADSs or
deposited securities, and each person surrendering ADSs for withdrawal of deposited securities in any manner permitted by the deposit
agreement or whose ADRs are cancelled or reduced for any other reason, US$5.00 for each 100 ADS (or any portion thereof) issued,
delivered, reduced, cancelled or surrendered, as the case may be. The Depositary may sell (by public or private sale) sufficient
securities and property received in respect of a share distribution, rights and/or other distribution prior to such deposit to
pay such charge.



The Depositary collects
its fees for issuance and cancellation of ADSs directly from investors depositing shares or surrendering ADSs for the purpose of
withdrawal or from intermediaries acting for them. The Depositary collects fees for making distributions to investors by deducting
those fees from the amounts distributed or by selling a portion of distributable property to pay the fees. The Depositary may collect
its annual fee for Depositary services by deduction from cash distributions, or by directly billing investors, or by charging the
book-entry system accounts of participants acting for them. The Depositary may generally refuse to provide services to any holder
until the fees and expenses owing by such holder for those services or otherwise are paid.



The following additional
charges may be incurred by ADS holders, by any party depositing or withdrawing shares or by any party surrendering ADSs or to whom
ADSs are issued (including, without limitation, issuance pursuant to a stock dividend or stock split declared by us or an exchange
of stock regarding the ADRs or the deposited securities or a distribution of ADSs), whichever is applicable:



| | · | a fee of US$1.50 per ADR or ADRs for transfers of certificated or direct registration ADRs;
| | - | -------------------------------------------------------------------------------------------



| | · | a fee of up to US$0.02 per ADS for any cash distribution made pursuant to the deposit agreement;
| | - | ------------------------------------------------------------------------------------------------



| | · | a fee of US$0.05 per ADS per calendar year (or portion thereof) for services performed by the Depositary
in administering our ADR program (which fee may be charged on a periodic basis during each calendar year and shall be assessed
against holders of ADRs as of the record date or record dates set by the Depositary during each calendar year and shall be payable
in the manner described in the next succeeding provision);
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | any other charge payable by the Depositary, or any of the Depositary’s agents, including, without
limitation, the custodian, or the agents of the Depositary’s agents in connection with the servicing of our shares or other
deposited securities (which charge shall be assessed against registered holders of our ADRs as of the record date or dates set
by the Depositary and shall be payable at the sole discretion of the Depositary by billing such registered holders or by deducting
such charge from one or more cash dividends or other cash distributions);
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



-144-







| | · | a fee for the distribution of securities (or the sale of securities in connection with a distribution),
such fee being in an amount equal to the fee for the execution and delivery of ADSs which would have been charged as a result of
the deposit of such securities (treating all such securities as if they were shares) but which securities or the net cash proceeds
from the sale thereof are instead distributed by the Depositary to those holders entitled thereto;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | stock transfer or other taxes and other governmental charges;
| | - | -------------------------------------------------------------



| | · | cable, telex and facsimile transmission and delivery charges incurred at the ADS holder’s request;
| | - | --------------------------------------------------------------------------------------------------



| | · | transfer or registration fees for the registration of transfer of deposited securities on any applicable
register in connection with the deposit or withdrawal of deposited securities;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | expenses of the Depositary in connection with the conversion of foreign currency into U.S. dollars;
and
| | - | -------------------------------------------------------------------------------------------------------



| | · | such fees and expenses as are incurred by the Depositary (including, without limitation, expenses
incurred in connection with compliance with foreign exchange control regulations or any law or regulation relating to foreign investment)
in delivery of deposited securities or otherwise in connection with the Depositary’s or its custodian’s compliance
with applicable laws, rules or regulations.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



We will pay all other
charges and expenses of the Depositary and any agent of the Depositary (except the custodian) pursuant to agreements from time
to time between us and the Depositary. The fees described above may be amended from time to time.



Fees and Other Direct and Indirect Payments
Made by the Depositary to Us



Our Depositary has agreed
to reimburse us for certain expenses we incur that are related to establishment and maintenance of the ADR program, including investor
relations expenses and exchange application and listing fees. In 2013, the Depositary did not make reimbursements to us. During
the first quarter of 2014, reimbursements were made in the amount of approximately US$1,861,078.41 for expenses related to investor
relations expenses during 2013.



| | ITEM 13. | Defaults, Dividend Arrearages and Delinquencies
| | -------- | -----------------------------------------------



None.



| | ITEM 14. | Material Modifications to the Rights of Security Holders
and Use of Proceeds
| | -------- | ----------------------------------------------------------------------------



None.



| | ITEM 15. | Controls and Procedures
| | -------- | -----------------------



Disclosure Controls and Procedures



As required by Rules 13a-15(e)
and 15d-15(e) under the Securities Exchange Act of 1934, as of December 31, 2013, we evaluated the design and effectiveness
of our financial disclosure controls and procedures under the supervision and participation of our management, including our Chief
Executive Officer and Chief Financial Officer. There are inherent limitations to the effectiveness of any system of disclosure
controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures.
Accordingly, even if effective, disclosure controls and procedures can only provide reasonable assurance of achieving their control
objectives.



-145-







Based upon this evaluation,
our Chief Executive Officer and Chief Financial Officer concluded that as of the end of the period covered by this annual report,
our disclosure controls and procedures were effective to provide reasonable assurance that the information required to be disclosed
in the reports that we file and submit under the Securities Exchange Act of 1934 is recorded, summarized and reported as and when
required and is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer,
or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.



Management’s Annual Report on Internal
Control over Financial Reporting



Our management is responsible
for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15(d)-15(f)
under the Securities Exchange Act of 1934. Our internal control over financial reporting is a process designed under the supervision
of our Chief Executive Officer and Chief Financial Officer, and affected by our board of directors, management and other personnel,
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements
for external reporting purposes in accordance with generally accepted accounting principles, and it includes those policies and
procedures that:



| | · | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions
and dispositions of our assets;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------



| | · | provide reasonable assurance that transactions are recorded as necessary to permit preparation of
financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being
made only in accordance with authorization of our management and directors; and
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition,
use or disposition of our assets that could have a material effect on our financial statements.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Because of its inherent
limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, effective control over
financial reporting cannot, and does not, provide absolute assurance of achieving our control objectives. Also, projection of any
evaluation of the effectiveness of the internal controls to future periods is subject to the risk that controls may become inadequate
because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.



As of the year ended December
31, 2013, our management conducted an assessment of the effectiveness of our internal control over financial reporting in accordance
with the criteria established in 1992 in the publication “Internal Control – Integrated Framework,” issued by
the Treadway Commission’s Committee of Sponsoring Organizations (COSO), as well as the rules prescribed by the SEC in its
Final Rule “Management’s Report on Internal Control Over Financial Reporting and Certification of Disclosure in Exchange
Act Periodic Reports.”



Based on the assessment
performed, management concluded that our internal control over financial reporting was effective as of the end of the period covered
by this annual report.



The effectiveness of our
internal control over financial reporting has been audited by PricewaterhouseCoopers Ltda., an independent registered public accounting
firm, as stated in their audit report accompanying our consolidated financial statements.



Changes in Internal Control over Financial
Reporting



Effective on November
1, 2013, and as a result of a recruitment process, Ms. Magda Manosalva was appointed as Corporate Vice President of Finance and
Chief Financial Officer succeeding Ms. Adriana Echeverri, who remains with the Company as Corporate Vice President of Strategy
and Growth.



-146-







There were no changes
made in our internal control over financial reporting during the year ended December 31, 2013 that have materially affected
or are reasonably likely to materially affect the Company’s internal controls over financial reporting.



Attestation Report of the Registered
Public Accounting Firm



PricewaterhouseCoopers
Ltda.’s attestation report on our internal control over financial reporting is included in their audit report accompanying
our consolidated financial statements. See our consolidated financial statements.



| | ITEM 16. | [Reserved]
| | -------- | ----------



| | ITEM 16.A. | Audit Committee Financial Expert
| | ---------- | --------------------------------



Our Board of Directors
has determined that Luis Fernando Ramirez qualifies as an “audit committee financial expert,” and he is independent
under the definition of “independent” applicable to us under the rules of the NYSE (17 C.F.R. § 240.10A-3). See
“Item 6. Directors, Senior Management and Employees—Audit Committee.”



| | ITEM 16.B. | Code of Ethics
| | ---------- | --------------



We have adopted a code
of ethics within the meaning of this Item 16B of Form 20-F, which complies with applicable U.S. and Colombian law. Our code of
ethics applies to our chief executive officer, chief financial officer, principal accounting officer, persons performing similar
functions and other personnel. Our code of ethics is available on our website at http://www.ecopetrol.com.co/english/especiales/Ethics_Code2010_English/index_eng.html.
If we amend the provisions of our code of ethics that apply to our chief executive officer, our chief financial officer, our principal
accounting officer and persons performing similar functions, or if we grant any waiver of such provisions, we will disclose such
amendment or waiver on our website at the same address.



| | ITEM 16.C. | Principal Accountant Fees and Services
| | ---------- | --------------------------------------



Audit and
Non-Audit Fees



Our consolidated financial
statements for the fiscal year ended December 31, 2013 were audited by PricewaterhouseCoopers Ltda. and our consolidated financial
statements for the fiscal year ended December 31, 2012 were audited by KPMG Ltda.



The following table sets
forth the fees billed to us by PricewaterhouseCoopers Ltda. during the fiscal year ended December 31, 2013.



|                   |  | 2013 PricewaterhouseCoopers
 Ltda.                      |      
|------------------ |  | ------------------------------------------------------- | -----
|                   |  | (in millions of Pesos,  excluding 16% value added
 tax) |      
|Audit fees         |  |                                                         | 7,029
|Audit-related fees |  |                                                         | 378  
|Tax fees           |  |                                                         | 151  
|All other fees(1)  |  |                                                         | 384  
|Total              |  |                                                         | 7,942








| | (1) | They are comprised of coaching sessions in management skills dictated to officers of some affiliates
as well as participation in open training courses.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------



-147-







Audit Fees.The
audit fees listed in the table above are the aggregated fees billed by PricewaterhouseCoopers Ltda. in connection with their audits
of our annual consolidated financial statements (under Colombian Government Entity GAAP and U.S. GAAP), interim consolidated financial
statements (under Colombian Government Entity GAAP), audits of subsidiaries (under local GAAP) and periodic review of documents
filed with the SEC. In addition, these audit fees include fees related to our independent auditors’ audits of our internal
controls over financial reporting.



Audit-related Fees.The audit-related fees listed in the table above are those fees billed by PricewaterhouseCoopers Ltda. in connection with their
agreed-upon audit procedures of our variable compensation bonus system.



Tax Fee.The tax
fees listed in the table above correspond to (1) assisting some subsidiaries in the preparation of the income tax return and information
submitted in magnetic means, (2) preparation of the income tax returns and information for submission in magnetic means for some
expatriate officers of the Company, and (3) review of compliance with transfer pricing obligations.



The following table sets
forth the fees billed to us by KPMG Ltda. during the fiscal years ended December 31, 2013 and 2012, respectively.



|                   |  | As of December 31,                                     |      
|------------------ |  | ------------------------------------------------------ | -----
|                   |  | 2013 KPMG Ltda.                                        |      
|                   |  | (in millions of pesos,  excluding 16% value added tax) |      
|Audit fees         |  |                                                        | 1,338
|Audit-related fees |  |                                                        |      
|Tax fees           |  |                                                        |      
|All other fees(1)  |  |                                                        |      
|Total              |  |                                                        | 1,338








| | (1) | Provision of advice that helps Ecopetrol develop its documents, procedures and policies related
to Business Continuity Planning in certain areas of the organization.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------



Audit Fees.The
audit fees listed in the table above are the aggregated fees billed by KPMG Ltda. in connection with their audits of our annual
consolidated financial statements (under Colombian Government Entity GAAP and U.S. GAAP), interim consolidated financial statements
(under Colombian Government Entity GAAP), subsidiary audits (under local GAAP) and review of periodic documents filed with the
SEC. In addition, these audit fees include fees related to our independent auditors’ audits of our internal controls over
financial reporting.



Audit-related Fees.The audit-related fees listed in the table above are the fees billed by KPMG Ltda. in connection with their agreed-upon procedures
of our variable compensation bonus system.



Tax Fee.The tax
fees listed in the table above correspond to (1) assisting some subsidiaries in the preparation and filing of appropriate tax returns
with the tax authorities (including electronic filings), (2) advising some subsidiaries about the tax consequences associated with
new or proposed legislation and (3) rendering advice to some subsidiaries on the likely tax consequences of proposed transactions
and the appropriate methods of structuring and reporting.



Audit Committee Approval Policies and
Procedures



Our audit committee approves
on a case-by-case basis any engagement of our external independent auditors to provide services different than those related to
auditing our financial statements. Occasionally, the Audit Committee will have no doubt that these additional services do not compromise
the external auditor’s independence. When in doubt, the Committee will request the opinion of the internal auditor.



-148-







| | ITEM 16.D. | Exemptions from the Listing Standards for Audit Committees
| | ---------- | ----------------------------------------------------------



Not applicable.



| | ITEM 16.E. | Purchases of Equity Securities by the Issuer and Affiliated
Purchasers
| | ---------- | ----------------------------------------------------------------------



None.



| | ITEM 16.F. | Change in Registrant’s Certifying Accountant
| | ---------- | --------------------------------------------





Not applicable.





| | ITEM 16.G. | Corporate Governance
| | ---------- | --------------------



Pursuant to the requirements
of Section 303A.11 of the NYSE’s Listed Company Manual, the following is a summary of the significant differences between
our corporate governance practices and those required for U.S. companies under the NYSE listing standards.





-149-







|NYSE Standards                                                                                                                                                                                                                                                                                                                                       |  | Our Corporate Governance Practices                                                                                                                                                                                                                                                                                                                                                                                                                                         
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Director Independence                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|The majority of the board of directors must be independent. §303A.01. “Controlled companies,” which would include Ecopetrol if we were a U.S. issuer, are exempt from this requirement. A controlled company is one in which more than 50% of the voting power is held by an individual, group or another company, rather than the public. §303A.00. |  | Law 964 of 2005 establishes that (1) the board of directors of listed companies must be comprised of a minimum of five directors and a maximum of ten directors and (2) at least 25% of board members must be independent. Under our corporate governance guidelines, our board of directors must be comprised of nine directors, of which at least three must be independent. As of the date of this annual report, we have six (6) independent directors.                
|                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Executive Sessions                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|The non-management directors of each listed company must meet at regularly scheduled executive sessions without management. §303A.03.                                                                                                                                                                                                                |  | A comparable rule does not exist under Colombian law. Except for our Audit Committee, our Board of Directors does not meet without management.                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Nominating/Corporate Governance and Sustainability Committee                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|A nominating/corporate governance and sustainability committee composed entirely of independent directors is required. The committee must have a charter specifying the purpose, duties and evaluation procedures of the committee. §303A.04. “Controlled companies” are exempt from these requirements. §303A.00.                                   |  | Colombian law does not require the establishment of a nominating and corporate governance and sustainability committee composed entirely of independent directors. Pursuant to our bylaws, both our corporate governance and sustainability committee and our nomination and compensation committee shall be composed of at least one independent director that acts pursuant to a written charter.                                                                        
|                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Compensation Committee                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|A compensation committee composed entirely of independent directors is required, which must evaluate and approve executive officer compensation. The committee must have a charter specifying the purpose, duties and evaluation procedures of the committee. §303A.05. “Controlled companies” are exempt from this requirement. §303A.00.           |  | Colombian law does not require the establishment of a compensation committee composed entirely of independent directors. Pursuant to our bylaws, our nomination and compensation committee shall be composed of at least one independent director who acts pursuant to a written charter.                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Audit Committee                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|An audit committee with a minimum of three independent directors satisfying the independence and other requirements of Rule 10A-3 under the Exchange Act and the more stringent requirements under the NYSE standards is required. §§303A.06 and 303A.07.                                                                                            |  | According to Law 964 of 2005, Colombian companies that are authorized to issue securities by the Superintendency of Finance must have an audit committee that satisfies the requirements of Law 964 of 2005, including its minimum number of members, independence criteria and audit related duties. Our audit committee is composed entirely of independent directors, and the committee meets the requirements of Law 964 of 2005 and Rule 10A 3 under the Exchange Act.



-150-







|NYSE Standards                                                                                                                                                                                                                                                                          |  | Our Corporate Governance Practices                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Equity Compensation Plans                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Equity compensation plans and all material revisions thereto require shareholder approval, subject to limited exemptions. §§303A.08 and 312.03.                                                                                                                                         |  | Under Colombian law, no similar right to vote on equity compensation plans and material revisions thereto is given to shareholders. We do not give our shareholders the right to vote on equity compensation plans and material revisions thereto.                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Corporate Governance Guidelines                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Listed companies must adopt and disclose corporate governance guidelines. §303A.09.                                                                                                                                                                                                     |  | The Superintendency of Finance does recommend the adoption of corporate governance guidelines. However, according to Superintendency of Finance Circular No. 007/2011, the adoption of corporate governance guidelines is voluntary. Listed companies must annually publish a corporate governance survey comparing their corporate governance standards with those recommended by the Superintendency of Finance. Our corporate governance guidelines (Code of Good Corporate Governance) are listed on our website at http://www.ecopetrol.com.co.
|                                                                                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Code of Ethics for Directors, Officers and Employees                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Corporate governance guidelines and a code of business conduct and ethics is required, with disclosure of any waiver for directors or executive officers. The code must contain compliance standards and procedures that will facilitate the effective operation of the code. §303A.10. |  | We have adopted a code of ethics which complies with applicable U.S. and Colombian law. Our code of ethics applies to our chief executive officer, chief financial officer, principal accounting officer, persons performing similar functions and generally to all the employees, members of the board of directors, suppliers, and contractors of Ecopetrol S.A. and its corporate group. Our code of ethics is available on our website at http://www.ecopetrol.com.co.                                                                          



| | ITEM 16.H. | Mine Safety Disclosure
| | ---------- | ----------------------



Not applicable.



| | ITEM 17. | Financial Statements
| | -------- | --------------------



Not applicable.



| | ITEM 18. | Financial Statements
| | -------- | --------------------



See our audited consolidated
financial statements beginning on page F-1, incorporated herein by reference.



| | ITEM 19. | Exhibits
| | -------- | --------



|Exhibit
        No. |  | Description                                                                                                                                                                                                                                                                                           
|------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1.1                 |  | Amended and Restated Bylaws of Ecopetrol, S.A., dated March 21, 2013, as recorded under Public Deed No. 666 of May 7, 2013 (incorporated by reference to Exhibit 3.1 on Form F-3 filed with the U.S. Securities and Exchange Commission on July 26, 2013 (File No. 333-190198)) (English Translation).
|                    |  |                                                                                                                                                                                                                                                                                                       
|4.1                 |  | Transportation Agreement between Ecopetrol S.A. and Oleoducto Central S.A., dated March 31, 1995 (incorporated by reference to Exhibit 4.1 on Form 20-F filed with the U.S. Securities and Exchange Commission on September 12, 2008 (File No. 001-34175)) (English Translation).                     



-151-







|Exhibit
        No. |  | Description                                                                                                                                                                                                                                                                                                                                                                    
|------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.2                 |  | Supplementary Agreement to Transportation Agreement between Ecopetrol S.A. and Oleoducto Central S.A., dated January 13, 2013 (incorporated by reference to Exhibit 4.2 on Form 20-F filed with the U.S. Securities and Exchange Commission on April 29, 2013 (File No. 001-34175)) (English Translation).                                                                     
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|4.3                 |  | Natural Gas Transportation Agreement between Ecopetrol S.A. and Transportadora de Gas del Interior S.A. ESP, dated October 1, 2008 (incorporated by reference to Exhibit 4.3 on Form 20-F filed with the U.S. Securities and Exchange Commission on April 29, 2013 (File No. 001-34175)) (English Translation).                                                                
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|4.4                 |  | Supplementary Agreement No. 1, dated December 5, 2008, to the Natural Gas Transportation Agreement between Ecopetrol S.A. and Transportadora de Gas del Interior S.A. ESP, dated October 1, 2008 (incorporated by reference to Exhibit 4.4 on Form 20-F filed with the U.S. Securities and Exchange Commission on April 29, 2013 (File No. 001-34175)) (English Translation).  
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|4.5                 |  | Supplementary Agreement No. 2, dated April 11, 2012, to the Natural Gas Transportation Agreement between Ecopetrol S.A. and Transportadora de Gas Internacional S.A. E.S.P., dated October 1, 2008 (incorporated by reference to Exhibit 4.5 on Form 20-F filed with the U.S. Securities and Exchange Commission on April 29, 2013 (File No. 001-34175)) (English Translation).
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|4.6                 |  | Crude Oil Transportation Services Agreement between Ecopetrol S.A. and Cenit Transporte y Logística de Hidrocarburos S.A.S., dated April 1, 2013 (incorporated by reference to Exhibit 4.6 on Form 20-F filed with the U.S. Securities and Exchange Commission on April 29, 2013 (File No. 001-34175)) (English Translation).                                                  
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|4.7                 |  | Refined Products Transportation Services Agreement between Ecopetrol S.A. and Cenit Transporte y Logística de Hidrocarburos S.A.S., dated April 1, 2013 (incorporated by reference to Exhibit 4.7 on Form 20-F filed with the U.S. Securities and Exchange Commission on April 29, 2013 (File No. 001-34175)) (English Translation).                                           
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|4.8                 |  | Indenture, dated as of July 23, 2009, between the Company and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.2 to the Company’s Form F-4 filed with the U.S. Securities and Exchange Commission on July 31, 2009 (File No. 333-160965)).                                                                                                      
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|4.9                 |  | Bicentenario Transport Contract between Oleoducto Bicentenario de Colombia S.A.S. and Ecopetrol S.A.,
dated June 20, 2012 (English Translation).                                                                                                                                                                                                                               
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|8.1                 |  | List of subsidiaries of Ecopetrol S.A.                                                                                                                                                                                                                                                                                                                                         
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|12.1                |  | Section 302 Certification of the Chief Executive Officer.                                                                                                                                                                                                                                                                                                                      
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|12.2                |  | Section 302 Certification of the Chief Financial Officer.                                                                                                                                                                                                                                                                                                                      
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|13.1                |  | Section 906 Officer Certification.                                                                                                                                                                                                                                                                                                                                             
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|15.1                |  | Consent letter of PricewaterhouseCoopers Ltda.                                                                                                                                                                                                                                                                                                                                 
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|15.2                |  | Consent letter of KMPG Ltda.                                                                                                                                                                                                                                                                                                                                                   
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|15.3                |  | Consent letter of Ryder Scott Company, L.P.                                                                                                                                                                                                                                                                                                                                    
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|15.4                |  | Consent letter of Gaffney, Cline & Associates, Inc.                                                                                                                                                                                                                                                                                                                            
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|15.5                |  | Consent letter of DeGolyer and MacNaughton.                                                                                                                                                                                                                                                                                                                                    
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|99.1                |  | Third-Party Reserve Report of Ryder Scott Company, L.P.                                                                                                                                                                                                                                                                                                                        
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|99.2                |  | Third-Party Reserve Report of Gaffney, Cline & Associates, Inc.                                                                                                                                                                                                                                                                                                                
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                
|99.3                |  | Third-Party Reserve Report of DeGolyer and MacNaughton.                                                                                                                                                                                                                                                                                                                        



-152-







The amount of long-term
debt securities of Ecopetrol authorized under any given instrument does not exceed 10% of its total assets on a consolidated basis.
Ecopetrol hereby agrees to furnish to the SEC, upon its request, a copy of any instrument defining the rights of holders of its
long-term debt or of its subsidiaries for which consolidated or unconsolidated financial statements are required to be filed.



-153-







SIGNATURES



The registrant hereby
certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned
to sign this annual report on its behalf.



|                       | Ecopetrol S.A.
|---------------------- | --------------
|                       |               
|                       | By:           
|                       |               
|                       |               
|                       |               
|                       | By:           
|                       |               
|Dated:  April 25, 2014 |               



-154-









Ecopetrol S.A. and Subsidiaries



Consolidated Financial Statements



Years ended December 31, 2013, 2012
and 2011



F-1







Ecopetrol S.A. and Subsidiaries



Consolidated Financial Statements



Years ended December 31, 2013, 2012
and 2011



Contents



|Report
    of Independent Registered Public Accounting Firm – PricewaterhouseCoopers Ltda | F-3
|----------------------------------------------------------------------------------------- | ---
|                                                                                          |    
|Report of Independent
    Registered Public Accounting Firm –KPMG Ltda                    | F-4
|                                                                                          |    
|Consolidated Balance
    Sheets                                                           | F-5
|                                                                                          |    
|Consolidated Statements
    of Financial, Economic, Social and Environmental Activities   | F-6
|                                                                                          |    
|Consolidated Statements
    of Changes in Shareholders’ Equity                            | F-7
|                                                                                          |    
|Consolidated Statements
    of Cash Flows                                                 | F-8
|                                                                                          |    
|Notes to Consolidated
    Financial Statements                                            | F-9



F-2









Report of Independent Registered Public
Accounting Firm



To the Board of Directors

and Shareholders of Ecopetrol S. A.





In our opinion, the accompanying consolidated
balance sheet and the related consolidated statements of financial, economic, social and environmental activities, of changes in
shareholders’ equity and of cash flows present fairly, in all material respects, the financial position of Ecopetrol S. A.
and its subsidiaries (the “Company”) at December 31, 2013, and the results of their operations and their cash flows
for the year ended December 31, 2013, in conformity with generally accepted accounting principles for Colombian Government Entities
issued by the Contaduría General de la Nación. Also in our opinion, the Company maintained, in all material respects,
effective internal control over financial reporting as of December 31, 2013, based on criteria established in Internal Control
- Integrated Framework 1992 issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's
management is responsible for these financial statements, for maintaining effective internal control over financial reporting and
for its assessment of the effectiveness of internal control over financial reporting, included in Item 15 of this Form 20-F as
of December 31, 2013. Our responsibility is to express an opinion on these financial statements and on the Company's internal control
over financial reporting based on our integrated audit. We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement and whether effective internal control over financial
reporting was maintained in all material respects. Our audit of the financial statements included examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting
included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists,
and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also
included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinions.





Generally accepted accounting principles
for Colombian Government Entities vary in certain significant respects from accounting principles generally accepted in the United
States of America. Information relating to the nature and effect of such differences is presented in Note 35 to the consolidated
financial statements.



A company’s internal control over
financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and
the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s
internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with
authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or
timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect
on the financial statements.



Because of its inherent limitations, internal
control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness
to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree
of compliance with the policies or procedures may deteriorate



/s/ PricewaterhouseCoopers Ltda.



Bogotá, Colombia

April 25, 2014



F-3







Report of Independent Registered Public
Accounting Firm



To the Board of Directors and Shareholders
of

Ecopetrol S.A.:



We have audited the accompanying consolidated
balance sheets of Ecopetrol S.A. and subsidiaries (the “Company”) as of December 31, 2012, and the related consolidated
statements of Financial, Economic, Social and Environmental Activities, Changes in Stockholders’ Equity, and Cash Flows for
the years ended December 31, 2012 and 2011. Our responsibility is to express an opinion on these consolidated financial statements
based on our audits.



We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. Our audits
of the consolidated financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating
the overall financial statement presentation. Our audits also included performing such other procedures as we considered necessary
in the circumstances. We believe that our audits provide a reasonable basis for our opinion.



In our opinion, the consolidated financial
statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31,
2012 and 2011, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles
generally accepted in Colombia, promulgated by the National Accounting Office (Contaduría General de la Nación or
CGN).



Accounting principles generally accepted
for Colombian Government Entities vary in certain significant respects from accounting principles generally accepted in the United
States of America. Information relating to the nature and effects of such differences is presented in Note 34 to the consolidated
financial statements.



/s/ KPMG Ltda.



Bogotá, Colombia

April 29, 2013



F-4







ECOPETROL S.A. and Subsidiaries

Consolidated Balance Sheets

As of December 31, 2013 and 2012

(Expressed in millons of Colombian pesos)



|                                                      |  | 2013 |              |   | 2012 |  
|----------------------------------------------------- |  | ---- | ------------ | - | ---- | -
|Assets                                                |  |      |              |   |      |  
|                                                      |  |      |              |   |      |  
|Current assets:                                       |  |      |              |   |      |  
|Cash and cash equivalents (notes 2 and 3)             |  | $    | 8,841,438    |   |      | $
|Investments (notes 2 and 4)                           |  |      | 1,659,308    |   |      |  
|Accounts and notes receivable, net (notes 2 and 5)    |  |      | 6,176,891    |   |      |  
|Inventories, net (note 6)                             |  |      | 3,259,399    |   |      |  
|Advances and deposits (notes 2 and 7)                 |  |      | 8,614,050    |   |      |  
|Prepaid expenses (note 8)                             |  |      | 148,344      |   |      |  
|Deferred tax assets (note 17)                         |  |      | 27,732       |   |      |  
|Total current assets                                  |  | $    | 28,727,162   |   |      | $
|                                                      |  |      |              |   |      |  
|Long term assets:                                     |  |      |              |   |      |  
|Investments (notes 2 and 4)                           |  | $    | 1,587,598    |   |      | $
|Accounts and notes receivable, net (notes 2 and 5)    |  |      | 520,056      |   |      |  
|Advances and deposits (notes 2 and 7)                 |  |      | 192,613      |   |      |  
|Deposits held in trust (note 9)                       |  |      | 478,745      |   |      |  
|Property, plant and equipment, net (note 10)          |  |      | 44,998,680   |   |      |  
|Natural and environmental resources, net (note 11)    |  |      | 21,456,659   |   |      |  
|Deferred charges (notes 12 and 17)                    |  |      | 4,004,790    |   |      |  
|Other assets (notes 2 and 13)                         |  |      | 3,500,595    |   |      |  
|Valuations (note 14)                                  |  |      | 26,961,096   |   |      |  
|Total assets                                          |  | $    | 132,427,994  |   |      | $
|                                                      |  |      |              |   |      |  
|Liabilities and Shareholders' Equity                  |  |      |              |   |      |  
|Current liabilities:                                  |  |      |              |   |      |  
|Financial obligations (notes 2 and 15)                |  | $    | 774,559      |   |      | $
|Accounts payable and related parties (notes 2 and 16) |  |      | 9,539,934    |   |      |  
|Taxes, contributions and duties payable (note 17)     |  |      | 9,159,183    |   |      |  
|Deferred tax liabilities (note 17)                    |  |      | 24,318       |   |      |  
|Labor and pension liabilities (note 18)               |  |      | 289,628      |   |      |  
|Estimated liabilities and provisions (notes 2 and 19) |  |      | 2,515,005    |   |      |  
|Total current liabilities                             |  | $    | 22,302,627   |   |      | $
|                                                      |  |      |              |   |      |  
|Long term liabilities:                                |  |      |              |   |      |  
|Financial obligations (notes 2 and 15)                |  | $    | 21,423,992   |   |      | $
|Accounts payable and related parties (notes 2 and 16) |  |      | 591,998      |   |      |  
|Labor and pension liabilities (note 18)               |  |      | 4,277,831    |   |      |  
|Taxes, contributions and duties payable (note 17)     |  |      | -            |   |      |  
|Estimated liabilities and provisions (notes 2 and 19) |  |      | 5,163,819    |   |      |  
|Other long-term liabilities (notes 2 and 20)          |  |      | 2,974,776    |   |      |  
|Total liabilities                                     |  | $    | 34,432,416   |   |      | $
|                                                      |  |      |              |   |      |  
|Non-controlling interests (note 21)                   |  | $    | 4,573,748    |   |      | $
|Shareholders' equity:                                 |  |      |              |   |      |  
|(Note 22 and see attached statement)                  |  |      | 71,119,203   |   |      |  
|Total liabilities and shareholders' equity            |  | $    | 132,427,994  |   |      | $
|                                                      |  |      |              |   |      |  
|Memorandum accounts (note 23)                         |  |      |              |   |      |  
|Debtors                                               |  |      | 152,210,701  |   |      |  
|Creditors                                             |  | $    | (111,774,620 | ) |      | $



The accompanying notes are an integral
part of the Consolidated Financial Statements



F-5







ECOPETROL S.A. and Subsidiaries

Consolidated Statements of Financial,
Economic, Social and Environmental Activities

For the years ended December
31, 2013, 2012 and 2011

(Expressed in millions of Colombian
pesos, except for net income per share

which is expressed in Colombian
pesos)



|                                                      |  | 2013 |            |   | 2012 |   |            | 2011 | 
|----------------------------------------------------- |  | ---- | ---------- | - | ---- | - | ---------- | ---- | 
|Revenues (note 24):                                   |  |      |            |   |      |   |            |      | 
|Domestic sales                                        |  | $    | 26,207,899 |   |      | $ | 24,361,913 |      | 
|Foreign sales                                         |  |      | 44,220,815 |   |      |   | 44,490,089 |      | 
|Total revenues                                        |  | $    | 70,428,714 |   |      | $ | 68,852,002 |      | 
|                                                      |  |      |            |   |      |   |            |      | 
|Cost of sales (note 25)                               |  |      | 42,554,282 |   |      |   | 40,535,508 |      | 
|Gross margin                                          |  | $    | 27,874,432 |   |      | $ | 28,316,494 |      | 
|Operating expenses (note 26):                         |  |      |            |   |      |   |            |      | 
|Administration                                        |  |      | 1,455,717  |   |      |   | 874,980    |      | 
|Operation and projects                                |  |      | 4,583,986  |   |      |   | 4,098,610  |      | 
|Operating income                                      |  | $    | 21,834,729 |   |      | $ | 23,342,904 |      | 
|                                                      |  |      |            |   |      |   |            |      | 
|Non-operating income (expenses):                      |  |      |            |   |      |   |            |      | 
|Financial income (expenses), net (note 27)            |  |      | 45,653     |   |      |   | (167,889   | )    | 
|Pension expenses (note 18 and 28)                     |  |      | (478,737   | ) |      |   | (948,455   | )    | 
|Inflation gain (note 29)                              |  |      | 155        |   |      |   | 97,663     |      | 
|Other income (expenses), net (note 30)                |  |      | 480,407    |   |      |   | 7,478      |      | 
|Income before income tax and non-controlling interest |  | $    | 21,882,207 |   |      | $ | 22,331,701 |      | 
|                                                      |  |      |            |   |      |   |            |      | 
|Current income tax (note 17)                          |  |      | 8,291,571  |   |      |   | 7,095,874  |      | 
|Deferred income tax (note 17)                         |  |      | (202,733   | ) |      |   | 37,521     |      | 
|Income before non-controlling interest                |  | $    | 13,793,369 |   |      |   | 15,198,306 |      | 
|                                                      |  |      |            |   |      |   |            |      | 
|Non-controlling interest                              |  |      | (686,866   | ) |      |   | (419,359   | )    | 
|Net income for the year                               |  | $    | 13,106,503 |   |      | $ | 14,778,947 |      | 
|                                                      |  |      |            |   |      |   |            |      | 
|Net income per share                                  |  | $    | 318.76     |   |      | $ | 359.44     |      | 



The accompanying notes are an integral
part of the Consolidated Financial Statements



F-6







ECOPETROL S.A. and Subsidiaries

Consolidated Statements of Changes in Shareholders'
Equity

For the years ended December 31, 2013 and
2012

(Expressed in millons of Colombian pesos
except dividends per share)



|                                                                               |  | Subscribedand paid-incapital |            |  | Additionalpaid-incapital |   |           | Legal
    andother reserves |  |   | Incorporatedinstitutionalequity |   |  | Equitymethodsurplus |         |  | Valuationsurplus |   |           | PublicAccountingRegime effect |  |   | AccumulatedRetainedearnings |  |  | TotalShareholders'equity |         
|------------------------------------------------------------------------------ |  | ---------------------------- | ---------- |  | ------------------------ | - | --------- | --------------------------- |  | - | ------------------------------- | - |  | ------------------- | ------- |  | ---------------- | - | --------- | ----------------------------- |  | - | --------------------------- |  |  | ------------------------ | --------
|Balance as of December
    31, 2011                                            |  | $                            | 10,279,175 |  |                          | $ | 6,788,144 |                             |  | $ | 9,179,412                       |   |  | $                   | 174,080 |  |                  | $ | 1,166,810 |                               |  | $ | 12,671,696                  |  |  | $                        | (696,361
|Distribution of dividends ($300 per share)                                     |  |                              | -          |  |                          |   | -         |                             |  |   | -                               |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Additional paid-in capital                                                     |  |                              |            |  |                          |   | 10,390    |                             |  |   | -                               |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Additional paid-in capital receivable                                          |  |                              | -          |  |                          |   | 155,713   |                             |  |   | -                               |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Valuation surplus                                                              |  |                              | -          |  |                          |   | -         |                             |  |   | -                               |   |  |                     | -       |  |                  |   | -         |                               |  |   | 7,103,965                   |  |  |                          | -       
|Property, plant and equipment revaluation                                      |  |                              | -          |  |                          |   | -         |                             |  |   | -                               |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | 680,129 
|Legal reserve appropriation                                                    |  |                              | -          |  |                          |   | -         |                             |  |   | 187,958                         |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Regulatory Decree 2336/95 reserve appropriation                                |  |                              | -          |  |                          |   | -         |                             |  |   | 1,829,362                       |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Corporate Group unrealized reserve appropriation                               |  |                              | -          |  |                          |   | -         |                             |  |   | 2,123,538                       |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Transportation infrastructure integrity reserve                                |  |                              | -          |  |                          |   | -         |                             |  |   | 605,135                         |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Release of the Corporate Group's reserves for unrealized
    gains             |  |                              | -          |  |                          |   | -         |                             |  |   | (1,086,070                      | ) |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Dividend payment (shares issued in 2011) reserve
    appropriation             |  |                              |            |  |                          |   |           |                             |  |   | (449,904                        | ) |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          |         
|Release of the Regulatory Decree 2336/95 reserves
    for the previous year    |  |                              | -          |  |                          |   | -         |                             |  |   | (96,695                         | ) |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Equity method capital surplus and exchange rate
    adjustment                 |  |                              | -          |  |                          |   | -         |                             |  |   | -                               |   |  |                     | -       |  |                  |   | (342,109  | )                             |  |   | -                           |  |  |                          | -       
|Net income for the year                                                        |  |                              | -          |  |                          |   | -         |                             |  |   | -                               |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Balance as of December 31, 2012                                                |  | $                            | 10,279,175 |  |                          | $ | 6,954,247 |                             |  | $ | 12,292,736                      |   |  | $                   | 174,080 |  |                  | $ | 824,701   |                               |  | $ | 19,775,661                  |  |  | $                        | (16,232 
|Distribution of dividends ($291 per share)                                     |  |                              | -          |  |                          |   | -         |                             |  |   | -                               |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Additional paid-in capital receivable                                          |  |                              | -          |  |                          |   | 45        |                             |  |   | -                               |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Additional paid-in capital - called in guarantees                              |  |                              | -          |  |                          |   | 82        |                             |  |   | -                               |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Valuation surplus                                                              |  |                              | -          |  |                          |   |           |                             |  |   |                                 |   |  |                     |         |  |                  |   |           |                               |  |   | 4,830,558                   |  |  |                          | -       
|Property, plant and equipment revaluation                                      |  |                              | -          |  |                          |   | -         |                             |  |   | -                               |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | 1,363   
|Regulatory Decree 2336/95 reserve appropriation                                |  |                              | -          |  |                          |   | -         |                             |  |   | 215,407                         |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Release of the Regulatory Decree 2336/95 reserves
    for the previous year    |  |                              | -          |  |                          |   | -         |                             |  |   | (1,829,362                      | ) |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Corporate Group unrealized reserve appropriation                               |  |                              | -          |  |                          |   | -         |                             |  |   | 3,461,741                       |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Appropriation of reserves for new explorations                                 |  |                              | -          |  |                          |   | -         |                             |  |   | 2,595,112                       |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Appropriation of reserves for investment projects                              |  |                              | -          |  |                          |   | -         |                             |  |   | 2,628,877                       |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Appropriation of reserves for drilling infill campaign                         |  |                              | -          |  |                          |   | -         |                             |  |   | 1,260,000                       |   |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Release of the Corporate Group's reserves for unrealized
    gains prior years |  |                              | -          |  |                          |   | -         |                             |  |   | (2,595,112                      | ) |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Release transportation infrastructure integrity
    reserve                    |  |                              | -          |  |                          |   | -         |                             |  |   | (605,135                        | ) |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Release of the Corporate Group's unrealized reserves                           |  |                              | -          |  |                          |   | -         |                             |  |   | (2,123,538                      | ) |  |                     | -       |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Equity method capital surplus and exchange rate
    adjustment                 |  |                              | -          |  |                          |   | -         |                             |  |   | -                               |   |  |                     | -       |  |                  |   | 404,504   |                               |  |   | -                           |  |  |                          | -       
|Adjustment incorporated institutional equity                                   |  |                              | -          |  |                          |   | -         |                             |  |   | -                               |   |  |                     | 227     |  |                  |   | -         |                               |  |   | -                           |  |  |                          | -       
|Net income for the year                                                        |  |                              |            |  |                          |   |           |                             |  |   |                                 |   |  |                     |         |  |                  |   |           |                               |  |   |                             |  |  |                          |         
|Balance
    as of December 31, 2013                                            |  | $                            | 10,279,175 |  |                          | $ | 6,954,374 |                             |  | $ | 15,300,726                      |   |  | $                   | 174,307 |  |                  | $ | 1,229,205 |                               |  | $ | 24,606,219                  |  |  | $                        | (14,869 



The accompanying notes are an integral
part of the Consolidated Financial Statements



F-7







ECOPETROL S.A. and Subsidiaries

Consolidated Statement of Cash
Flows

For the years ended December
31, 2013, 2012 and 2011

(Expressed in millons of Colombian
pesos)



|                                                                                  |  | 2013 |             |   | 2012 |   |             | 2011 | 
|--------------------------------------------------------------------------------- |  | ---- | ----------- | - | ---- | - | ----------- | ---- | 
|Cash flows from operating activities:                                             |  |      |             |   |      |   |             |      | 
|Net income for the year                                                           |  | $    | 13,106,503  |   |      | $ | 14,778,947  |      | 
|Adjustments to reconcile net income to net cash provided by operating activities: |  |      |             |   |      |   |             |      | 
|Non-controlling interest                                                          |  |      | 686,866     |   |      |   | 419,359     |      | 
|Deferred Income tax and CREE, net                                                 |  |      | (202,733    | ) |      |   | 37,521      |      | 
|Property, plant and equipment depreciation                                        |  |      | 1,982,706   |   |      |   | 2,027,658   |      | 
|Exchange rate difference                                                          |  |      | (17,972     | ) |      |   | 309,130     |      | 
|Amortizations:                                                                    |  |      |             |   |      |   |             |      | 
|Natural resources                                                                 |  |      | 2,865,778   |   |      |   | 2,682,955   |      | 
|Facility abandonment                                                              |  |      | 220,238     |   |      |   | 312,252     |      | 
|Intangibles                                                                       |  |      | 344,868     |   |      |   | 291,884     |      | 
|Deferred charges                                                                  |  |      | 104,499     |   |      |   | 154,101     |      | 
|Allowances:                                                                       |  |      |             |   |      |   |             |      | 
|Accounts receivable                                                               |  |      | 31,681      |   |      |   | 87,187      |      | 
|Inventory                                                                         |  |      | 18,703      |   |      |   | 14,459      |      | 
|Property, plant and equipment                                                     |  |      | 122,514     |   |      |   | 315,627     |      | 
|Legal disputes and proceedings                                                    |  |      | 113,194     |   |      |   | 593,028     |      | 
|Pension liabilities for health and education                                      |  |      | 226,244     |   |      |   | 869,491     |      | 
|Pension transfer                                                                  |  |      | 804,358     |   |      |   | -           |      | 
|Investments                                                                       |  |      | 27,873      |   |      |   | 23,087      |      | 
|Recovery of allowances:                                                           |  |      |             |   |      |   |             |      | 
|Accounts receivable                                                               |  |      | (2,717      | ) |      |   | (225        | )    | 
|Inventories                                                                       |  |      | (5,254      | ) |      |   | (11,966     | )    | 
|Property, plant and equipment                                                     |  |      | (67,999     | ) |      |   | (159,833    | )    | 
|Investments                                                                       |  |      | (1          | ) |      |   | -           |      | 
|Legal disputes and proceedings                                                    |  |      | (307,493    | ) |      |   | (258,784    | )    | 
|Other                                                                             |  |      | (74,823     | ) |      |   | (283,283    | )    | 
|Property, plant and equipment write-off loss                                      |  |      | 27,233      |   |      |   | 127         |      | 
|Recovery of property, plant and equipment (excess)                                |  |      | (152,964    | ) |      |   | -           |      | 
|Goodwill impairment                                                               |  |      | 353,012     |   |      |   | -           |      | 
|Natural and environmental resource write-off loss                                 |  |      | 843,228     |   |      |   | 34,191      |      | 
|Other asset write-off loss                                                        |  |      | -           |   |      |   | -           |      | 
|Loss in investments valuation                                                     |  |      | 4,728       |   |      |   | 65,096      |      | 
|(Profit) equity method                                                            |  |      | (120,060    | ) |      |   | (125,277    | )    | 
|Net changes in operating asset and liabilities:                                   |  |      |             |   |      |   |             |      | 
|Accounts and notes receivables                                                    |  |      | (6,090,115  | ) |      |   | (2,522,804  | )    | 
|Inventories                                                                       |  |      | (465,611    | ) |      |   | (390,847    | )    | 
|Deferred charges and other assets                                                 |  |      | 118,186     |   |      |   | 895,618     |      | 
|Accounts payable and related parties                                              |  |      | 676,518     |   |      |   | 2,601,167   |      | 
|Tax contributions and duties payable                                              |  |      | 2,300,118   |   |      |   | (730,923    | )    | 
|Labor and pension liabilities                                                     |  |      | (790,808    | ) |      |   | 34,632      |      | 
|Estimated liabilities and provisions                                              |  |      | 1,085,193   |   |      |   | 116,552     |      | 
|Other long-term liabilities                                                       |  |      | (242,930    | ) |      |   | (998,029    | )    | 
|Net cash provided by operating activities                                         |  | $    | 17,522,761  |   |      | $ | 21,182,098  |      | 
|Cash flows from investing activities:                                             |  |      |             |   |      |   |             |      | 
|Payment and advances for the acquisition of companies, net of acquired cash       |  |      | -           |   |      |   | -           |      | 
|Increase in investments                                                           |  |      | (7,567,590  | ) |      |   | (14,911,124 | )    | 
|Redemption and sale of investments                                                |  |      | 11,933,852  |   |      |   | 13,772,436  |      | 
|Dividends received                                                                |  |      | 98,281      |   |      |   | 70,690      |      | 
|Investment in natural and environmental resources                                 |  |      | (6,267,691  | ) |      |   | (5,615,306  | )    | 
|Additions to property, plant and equipment                                        |  |      | (7,957,123  | ) |      |   | (9,852,556  | )    | 
|Proceeds from sales of natural resources                                          |  |      | 100,790     |   |      |   | -           |      | 
|Proceeds from sales of property, plant and equipment                              |  |      | (2,963      | ) |      |   | -           |      | 
|Net cash used in investing activities                                             |  | $    | (9,662,444  | ) |      | $ | (16,535,860 | )    | 
|Cash flows from financing activities:                                             |  |      |             |   |      |   |             |      | 
|Non-controlling interests                                                         |  |      | -           |   |      |   | (69,823     | )    | 
|Increase financial obligations                                                    |  |      | 7,492,632   |   |      |   | 5,110,249   |      | 
|Capitalizations                                                                   |  |      | 82          |   |      |   | 10,390      |      | 
|Dividends paid                                                                    |  |      | (14,570,467 | ) |      |   | (8,419,332  | )    | 
|Net cash used in financing activities                                             |  | $    | (7,077,753  | ) |      | $ | (3,368,516  | )    | 
|                                                                                  |  |      |             |   |      |   |             |      | 
|Net increase (decrease) in cash and cash equivalents                              |  |      | 782,564     |   |      |   | 1,277,722   |      | 
|Exchange rate difference in cash and cash equivalents                             |  |      | 118,184     |   |      |   | (116,969    | )    | 
|Cash and cash equivalents at the beginning of the year                            |  |      | 7,940,690   |   |      |   | 6,779,937   |      | 
|Cash and cash equivalents at
    the end of the year                              |  | $    | 8,841,438   |   |      | $ | 7,940,690   |      | 



The accompanying notes are an integral
part of the Consolidated Financial Statements



F-8







Ecopetrol S.A. and Subsidiaries

For the years ended December 31, 2013,
2012 and 2011

(Amounts are expressed in millions
of Colombian pesos, except amounts stated in other currencies; exchange rates and income per share, which are expressed in Colombian
pesos – throughout these financial statements pesos or $ refer to Colombian pesos and U.S. dollar refers to United States
dollars)



| | (1) | Economic Entity and
                                         Principal Accounting Policies and Practices
| | --- | --------------------------------------------------------------------------------------------------------



Reporting
Entity



Ecopetrol S.A. (hereinafter
Ecopetrol or the Company) was constituted by Act 165 of 1948 and transformed through Extraordinary Decree 1760 of 2003 (as well
as Decree 409 of 2006) and Act 1118 of 2006 into a state-owned stock company and then into a mixed economy company of a commercial
nature, at the national level, linked to the Ministry of Mines and Energy, with an indefinite life term. Ecopetrol’s corporate
purpose is the development, in Colombia or abroad, of commercial or industrial activities arising from or related to the exploration,
production, refining, transportation, storage, distribution, and selling of hydrocarbons, their by-products and associated products,
as well as subsidiary operations, connected or complementary to these activities, in accordance with applicable regulations. Ecopetrol’s
main domicile is Bogotá, Colombia, and it may establish subsidiaries, branches and agencies in Colombia or abroad.



Pursuant to Transformation
Decree 1760 of 2003, all administration of the Colombian nation’s hydrocarbon reserves, as well as the administration of
non-strategic assets represented by stocks and shares in companies, were separated from Ecopetrol. Furthermore, Ecopetrol’s
basic structure was changed and two entities were created: a) the Agencia Nacional de Hidrocarburos (National Hydrocarbons
Agency, hereinafter ANH) was created to issue and develop Colombian oil policy from that point forward (formerly the responsibility
of Ecopetrol), and b) Sociedad Promotora de Energía de Colombia S.A., which received the non-strategic assets owned
by Ecopetrol.



Act 1118 of December 27, 2006
changed the legal nature of Ecopetrol and authorized the Company to issue shares to be placed on the public market and acquired
by Colombian individuals or legal entities. Once the shares corresponding to 10.1% of the authorized capital were issued and placed,
at the end of 2007, the Company became a public-private entity of a commercial nature, at the national level, related to the Ministry
of Mines and Energy.



Ecopetrol entered into a deposit
agreement with JP Morgan Chase Bank, N.A., as depositary, for the issuance of ADSs evidenced by ADRs. Each of the ADSs represents
20 of Ecopetrol’s common shares or the right to receive 20 common shares of Ecopetrol.



On September 12, 2008, Ecopetrol
submitted an application to the U.S. Securities and Exchange Commission (SEC) to register and list the Company’s ADSs evidenced
by ADRs on the New York Stock Exchange (NYSE). The Company’s ADSs began trading on the NYSE under the “EC” symbol
on September 18, 2008.



On December 3, 2009, the National
Oversight Commission for Entities and Securities of Peru (from the Spanish Comisión Nacional Supervisora de Empresas
y Valores del Perú- CONASEV) approved the listing of Ecopetrol’s ADRs on the Lima Stock Exchange and the registration
of such securities with the Public Registry of the Securities Market. The ADRs began trading on the Lima Stock Exchange on December
4, 2009 in the Peruvian market under the “EC” symbol.



On August 13, 2010, Ecopetrol
began trading its ADRs on the Toronto Stock Exchange, Canada. Thus, Ecopetrol became the first Colombian company to be listed
on the Toronto Stock Exchange.



Between July 27 and August
17, 2011, Ecopetrol carried out the second placement of its public offering, authorized by Act 1118 of 2006. As a result of this
process, 644,185,868 common shares were issued at a nominal price of $3,700 per share, for a total amount of $2,383,488. The common
shares were registered with the National Registry of Securities and Issuers in accordance with Decree 2555 of 2010. Following
this, the Colombian National Government’s equity participation in Ecopetrol was 88.49%.



F-9







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The companies consolidated
by Ecopetrol S.A. are:



|Subsidiary                                      |  | Ecopetrolparticipationpercentages |       |   | Activity |                                                                                                  | Subsidiaries |                                                                                                               | Date
    ofincorporation |  |            | Country/Domicile |  | Geographicarea ofoperations
|----------------------------------------------- |  | --------------------------------- | ----- | - | -------- | ------------------------------------------------------------------------------------------------ | ------------ | ------------------------------------------------------------------------------------------------------------- | ------------------------ |  | ---------- | ---------------- |  | ---------------------------
|Ecopetrol Oleo é Gas do Brasil
    Ltda.        |  |                                   | 100   | % |          | Hydrocarbon exploration and exploitation.                                                        |              | -                                                                                                             |                          |  | 12/14/2006 |                  |  |                            
|Ecopetrol del Perú S.A.                         |  |                                   | 100   | % |          | Hydrocarbon exploration and exploitation.                                                        |              | -                                                                                                             |                          |  | 08/27/2007 |                  |  |                            
|Ecopetrol America Inc.                          |  |                                   | 100   | % |          | Hydrocarbon exploration and exploitation.                                                        |              | -                                                                                                             |                          |  | 10/09/2007 |                  |  |                            
|Black Gold Re Ltd.                              |  |                                   | 100   | % |          | Reinsurer of Ecopetrol and its subsidiaries.                                                     |              | -                                                                                                             |                          |  | 08/24/2006 |                  |  |                            
|Andean Chemicals Ltd.                           |  |                                   | 100   | % |          | Investment vehicle                                                                               |              | Bioenergy
                                         S.A., Refinería de Cartagena, Propileno del Caribe y Comai |                          |  | 01/30/1997 |                  |  |                            
|ODL Finance S.A.                                |  |                                   | 65    | % |          | Pipeline transportation of crude oil.                                                            |              | ODL
                                         S.A.                                                             |                          |  | 07/15/2008 |                  |  |                            
|Propileno del Caribe. Propilco S.A.             |  |                                   | 100   | % |          | Production and marketing of polypropylene resin.                                                 |              | Comai
                                         S.A., Refineria de Cartagena                                   |                          |  | 03/16/1989 |                  |  |                            
|Bioenergy S.A.                                  |  |                                   | 91.43 | % |          | Biofuel production.                                                                              |              | Bioenergy Zona Franca S.A.                                                                                    |                          |  | 12/13/2005 |                  |  |                            
|Ecopetrol Global Energy                         |  |                                   | 100   | % |          | Investment Vehicle                                                                               |              | Ecopetrol America Inc., Ecopetrol oleo & Gas do Brasil Ltda, Ecopetrol del Perú S.A.                          |                          |  | 03/26/2009 |                  |  |                            
|Ecopetrol Pipelines International Limited       |  |                                   | 100   | % |          | Investment Vehicle                                                                               |              | Oleoducto Bicentenario y Ocensa                                                                               |                          |  | 05/21/1991 |                  |  |                            
|Oleoducto Central S.A. - Ocensa                 |  |                                   | 72.65 | % |          | Pipeline transportation of crude oil.                                                            |              | -                                                                                                             |                          |  | 12/14/1994 |                  |  |                            
|COMAI - Compounding and Masterbatching Industry |  |                                   | 100   | % |          | Manufacturing of polypropylene compounds and
    master batches for a wide range of uses.        |              | Refinería de Cartagena                                                                                        |                          |  | 05/21/1991 |                  |  |                            
|Refineria de Cartagena S.A.                     |  |                                   | 100   | % |          | Hydrocarbon refining, marketing and distribution.                                                |              | -                                                                                                             |                          |  | 10/11/2006 |                  |  |                            
|Hocol Petroleum Limited                         |  |                                   | 100   | % |          | Investment Vehicle.                                                                              |              | Hocol S.A.                                                                                                    |                          |  | 09/29/1995 |                  |  |                            
|Oleoducto de Colombia S.A. - ODC                |  |                                   | 73    | % |          | Pipeline transportation of crude oil.                                                            |              |                                                                                                               |                          |  | 07/10/1989 |                  |  |                            
|Oleoducto Bicentenario de Colombia S.A.S.       |  |                                   | 55.97 | % |          | Pipeline transportation of crude oil                                                             |              | -                                                                                                             |                          |  | 08/18/2010 |                  |  |                            
|Ecopetrol Capital AG                            |  |                                   | 100   | % |          | Financing, liquidation of funding for companies,
    groups or any business or related activity. |              | -                                                                                                             |                          |  | 12/07/2010 |                  |  |                            
|Equion Energía Limited                          |  |                                   | 51    | % |          | Hydrocarbon exploration, exploitation and production.                                            |              | Santiago Oil Company, ODC                                                                                     |                          |  | 06/05/1959 |                  |  |                            
|Ecopetrol Global Capital SL                     |  |                                   | 100   | % |          | Investment Vehicle                                                                               |              | -                                                                                                             |                          |  | 01/10/2011 |                  |  |                            
|Cenit S.A.S.                                    |  |                                   | 100   | % |          | Storage and pipeline transportation of hydrocarbons                                              |              | Oleoducto Bicentenario, Ocensa, ODC, ODL                                                                      |                          |  | 06/15/2012 |                  |  |                            



F-10







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The Company and some of its
subsidiaries carry out exploration and production operations through Exploration and Production (E&P) Contracts and Technical
Evaluation Contracts and Agreements (TEA) signed with the ANH, as well as through Association Contracts and other types of contracts
in various forms. The following one the outstanding contracts at the close of December 2013:



|No. of Contracts                                  
|--------------------------------------------------
|Type of contract                                  
|Exploration                                       
|E&P-ANH Contracts                                 
|E&P-ANH Agreements                                
|TEA’s – ANH                                       
|Association Contracts                             
|Production                                        
|Partnership                                       
|E&P-ANH Contracts                                 
|Undeveloped and Inactive Discovered Fields (CDNDI)
|Incremental production                            
|Risk participation                                
|Technological partnership                         
|Business cooperation                              
|Shared risk participation                         
|Operation                                         
|Production services with risk                     
|                                                  



The following are the outstanding
contracts at the close of December 2012:



|No. of Contracts                                  
|--------------------------------------------------
|Type of contract                                  
|Exploration                                       
|E&P-ANH Contracts                                 
|E&P-ANH Agreements                                
|TEA’s – ANH                                       
|Association Contracts                             
|Production                                        
|Partnership                                       
|E&P-ANH Contracts                                 
|Undeveloped and Inactive Discovered Fields (CDNDI)
|Sole Risk                                         
|Incremental production                            
|Risk participation                                
|Technological partnership                         
|Business cooperation                              
|Services and technical cooperation                
|Shared risk participation                         
|Operation                                         
|Production services with risk                     
|                                                  



Principal Accounting
Policies and Practices



The Contaduría General
de la Nación(National Accounting Office, or CGN) adopted the Public Accounting Regime (RCP) in September 2007, defining
its configuration, scope and application. Pursuant to CGN Communication No. 20079-101345 of September 28, 2007, the Colombian
Government Entity Generally Accepted Accounting Principles (GAAP) went into effect for Ecopetrol on January 1, 2008.



F-11







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Consolidation Process



The consolidated financial
statements have been prepared in accordance with Articles 23 and 122 of Decree 2649 of 1993. The latter article stipulates that
an economic entity that owns more than 50% of the other economic entities must present, along with its basic financial statements,
the consolidated financial statements with their respective notes. The consolidation method used is the full consolidation method
set out in External Circular Letter No. 005 of April 6, 2000, issued by the Superintendence of Corporations, which stipulates
that consolidated financial statements must be aggregated based on the individual financial statements of the parent company and
of each of its subsidiaries, identifying the effect of all of the operations among the companies in the group.



The group consolidation was
carried out using the financial statements of the parent company and its subsidiaries, at the same cut-off point of December 31,
2013 and 2012, after they were standardized according to the Public Accounting Regime issued by theCGN.



| | (a) | Basis of Presentation
| | --- | ---------------------



The consolidated financial
statements were prepared in conformity with Colombian Government Entity GAAP standards and principles issued by the CGN, and other
legal provisions. These principles may differ in certain respects from those established by other standards and other control
authorities and CGN concepts on specific matters prevail over other regulations.



The accrual method was applied
for the accounting recognition of the consolidated statement of financial, economic, social and environmental activities.



A structure was established
in accordance with the rules for the inspection, supervision, and/or control of Ecopetrol and the companies that apply the Regime
of Public Accounting (RCP) to record operations at the level of source documents, or for standardization purposes, to define the
accounting treatment of operations not covered by the CGN. The structure involves: i) Principal and permanent inspection, supervision,
and control: Superintendence of Domiciliary Public Services; ii) residual control: Superintendence of Corporations; and iii) concurrent
control: Superintendence of Finance, of the activities of the Company in its capacity as issuer in the stock market. International
Financial Reporting Standards (IFRS) are applied to define regulatory differences, while accounting standards under Generally
Accepted Accounting Principles in the United States (USGAAP) are applied for accounting issues related to crude oil and natural
gas activities.



The basic consolidated financial
statements defined by the CGN, comprise the Balance Sheet, the Statement of Financial, Economic, Social and Environmental Activity,
the Statement of Changes in Equity and the Statement of Cash Flows. The notes to the basic consolidated financial statements are
an integral part thereof.



The consolidated financial
statements include the accounts of the businesses in which the Company holds a direct or indirect share of over 50% of capital,
or over which it has significant influence without being a majority shareholder. All inter-company transactions among consolidated
companies have been eliminated. The attached consolidated financial statements consolidate the assets, liabilities, equity and
results of the subsidiaries.



The accompanying financial
statements consolidate assets, liabilities, equity and results of the subsidiary companies. The investments recorded in these
companies are recognized by the equity method. The annual consolidated financial statements are submitted to the General Assembly
of Shareholders and are the basis for the distribution of dividends and other appropriations.



| | (b) | Materiality Criterion
| | --- | ---------------------



An economic fact is material
whenever, due to its nature, amount and surrounding circumstances, the knowledge or ignorance of it, may significantly alter the
economic decisions of users of such financial information.



As set forth by the RCP, the
information disclosed in the financial statements and financial accounting reports must cover the main aspects of the Government
Accounting entity in a way that must be significantly close to the truth, so that it is relevant and reliable for decision-making
purposes or the required evaluations based on accounting information objectives. Materiality depends on the nature of the facts
or the magnitude of the amounts disclosed or not revealed.



The consolidated financial
statements include specific headings in accordance with legal requirements or for elements representing 5% or more of total assets,
current assets, total liabilities, current liabilities, working capital, equity and income, as appropriate. In addition, lower
amounts are shown when they are deemed to contribute to a better interpretation of financial information.



F-12







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (c) | Use of Estimates
| | --- | ----------------



The preparation of consolidated
financial statements requires that the management of the companies in the Group make estimates and assumptions that could affect
the recorded amounts of assets, liabilities, results of activities and the attached notes. These estimates are carried out based
on technical criteria, judgment and tenets pursuant to the regulations and legal provisions in effect. Actual results may differ
from such estimates.



| | (d) | Foreign Currency Transactions
| | --- | -----------------------------



Foreign currency transactions
are recognized in accordance with applicable regulations and recorded at the appropriate exchange rates on the transaction date.
Balances denominated in foreign currency are expressed in Colombian pesos at representative market exchange rates at the end of
each period.



The exchange difference resulting
from asset adjustments is recorded in results; exchange differences from adjustments to liabilities are applied to the related
assets until they are ready for use or sale; the adjustment is subsequently charged to results of operations.



In accordance with Decree
4918 of December 26, 2007 issued by the Ministerio de Comercio, Industria y Turismo (Ministry of Trade, Industry and Tourism),
the exchange difference generated from variable income investments in subordinated companies abroad is recorded at the higher
or lower value of the shareholders' equity; when the investment is settled, this value is recorded in the results for the period.



While performing its oil industry
activities, the Company can freely deal in foreign currencies, provided that it complies with the provisions of the Colombian
exchange rate regime.



The conversion of financial
statements of subsidiaries that use currencies other than the Colombian peso involved changing the currency first to U.S. dollars
and then to Colombian pesos. The Representative Market Rate (RMR) at December 31, 2013, was used to convert asset and liability
balances, the representative monthly average market rate was used to convert result figures, and the historical rates were used
to convert capital figures.



| | (e) | Joint Venture Contracts
| | --- | -----------------------



Joint venture contracts are
entered into between Ecopetrol or the companies in the Group and third parties in order to share the risk, secure capital, maximize
operating efficiency and optimize the recovery of reserves. In these joint ventures, one party is designated as the operator and
each party takes its share of the hydrocarbons (crude oil or gas) produced according to its agreed participation. When Ecopetrol
or one of the companies in the Group participates as a non-operator partner, it records the assets, liabilities, revenues, costs
and expenses based on information reported by the operators. When Ecopetrol or one of the companies in the Group is the direct
operator of the joint venture contract, it records 100% of the assets, liabilities, revenues, costs and expenses, and recognizes
on a monthly basis the distribution according to the participation interests of each partner in the applicable line items corresponding
to: assets, liabilities, expenses, costs and revenues for the associate.



| | (f) | Cash and Cash Equivalents
| | --- | -------------------------



Cash and cash equivalents
are represented by negotiable investments with maturity dates within ninety (90) days following their acquisition, and are recorded
as liquidity management investments.

Cash from joint operations
in which the Company is the operating partner corresponds to advances from partners (including the companies in the group) according
to their contractually agreed participation percentages, and the funds are managed in a joint operation exclusive - use bank account.



| | (g) | Derivative Financial Instruments
| | --- | --------------------------------



Ecopetrol and the companies
in the Group enter into hedging agreements to hedge international fluctuations in crude-oil prices, product prices and exchange
rates. The difference between the contract value and market value, generated by hedging operations, is recognized as financial
income or expense in the statements of financial, economic, social and environmental activities. The Group does not use these
financial instruments for speculative purposes.



| | (h) | Investments
| | --- | -----------



The investments are classified
as: i) Liquidity Management Investments, ii) Investments for Policy Purposes and iii) Equity Investments.



| | i. | Liquidity management investments
                                         correspond to resources invested in debt and participative securities with the objective
                                         of obtaining profits through short-term price fluctuations. They are initially recorded
                                         at to their historical cost and they are subsequently recorded based on valuation methods
                                         issued by the Superintendence of Finance of Colombia.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-13







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | ii. | Investments for policy purposes
                                         are made up of national or foreign debt securities acquired in compliance with the macroeconomic
                                         or internal policies of the entity, which include investments held through their maturity
                                         date and those available for sale. The latter being those which are kept for at least
                                         one (1) year, as of the first day on which they were classified for the first time, or
                                         when they were reclassified.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Investments held to maturity
are updated based on the internal rate of return (IRR) as set out in the methodology adopted by the Superintendence of Finance,
and the investments for the purpose of macroeconomic policy and those available for sale must be updated based on the methodology
adopted by the Superintendence of Finance of Colombia for tradable investments.



| | iii. | Equity investments are classified
                                         as being in controlled and uncontrolled entities. Equity investments in controlled entities
                                         are recognized at their acquisition cost whenever it is lower than the intrinsic value;
                                         otherwise, they are recognized at the intrinsic value, and the difference between the
                                         purchase price and the intrinsic value corresponds to goodwill.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Investments in associates
in which Ecopetrol and/or its subsidiaries exert significant influence are recorded using the equity method.



Significant influence is defined
as the empowerment an entity has, whether or not the percentage of ownership is 50% or lower, to participate in setting and directing
the financial and operational policies of another entity for the purpose of obtaining profits from that entity.



Significant influence may
be present in one or more of the following ways:



| | • | Representation
                                         on the Board of Directors or equivalent governing body of the associate;
| | - | --------------------------------------------------------------------------------------------------------------------------------

| | • | Participation
                                         in policy-making;
| | - | ------------------------------------------------------------------------

| | • | Significant
                                         transactions between the investor and the associated entity;
| | - | -----------------------------------------------------------------------------------------------------------------

| | • | Secondment
                                         of officers; or
| | - | -------------------------------------------------------------------

| | • | Supplying
                                         essential technical information.
| | - | -----------------------------------------------------------------------------------



For subsidiaries
abroad, the equity method must apply in Colombian legal currency after the conversion of financial statements in foreign currency.



Equity investments in uncontrolled
entities include shares with a low or minimum market, or shares not listed on any stock exchange. They do not enable any type
of control or significant influence and are recognized at historical cost. Their change in value arises from periodically comparing
the cost of the investment to its intrinsic value or its value on the stock market.



The investments made in foreign
currency are recognized using the Representative Market Rate (“TRM”) at the time of the transaction. The value is
periodically adjusted based on the TRM as far as the actualization methodology has not considered it.



Equity variations originating
in the adjustment for conversion of the controlled entity are recognized as a surplus by the equity method, notwithstanding that
the subaccount may show a debit balance; the above is in compliance with Resolution 193 of July 27, 2010 issued by the National
Accounting Office.



| | (i) | Accounts and Notes Receivable
                                         and Allowance for Doubtful Accounts
| | --- | ----------------------------------------------------------------------------------------------------------



Accounts and notes receivable
are stated at their original amount or at the value accepted by the debtor, subject to periodic updating according to legal provisions
in force, or according to agreed-upon contract terms.



The allowance for doubtful
accounts is reviewed and updated periodically based on the age of the balances and the recovery analysis of individual accounts.
The Group carries out the necessary administrative and legal steps to recover overdue accounts receivable and to collect interest
from clients who do not comply with payment policies.



Accounts and notes receivable
are only written off against the allowance when there is reasonable legal or material certainty of the total or partial loss of
the incorporated or represented right.



| | (j) | Inventories
| | --- | -----------



Inventories include assets
extracted, in production process, transformed or acquired for any reason, for the purpose of being sold, transformed and consumed
in the production process, or as part of services delivered. The perpetual inventory system is used.



Inventories are stated at
historical cost or at purchase price, including direct and indirect charges incurred to prepare the inventory for sale or production.



F-14







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The value of inventories is
measured using the weighted average cost method, taking into account the following parameters:



| | · | Inventories
                                         of oil produced by the Company at average, production cost;
| | - | ----------------------------------------------------------------------------------------------------------------

| | · | Crude
                                         oil purchases, at acquisition costs, including transportation and delivery costs incurred;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------

| | · | Inventory
                                         of finished products, at total production costs;
| | - | ---------------------------------------------------------------------------------------------------

| | · | Inventory
                                         of products in progress, at production costs; and
| | - | ----------------------------------------------------------------------------------------------------

| | · | Inventory
                                         of raw materials, at weighted average cost.
| | - | ----------------------------------------------------------------------------------------------



Raw materials and supplies
in joint ventures are controlled by the operator and reported in a joint account at the acquisition cost (recorded in the original
currency at average costs). Inventory consumption is charged to the joint venture as cost, expense or investment, as appropriate.



Furthermore, inventories are
valued at the lower value of market cost or average cost, and in-transit inventories are appraised at cost incurred. At the end
of the fiscal year allowances are calculated to take into account impairment, obsolescence, excess, slow movement or loss of market
value.



| | (k) | Property, Plant and Equipment
                                         and Depreciation
| | --- | ---------------------------------------------------------------------------------------



Property, plant and equipment
are stated at inflation-adjusted historical cost until 2001. This cost includes financial expenses and the exchange rate difference
for foreign currency acquisition until commissioning of the asset, as well as financial revenues from the unused portion of financial
obligations acquired to finance investment projects. When an asset is sold or disposed of, the adjusted cost and accumulated depreciation
are written off and any gain or loss is recorded in the year’s results.



Depreciation is calculated
on the total acquisition cost using the straight-line method, based on the assets’ useful life which is reviewed periodically.
Annual depreciation rates are as follows:



|                         |  | % |     
|------------------------ |  | - | ----
|Buildings and pipelines  |  |   | 5.0 
|Plant and equipment      |  |   | 10.0
|Transportation equipment |  |   | 20.0
|Calculation equipment    |  |   | 33.3



Disbursements for maintenance
and repairs are recorded as expenses. Significant disbursements that improve efficiency of an asset or extend its useful life
are capitalized as an increase in the value of that asset.



The value of property, plant
and equipment is subject to periodic revaluation by comparing the net book value with the value determined through technical appraisals.
When the value of an asset’s technical appraisal is greater than its net book cost, the difference is recorded as an asset
valuation and credited to the surplus account for equity valuation; otherwise, it is recorded as an allowance for devaluations
and charged to income.



Upon termination of an association
contract, the Group receives, at no cost, the property, plant and equipment, materials and materials.These transactions do not affect the Group ́s results. The results of the appraisal of property, plant and equipment
are recognized as appraisals in the corresponding asset and equity accounts.



| | (l) | Natural and Environmental
                                         Resources
| | --- | ----------------------------------------------------------------------------



The Group follows the successful-efforts method of accounting for investments in exploration and production
or development. Geological and geophysical studies are recorded as expenses as they are incurred. Acquisition costs for proved
and unproved properties arecapitalized when incurred. Exploration costs
are capitalized until it is determined whether the exploration drilling was successful or not. If they are not successful, all
of the costs incurred are charged to expenses. When a project is approved for development, the accumulated value of the acquisition
and exploration costs are classified in the oil investment account. Capitalized costs also include asset retirement costs. Asset
and liability balances related to asset retirement costs are updated every year. Production and support equipment is accounted
for on a historical cost basis and is included in property, plant and equipment subject to depreciation.





Oil investments are amortized
by applying the amortization factor based on technical units of production and proven developed reserves net of royalties, based
on a field basis, estimated as of December 31 of the immediately preceding year. The amortization charged to income is adjusted
at the end of December, recalculating the DD&A (Depletion, Depreciation and Amortization) as of January 1 of the current year,
based on the reserve study updated at the end of the current year.



In the same way that it receives
property, plant and equipment upon termination of an association contract, Ecopetrol receives, at no cost, the associate’s
amortizable oil investments.



F-15







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Ecopetrol S.A. has established
a corporate process for reserves led by the Reserves Directorate, which reports directly to the Vice President of Corporate Finance.
The reserves are audited by internationally recognized external consultants and approved by the Company’s Reserves Committee.
Proven reserves consist of the estimated quantities of crude oil and natural gas demonstrated with reasonable certainty by geological
and engineering data to be recoverable in future years from known reserves under existing economic and operating conditions, that
is, at the prices and costs that apply at the date of the estimate.



Estimating hydrocarbon reserves
is subject to several uncertainties inherent in determining proven reserves, including the production recovery rates, the timeliness
in making the investments to develop oilfields and the degree of maturity of fields.



When it is determined that
a well located in the exploration zone does not have proven reserves, it is classified as dry or non-commercial, and the accumulated
costs of such well are taken to expenses in the same year in which this is determined.



Since Ecopetrol became an
issuer on the Colombian Stock Exchange (Bolsa de Valores de Colombia - BVC) and the New York Stock Exchange - NYSE, the
Company has applied the methodology approved by the SEC (Securities Exchange Commission) for estimating reserves.



Pursuant to the provisions
of Resolution 494 of December 22, 2009, issued by the ANH, Ecopetrol complies with the delivery of information to the ANH using
the methodology of (SPE-PRMS) Oil Resource Administration System. The reserves shown in the reports are audited by three independent
reservoir engineering firms.



| | (m) | Deferred Charges
| | --- | ----------------



Deferred charges include:
i) deferred income tax and deferred income tax for equality - CREE resulting from the temporary differences between the basis
for determining commercial gains and taxable net income at the end of each period. The deferred tax is amortized during the periods
in which the temporary differences that originated it are reversed and ii) the net equity tax, which is amortized until 2014.
iii) investments made to develop collaboration contracts that are amortized based on technical units of production.



| | (n) | Other Assets
| | --- | ------------



Other assets include goodwill,
which corresponds to the difference between the purchase value of equity investments in controlled or joint-control entities,
and their intrinsic value, which reflects the economic benefits expected to be achieved from the investment, created by brand
name, specialized personnel, preferential credit reputation, prestige due to sale of better products and services, favorable location
and the expectations of new business, among other things.



Goodwill is amortized using
the straight-line method over the term for expected recovery of the investment, which is from 10 to 18 years. At the close of
each accounting period, Ecopetrol must evaluate goodwill to determine whether the conditions for the generation of future economic
benefits still exist; otherwise, the asset must be written off. If the book value of equity investment plus the book value of
goodwill, which includes its historical cost and price adjustments and amortizations, is greater than the market value, the asset
should, as a result of such difference, be written off in the related period, and charged to income, and the reasons for the said
decision should be disclosed.



For local purposes, we perform the analysis of goodwill impairment conducting a fair value analysis using
a discounted cash flow methodology. We compare the fair value of the investment
with its carrying of the investment, including goodwill. If the carrying amount of investment is higher than its fair value, goodwill
is considered impaired. On the other hand, when the carrying amount of the investment is lower than its fair value, there is not
necessary to recognize an impairment.





Intangible assets such as:
software, licenses and patents are recognized at acquisition, development or production cost. Intangible assets are amortized
using the straight-line method over the periods during which the benefits arising from the incurred costs and expenses are expected
to occur, or during the term of the legal or contractual coverage of the granted rights.



Goods acquired through financial
leasing are subject to depreciation in order to recognize the loss of operational capacity by their utilization. In public accounting
entities of the general government, the depreciation of goods acquired through financial leasing affects directly the equity,
except for assets used in activities of production of goods and rendering of services readily individualized that must be recognized
as cost or expense.



Improvements and works performed
on leasehold property or third party property different from those that can be recognized as property, plant and equipment will
be amortized over the shortest period between the term of the contract covering the use of the property, and the estimated useful
life of the assets, as a result of the additions or improvements made, only when the cost of the works and improvements made is
not reimbursable. In the case of public accounting entities of the government, amortization affects equity, except for works and
improvements in Property used in activities for the production of goods and rendering of services, which must be recognized as
a cost.



F-16





Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (o) | Valuations
| | --- | ----------



| | a. | Investments
| | -- | -----------



Valuations correspond to differences
between the net book value of the investments and their intrinsic value or quoted price on the Stock Exchange.



| | b. | Property, plant and equipment
| | -- | -----------------------------



Valuations and the valuation
surplus of property, plant and equipment correspond to the difference between the net book value and the market value for real
estate or the Current Use Value (CUV) for plant and equipment, determined by specialists registered with the Colombian Real Estate
Association or by suitable technical personnel, as appropriate.



The methodology used for valuation
of plant and equipment is the Current Use Value (CUV), for running businesses, for the economic valuation of assets, taking into
account the facilities’ current conditions and their useful life in terms of production capability and ability to generate
income. It is not mandatory to adjust the value of moveable property when its historical value, taken individually, is lower than
35 current minimum monthly legal wages, or of property, plant and equipment located in high risk zones.



| | (p) | Financial Obligations
| | --- | ---------------------



Public credit operations correspond
to any action or contract which, in compliance with legal regulations on public credit, are addressed to supply the Company with
resources, goods and services under specific payment terms such as loans, issue and placement of bonds and public credit securities,
and supplier’s credit.



With respect to loans, public
credit operations must be recorded for the actual disbursed amount, while bonds and securities placed are recorded at their nominal
value. Placement costs are carried directly to expenses.



| | (q) | Income Tax
| | --- | ----------



The income tax provision as
of December 2013 was calculated by applying to the accounting profit before taxes, the effective taxation rate calculated for
December 2013. This rate includes both the income tax and the income tax for equality CREE.



The effect of temporary differences
that imply the payment of a lower or higher income tax in the current year, is accounted for as deferred tax asset or liability,
both for the income tax and for the income tax for equality CREE, as applicable, provided that there is a reasonable expectation
that such differences will be reversed in the case of the deferred tax asset, or sufficient taxable income is generated to recover
the tax in respect to the deferred tax liability. The deferred tax is calculated at the rate of 34% (25% ordinary income tax and
9% income tax for equality CREE) or of 33% (25% ordinary income tax and 8% income tax for equality CREE) as applicable.



| | (r) | Labor and Pension Obligations
| | --- | -----------------------------



Salaries and benefits for
Ecopetrol staff are governed by the Collective Labor Agreement 01 of 1977, and in their absence, by the Substantive Labor Code.
In addition to the legally mandated benefits, employees are entitled to fringe benefits which are subject to the place of work,
type of work, length of service, and basic salary. Annual interest of 12% is recognized on accumulated severance amounts for each
employee, and the payment of indemnities is provided for when special circumstances arise that result in the non-voluntary termination
of the contract, without just cause, and in periods other than the probationary period.



The actuarial calculation
includes active employees, as described in the paragraphs below, with indefinite term contracts, pensioners and heirs, for pension,
health care and education plans; similarly, it includes pension bonds for temporary employees, active employees and voluntary
retirements. Health care and education obligations do not comprise pension liabilities; they are part of benefit obligations.



All social benefits of employees
who joined the Company before 1990 are the responsibility of Ecopetrol, without the involvement of any social security entity
or institution. The cost of health services for the employee and his/her relatives registered with the Company is determined by
means of the mortality table, prepared based on facts occurring during the year. Similarly, Ecopetrol calculates educational allowances
according to experience, based on the annual average cost of each business, subdivided in accordance with the type of studies:
Pre-school, elementary, high school and university.



For employees who joined the
Company subsequent to the entry into effect of Act 50 of 1990, the Company makes periodic contributions for severance payments,
pensions and occupational injuries to the funds created for these respective obligations. Similarly, Act 797 of January 29, 2003
determined that Ecopetrol employees who joined the Company as of that date would be subject to the provisions of the General Pension
Regime.



F-17







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Pursuant to Legislative Act
01 of 2005, enacted by the Colombian Congress, the pension regimes excludes the General Social Security System in Colombia expired
on July 31, 2010. In accordance with the provisions therein, the Ministry of Social Protection’s judicial pronouncement
on the matter and the analysis conducted by Ecopetrol’s labor advisers, it was concluded that those workers who had met
the age and continuous or discontinuous service time requirements of the law, the Collective Bargaining Agreement in effect and/or
Agreement 01 of 1977, prior to August 1, 2010, had consolidated their right to their pension. It was, however, mandatory for other
workers, who were not covered, to join the General Pension System. The pension administrator chosen by the worker (either Colpensiones
or Private Pension Fund or whichever may correspond) would be responsible for recognizing and paying the respective pension.



As set out in Decree 941 of
2002, upon approval of the actuarial calculation by the Ministry of Finance in October 2008, and upon approval of the mechanism
by the Ministry of Social Protection through the Administration Act of December 29, 2008, the Company partially switched over
the value corresponding to monthly pension payments from its pension liabilities, transferring the said liabilities and their
underlying amounts to pension-related autonomous equities (PAP, per its acronym in Spanish). The funds transferred, and returns
on those funds, cannot be redirected nor can they be returned to the Company until all of the pension obligations have been fulfilled.



The transferred liability
corresponds only to pension allowances and pension bonds. The portion relating to health care and education services remains within
Ecopetrol’s labor liabilities.



At each period end, Ecopetrol
S.A. must review the amount reported by the PAP with respect to the value of the pension liability updated based on the latest
actuarial computation. In the event that the equity yields are insufficient to cover 100% of the liability, the Company must recognize
an allowance for the difference, which must be funded should the contingency materialize. Ecopetrol remains materially responsible
for payment of the pension liabilities.



Through Resolution 1555 of
July 30, 2010, the Superintendence of Finance replaced the mortality tables used to prepare actuarial computations and stipulated
that the effects of the change could be recognized gradually. Subsequently, Decree 4565 of December 7, 2010 modified the accounting
standards for amortization of the actuarial calculation in effect up to that date. Pursuant to the new decree, the companies that
had amortized 100% of their actuarial calculation at December 31, 2009 could gradually amortize the increase in the actuarial
calculation for 2010 using the new mortality tables, up to 2029.



Given the above, in 2010 Ecopetrol
modified its accounting policy for amortization of the actuarial calculation of monthly pension payments, pension quotas and bonds
(transferred liabilities) and health bonds, and adopted a five-year term starting in 2010, to amortize the increase in the 2010
actuarial computation. Until 2009, the yearly increase in the actuarial calculation was recorded as expenses for the period, given
that the actuarial calculation was 100% amortized.



Resolution 717 of December
2012 amended the Manual de Procedimiento del Régimen de Contabilidad Pública (Regime of Public Accounting
Procedure Manual) with regard to the Accounting Procedure for recognizing and disclosing the pension liability, the underlying
financial reserve, and related expenses, at items 5 and 44. With regard to item 5, the indications in the previous paragraph lead
to the conclusion that this item has no impact on the Company’s activities within its amortization plan.



With regard to item 44, its
only impact is to disclose the fact that the Reserve Funds are common funds that are also under the administration of Colpensiones.
There are no further implications for Ecopetrol.



| | (s) | Advances Received from Ecogas
                                         to cover BOMT (Build, Operate, Maintain and Transfer) Obligations.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------



Pursuant to the sale of Ecogas
by the National Government, and following specific instructions from CGN, the net present value of the future payment scheme in
connection with Ecopetrol’s debt toward BOMT contractors was recognized as deferred income. These liabilities are due in
2017, the year when the contract obligations will be fulfilled.



| | (t) | Hydrocarbon Purchases
| | --- | ---------------------



Ecopetrol purchases hydrocarbons
that the ANH receives from all production in Colombia, at prices established according to section four of Act 756 of 2002 and
Resolution 18-1709 of 2003 issued by the Ministry of Mines and Energy, taking into account international reference prices.



In addition, purchase of hydrocarbons
from partners and other producers in Colombia and abroad to meet the Group’s needs and operating plans.



F-18







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (u) | Revenue Recognition
| | --- | -------------------



Revenue from crude oil and
natural gas sales is recognized at the time of transfer of title to the buyer, including risks and rewards.



In the case of refined and
petrochemical products, revenue is recognized when products are shipped by the refinery and subsequently adjusted in accordance
with the volumes actually delivered.



Revenue from transportation
services is recognized when products are transported and delivered to the buyer in accordance with sale terms.



In other cases, revenue is
recognized at the time it is earned and a true, probable and quantifiable right to demand its payment arises.



Under current regulations,
Ecopetrol S.A. and Sociedad Refinería de Cartagena S.A. (Reficar) sell regular gasoline and diesel at a regulated price,
and the National Government recognizes for these businesses the amount of the subsidy on regular gasoline and diesel granted to
local consumers, which is generated by adding the difference, for every day of the month, between the producer's regulated revenues
and the daily price equivalent to the U.S. Gulf Coast reference price, calculated according to origin and multiplied by the volumes
sold daily.



Resolution 182439 and Decree
4839 of December 2008 established the procedure for recognizing subsidies in the event they are negative (negative value between
parity and regulated prices).



In March 2010, the Ministry
of Mines and Energy issued Resolution No. 180522, which revoked provisions that were contrary to Resolutions 181496 of September,
2008, 182439 of December 30, 2008 and 180219 of February 13, 2009 and modified the formula for computing the international reference
prices for gasoline and diesel.



Resolution 91658 was issued
in October 2012, which modifies Resolution 180522 with regard to the subsidy procedure for refiners and importers of regular gasoline
and diesel (ACPM).



| | (v) | Cost of Sales and Expenses
| | --- | --------------------------



Costs are recognized at their
historic value both for goods purchased for sale and for the accumulated production costs of goods produced and services rendered.
Costs are disclosed according to the operation generating them.



Expenses correspond to the
amounts required for the operation of ordinary activities and include those related to activities caused by extraordinary events.
Expenses are disclosed in accordance with their nature and the occurrence of extraordinary events.



Costs and expenses are recognized
upon receipt of goods or services or when there is certainty that the economic event will occur. Fuel shortages and losses due
to theft and explosions are recorded as non-operating expenses.



| | (w) | Abandonment of Fields
| | --- | ---------------------



The Group recognizes an estimated
liability for future environmental obligations, and its corresponding entry as a higher asset value for natural resources and
environmental assets. The estimate includes the cost of plugging and abandoning wells, dismantling facilities and the environmental
recovery of areas and wells. Amortization is recorded as production costs, using the technical-units-of-production method, based
on remaining proven developed reserves. Changes resulting from new estimates of the liability for abandonment and environmental
restoration are accounted for under the corresponding asset.



Depending on the scope of
certain association contracts, field abandonment costs are taken on by partners according to the same participation percentages
set out in each contract. Ecopetrol has not allocated funds to cover these obligations, with the exception of association contracts
Casanare, Orocue, Garcero, Estero, Corocora, Monas, Guajira, Tisquirama, Cravo Norte, and Opon; however, as activities linked
to field abandonment take place, they will be covered by the Group.



| | (x) | Accounting for Contingencies
| | --- | ----------------------------



On the date of issuance of
these consolidated financial statements, conditions might exist that could result in losses for the Company that will only be
known if specific future circumstances arise. The nature, and probability of such situations, as well as the amounts involved
are evaluated by Management, the Vice President of Legal Affairs, and legal consultants, so that decisions can be made regarding
changes to amounts provisioned and/or disclosed. This analysis includes current legal suits against the Companies of the Group.



The methodology used to assess
legal proceedings and any contingent obligations is based on the Nation’s credit system used by the Ministry of Internal
Affairs and Justice.



A provision is recorded for
legal proceedings when there is a conviction at trial court or when the risk assessment outcome is “likely to lose”.



F-19







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (y) | Memorandum Accounts
| | --- | -------------------



Creditor and debtor memorandum
accounts represent the estimated value of facts or circumstances that could affect Group ́s financial, economic, social and
environmental situation. They also disclose the value of the goods, rights and obligations that require control, and also include
differences between accounting information and the information used for tax purposes.



| | (z) | Net income per Share
| | --- | --------------------



Net income per share is calculated
based on net earnings for the period, divided by the subscribed outstanding shares.



The Company does not have
share-based employee incentive plans.



| | (aa) | Convergence to International
                                         Financial Reporting Standards
| | ---- | ---------------------------------------------------------------------------------------------------



On December 29, 2012 the Ministry
of Commerce, Industry and Tourism issued the Decree 2784, by which it was regulated the Act 1314 of 2009 on the technical framework
for preparers of financial information for group 1: Issuers of securities, public interest entities and entities that meet the
parameters set out in this provision.



This technical framework
was developed based on International Financial Reporting Standards—IFRS, International Accounting Standards - IAS,
SIC interpretations, IFRIC interpretations and conceptual framework for financial reporting, issued in Spanish on January 1,
2012, by the International Accounting Standards Board (IASB).



Pursuant to the schedule of
implementation, 2013 has been a period of preparation and training with the initial obligation to present an implementation plan
approved by the Board, including people responsible and targets for monitoring and control. 2014 will be the transition period
and 2015 will be period of full implementation of the new regulatory framework.



Pursuant to Decree 2784 of
2012, amended by Decree 3024 of 2013, it is required to prepare an opening statement of financial position as of January 1, 2014
under the new standards, so that during 2014 the transition takes place, with the simultaneous application of existing and new
accounting standards.



Resolution 743 of December
17, 2013 issued by the National Accounting Office (Contaduría General de la Nación - CGN) includes the schedule
of the regulatory framework attached to the National Decree 2784 of 2012 and defines the implementation period as being from January
1 to December 31, 2015. During this period, the accounting will be carried out, for all purposes under the new regulatory framework.



| | (2) | Assets and Liabilities
                                         Denominated in Foreign Currency
| | --- | -----------------------------------------------------------------------------------------------



Transactions and balances
in foreign currencies are converted at the market representative exchange rate certified by the Superintendence of Finance of
Colombia.



As of December 31, 2013 and
December 31, 2012, the consolidated financial statements of Ecopetrol included the following assets and liabilities denominated
in foreign currency (converted to Colombian pesos at the closing exchange rates of $1,926.83 and $1,768.23 per US$1, respectively).



|                                     |  | As of December 31, 2013 |            |  | As of December 31, 2012          |  
|------------------------------------ |  | ----------------------- | ---------- |  | -------------------------------- | -
|                                     |  | Thousands of us dollars |            |  | Equivalent millions
    of pesos |  
|Assets                               |  |                         |            |  |                                  |  
|Cash and cash equivalents            |  | $                       | 1,814,012  |  |                                  | $
|Investments                          |  |                         | 8,509,347  |  |                                  |  
|Accounts and notes receivable        |  |                         | 2,222,269  |  |                                  |  
|Advances and deposits                |  |                         | 143,544    |  |                                  |  
|Other assets                         |  |                         | 470,659    |  |                                  |  
|                                     |  | $                       | 13,159,831 |  |                                  | $
|Liabilities                          |  |                         |            |  |                                  |  
|Financial obligations                |  | $                       | 4,612,323  |  |                                  |  
|Estimated liabilities and allowances |  |                         | 206,443    |  |                                  |  
|Accounts payable and related parties |  |                         | 1,546,046  |  |                                  |  
|Other liabilities                    |  |                         | 247,447    |  |                                  |  
|                                     |  | $                       | 6,612,259  |  |                                  | $
|Net asset position                   |  | $                       | 6,547,572  |  |                                  | $



F-20







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (3) | Cash and Cash Equivalents
| | --- | -------------------------



The balance of cash and cash
equivalents is comprised as follows:



|                           |  | As of December 31,
    2013 |           |  | As of December 31,
    2012 |  
|-------------------------- |  | --------------------------- | --------- |  | --------------------------- | -
|Banks and corporations (1) |  | $                           | 6,440,081 |  |                             | $
|Special funds (2)          |  |                             | 1,494,760 |  |                             |  
|Cash                       |  |                             | 491       |  |                             |  
|Investments on demand (3)  |  |                             | 906,106   |  |                             |  
|                           |  | $                           | 8,841,438 |  |                             | $



| | (1) | Corresponds to advances made
                                         by partners for the exclusive use of the joint venture, in the amount of $95,916 (2012
                                         - $75,207) and Group ́s own resources in the amount of $6,344,165 (2012 - $6,044,199).
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | Corresponds to savings in special
                                         funds in pesos in the amount of $73,741 (2012 - $556,756) and in foreign currency in
                                         the amount of $960,575 (2012 - $708,007) as well as investments in overnight operations
                                         in the amount of $4,942 in 2012 and other investments in the amount of $460,444 for 2013.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | Represents investments on demand,
                                         fixed - term deposit certificates and overnight deposits, comprised mainly of the following:
                                         $267,202 (2012 - $108,374) from Ocensa S.A.; $351,855 (2012 - $12,838) from Reficar;
                                         $90,453 (2012 - $40,768) from Hocol; $142,674 (2012 - $74,345) from Ecopetrol Óleo
                                         e Gas Do Brasil; $13,200 (2012 - $12,504) from Equión and $40,723 from ODC.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (4) | Investments
| | --- | -----------



The balance of investments
is comprised as follows:



|                                                    |  | As of December 31,
    2013 |           |  | As of December 31,
    2012 |  
|--------------------------------------------------- |  | --------------------------- | --------- |  | --------------------------- | -
|Current:                                            |  |                             |           |  |                             |  
|Fixed yield                                         |  |                             |           |  |                             |  
|Term deposits                                       |  | $                           | 954,704   |  |                             | $
|Bonds and securities of private or foreign entities |  |                             | 260,990   |  |                             |  
|Bonds issued by the Colombian Government            |  |                             | 153,343   |  |                             |  
|Specific purpose fund - legal Contingencies (1)     |  |                             | 110,427   |  |                             |  
|Treasury securities – TES                           |  |                             | -         |  |                             |  
|Financial hedging instruments                       |  |                             | 179,725   |  |                             |  
|Trust rights                                        |  |                             | 119       |  |                             |  
|Total current investments                           |  | $                           | 1,659,308 |  |                             | $
|Long-term:                                          |  |                             |           |  |                             |  
|Variable yield - Shares (2)                         |  |                             | 1,219,744 |  |                             |  
|Fixed yield                                         |  |                             |           |  |                             |  
|Bonds and securities of foreign entities            |  |                             | 13,981    |  |                             |  
|Bonds issued by the Colombian Government            |  |                             | 86,616    |  |                             |  
|Treasury securities – TES                           |  |                             | -         |  |                             |  
|Specific purpose fund - legal Contingencies
    (1) |  |                             | 260,960   |  |                             |  
|Other Investments                                   |  |                             | 6,297     |  |                             |  
|Total long-term investments                         |  | $                           | 1,587,598 |  |                             | $



| | (1) | Corresponds to restricted resources
                                         made up of fixed-yield investments entered into based on the court rulings linked to
                                         the Derecho Comuneros - Santiago de las Atalayas and Pueblo Viejo de Cusiana proceedings,
                                         corresponding to the attachment and seizure of the royalty payments that Ecopetrol was
                                         to have paid pursuant to Royalty Contracts No. 15, 15A, 16 and 16A, declared null by
                                         statute in the State Council ruling of September 13, 1999.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-21







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (2) | The following is the detail
                                         of variable-yield investments represented in shares as of December 31:
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------



|                      |  | 2013 |           |  | 2012 |  
|--------------------- |  | ---- | --------- |  | ---- | -
|Companies:            |  |      |           |  |      |  
|Significant Influence |  | $    | 982,847   |  |      | $
|Non-strategic         |  |      | 236,897   |  |      |  
|Total                 |  | $    | 1,219,744 |  |      | $



Summary of long-term variable
yield-investments as of December 31, 2013, recognized using the equity method:



|Equity Share                 |  | Number of Shares
    and/or Quotas |                |  | Participation Percentage |  |       | Valuation Date |  | Historical Cost |  |   | Book Value |  |  | Equity Method
    Effect |        
|---------------------------- |  | ---------------------------------- | -------------- |  | ------------------------ |  | ----- | -------------- |  | --------------- |  | - | ---------- |  |  | ------------------------ | -------
|Significant influence        |  |                                    |                |  |                          |  |       |                |  |                 |  |   |            |  |  |                          |        
|Ecodiesel Colombia S.A.      |  |                                    | 10,500,000,000 |  |                          |  | 50.00 | %              |  | December        |  | $ | 10,500     |  |  | $                        | 26,677 
|Invercolsa S.A.              |  |                                    | 1,213,801,146  |  |                          |  | 43.35 | %              |  | December        |  |   | 61,671     |  |  |                          | 269,342
|Offshore International Group |  |                                    | 250            |  |                          |  | 50.00 | %              |  | December        |  |   | 408,517    |  |  |                          | 637,778
|Serviport S.A.               |  |                                    | 58,800,000     |  |                          |  | 49.00 | %              |  | December        |  |   | 2,081      |  |  |                          | 7,319  
|Transgas de Occidente S.A.   |  |                                    | 27,372,771     |  |                          |  | 20.00 | %              |  | October         |  |   | 4,051      |  |  |                          | 41,731 
|Total                        |  |                                    |                |  |                          |  |       |                |  |                 |  | $ | 486,820    |  |  | $                        | 982,847



Summary of long-term variable
yield-investment as of December 31, 2012, recognized using the equity method:



|Equity Share                 |  | Number of Shares
    and/or Quotas |                |  | Participation Percentage |  |       | Valuation Date |  | Historical Cost |  |   | Book Value |  |  | Equity Method
    Effect |        
|---------------------------- |  | ---------------------------------- | -------------- |  | ------------------------ |  | ----- | -------------- |  | --------------- |  | - | ---------- |  |  | ------------------------ | -------
|Significant influence        |  |                                    |                |  |                          |  |       |                |  |                 |  |   |            |  |  |                          |        
|Ecodiesel Colombia S.A.      |  |                                    | 10,500,000,000 |  |                          |  | 50.00 | %              |  | December        |  | $ | 10,500     |  |  | $                        | 19,408 
|Invercolsa S.A.              |  |                                    | 1,213,801,146  |  |                          |  | 43.35 | %              |  | October         |  |   | 61,671     |  |  |                          | 240,555
|Offshore International Group |  |                                    | 250            |  |                          |  | 50.00 | %              |  | December        |  |   | 408,517    |  |  |                          | 532,269
|Serviport S.A.               |  |                                    | 58,800,000     |  |                          |  | 49.00 | %              |  | December        |  |   | 2,081      |  |  |                          | 7,193  
|Transgas de Occidente S.A.   |  |                                    | 27,372,771     |  |                          |  | 20.00 | %              |  | November        |  |   | 4,051      |  |  |                          | 41,267 
|Total                        |  |                                    |                |  |                          |  |       |                |  |                 |  | $ | 486,820    |  |  | $                        | 840,692



Summary of long-term variable
yield-investments as of December 31, 2013, recognized using the cost method:



|Equity Share                                 |  | Number of Shares
    and/or Quotas |             |  | Participation Percentage |  |        | Valuation Date |  | Cost     |  |   | Market/ Intrinsic
    Value |  |  | Appreciation/ (Depreciation) |          
|-------------------------------------------- |  | ---------------------------------- | ----------- |  | ------------------------ |  | ------ | -------------- |  | -------- |  | - | --------------------------- |  |  | ---------------------------- | ---------
|Strategic                                    |  |                                    |             |  |                          |  |        |                |  |          |  |   |                             |  |  |                              |          
|Zona Franca de Cartagena S.A.                |  |                                    | 290         |  |                          |  | 10.00  | %              |  | November |  | $ | 394                         |  |  | $                            | 1,478    
|Sociedad Portuaria del Dique                 |  |                                    | 200         |  |                          |  | 1.00   | %              |  | November |  |   | 5                           |  |  |                              | 44       
|Sociedad Portuaria Olefinas                  |  |                                    | 249,992     |  |                          |  | 50.00  | %              |  | November |  |   | 649                         |  |  |                              | 1,462    
|Los Arces Group                              |  |                                    | 10,001      |  |                          |  | 100.00 | %              |  | December |  |   | 5,100                       |  |  |                              | 5,100    
|Amandine Holding                             |  |                                    | 500         |  |                          |  | 100.00 | %              |  | December |  |   | 6,657                       |  |  |                              | 6,657    
|                                             |  |                                    |             |  |                          |  |        |                |  |          |  | $ | 12,805                      |  |  | $                            | 14,741   
|Non-Strategic                                |  |                                    |             |  |                          |  |        |                |  |          |  |   |                             |  |  |                              |          
|Empresa de Energía de Bogotá                 |  |                                    | 631,098,000 |  |                          |  | 6.87   | %              |  | December |  |   | 154,375                     |  |  |                              | 968,736  
|Interconexión Eléctrica S.A.                 |  |                                    | 58,925,480  |  |                          |  | 5.32   | %              |  | December |  |   | 69,549                      |  |  |                              | 536,222  
|Concentra Inteligencia en Energía
    S.A.S. |  |                                    | 168,000     |  |                          |  | 9.52   | %              |  | November |  |   | 168                         |  |  |                              | 150      
|                                             |  |                                    |             |  |                          |  |        |                |  |          |  | $ | 224,092                     |  |  | $                            | 1,505,108
|                                             |  |                                    |             |  |                          |  |        |                |  |          |  | $ | 236,897                     |  |  | $                            | 1,519,849



F-22







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Summary of long-term variable
yield-investments as of December 31, 2012, recognized using the cost method:



|Equity Share                             |  | Number of Shares
    and/or Quotas |             |  | Participation Percentage |  |      | Valuation Date |  | Cost     |  |   | Market/ Intrinsic
    Value |  |  | Appreciation/ (Depreciation) |          
|---------------------------------------- |  | ---------------------------------- | ----------- |  | ------------------------ |  | ---- | -------------- |  | -------- |  | - | --------------------------- |  |  | ---------------------------- | ---------
|Strategic                                |  |                                    |             |  |                          |  |      |                |  |          |  |   |                             |  |  |                              |          
|Zona Franca de Cartagena S.A.            |  |                                    | 290         |  |                          |  | 10   | %              |  | November |  | $ | 394                         |  |  | $                            | 1,163    
|Sociedad Portuaria del Dique             |  |                                    | 200         |  |                          |  | 1    | %              |  | November |  |   | 5                           |  |  |                              | 20       
|Sociedad Portuaria Olefinas              |  |                                    | 249,992     |  |                          |  | 50   | %              |  | November |  |   | 250                         |  |  |                              | 439      
|Los Arces Group                          |  |                                    | 10,001      |  |                          |  | 100  | %              |  | December |  |   | 5,100                       |  |  |                              | 5,100    
|Amandine Holding                         |  |                                    | 500         |  |                          |  | 100  | %              |  | December |  |   | 6,657                       |  |  |                              | 6,657    
|                                         |  |                                    |             |  |                          |  |      |                |  |          |  | $ | 12,406                      |  |  | $                            | 13,379   
|Non-Strategic                            |  |                                    |             |  |                          |  |      |                |  |          |  |   |                             |  |  |                              |          
|Empresa de Energía de Bogotá             |  |                                    | 631,098,000 |  |                          |  | 6.87 | %              |  | December |  |   | 154,375                     |  |  |                              | 801,494  
|Interconexión Eléctrica S.A.             |  |                                    | 58,925,480  |  |                          |  | 5.32 | %              |  | December |  |   | 69,549                      |  |  |                              | 565,683  
|Concentra Inteligencia en Energía S.A.S. |  |                                    | 168,000     |  |                          |  | 9.52 | %              |  | November |  |   | 168                         |  |  |                              | 159      
|                                         |  |                                    |             |  |                          |  |      |                |  |          |  | $ | 224,092                     |  |  | $                            | 1,367,336
|                                         |  |                                    |             |  |                          |  |      |                |  |          |  | $ | 236,498                     |  |  | $                            | 1,380,715



Restrictions on Long-term
Investments - Variable Income:



As of January 10, 2013, regarding
the legal proceedings of Invercolsa S.A.: The cessation appeal filed by AFIB S.A. and Fernando Londoño Hoyos against the
judgment passed by the 28th Civil Court of the Circuit on February 8, 2007, that was confirmed by the Superior Court of the District
of Bogota - Civil Court, on January 11, 2011 is currently in process. On October 22, 2012, the term for the cessation appellant
AFIB S.A. to support the corresponding appeal expired, which was done in time and the term for the appellant cessation Fernando
Londoño Hoyos to support his started to run, which was also done in time. Therefore, on December 5, 2012, the Court Clerk’s
Office indicated that having notified the appellants, the corresponding actions were filed in due time and are included in the
case file, a report that was delivered to the court that same day. The notification of the complaint to the Company is pending.



The appeal sentence of January
11, 2011 ordered: i) That the purchase of 145 million shares of Invercolsa by Fernando Londoño Hoyos are to be cancelled;
ii) that the cancellation of the said transaction is to be recorded in the shareholders’ book, including the pledge in favor
of the Pacífico Colombia y Panamá banks, as well as the payment in kind of the shares of Arrendadora Financiera
Internacional Bolivariana S.A.; iii) that Fernando Londoño Hoyos and AFIB are forced to return the Invercolsa dividends,
along with the new shares received as profit and/or revaluations; iv) to declare that Fernando Londoño Hoyos did not acquire
or possess in good faith the 145 million Invercolsa shares; and v) that Invercolsa is to adjust its operation and the Shareholders’
meeting to the declarations made in the sentence.



The economic activities for
the entities in which the Group has investments are:



|Company                          |  | Economic
    activity                                                                                                                               
|-------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------
|Invercolsa S.A.                  |  | Investments in
    companies in the energy sector including activities specific to of the commercialization of hydrocarbons and mining              
|Serviport S.A.                   |  | Support services
    for loading and unloading of oil vessels, supply of equipment for the same purpose, technical inspection and cargo measurements
|Ecodiesel Colombia
    S.A.      |  | Production, commercialization
    and distribution of biofuels and oleo chemicals                                                                   
|Offshore International
    Group |  | Exploration, development,
    production and processing of hydrocarbons                                                                             



Maturity of Fixed-yield
Investments



A summary of the maturity
of fixed-yield investments as of December 31, 2013, is comprised as follows:



|Maturity                              |  | >1 - 3 Years |         |  | 3 - 5 Years |   |         | > 5 Years |  |   | Total  | 
|------------------------------------- |  | ------------ | ------- |  | ----------- | - | ------- | --------- |  | - | ------ | 
|Bonds and other foreign securities    |  | $            | 8,251   |  |             | $ | 5,730   |           |  | $ | -      | 
|Bonds and other government securities |  |              | -       |  |             |   | 86,616  |           |  |   | -      | 
|Specific destination fund             |  |              | 217,011 |  |             |   | 1,994   |           |  |   | 41,955 | 
|Other (1)                             |  |              | -       |  |             |   | 6,297   |           |  |   | -      | 
|                                      |  | $            | 225,262 |  |             | $ | 100,637 |           |  | $ | 41,955 | 



| | (1) | In 2013, others of Ecopetrol Oleo
                                         e Gas do Brasil correspond to investments available for sales with Banco Santander of
                                         $6,297.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-23







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



A summary of the maturity
of long term fixed-yield investments as of December 31, 2012 is as follows:



|Maturity                              |  | >1 - 3 Years |           |  | 3 - 5 Years |   |         | > 5 Years |  |   | Total   | 
|------------------------------------- |  | ------------ | --------- |  | ----------- | - | ------- | --------- |  | - | ------- | 
|Bonds and other foreign securities    |  | $            | 1,845,673 |  |             | $ | 226,284 |           |  | $ | -       | 
|Bonds and other government securities |  |              | 628,816   |  |             |   | 304,048 |           |  |   | 75,569  | 
|Treasury securities – TES             |  |              | 772,747   |  |             |   | 148,949 |           |  |   | 314,470 | 
|Specific purpose fund                 |  |              | 58,328    |  |             |   | 63,339  |           |  |   | 272,249 | 
|Other (1)                             |  |              | 24,561    |  |             |   | -       |           |  |   | -       | 
|                                      |  | $            | 3,330,125 |  |             | $ | 742,620 |           |  | $ | 662,288 | 



| | (1) | Ecopetrol Oleo
                                         e Gas do Brasil has financial investments in Citibank in the amount of $24,492, given
                                         as a granted a guarantee to the ANP (equivalent to ANH) until it approves ECP Brazil’s
                                         participation in the Vanco-BM-S-63, 71 and 72 drilling blocks. Following said approval,
                                         this amount will be transferred to the purchase of participation, and in the event that
                                         it is not approved, the amount will be returned.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (5) | Accounts and Notes Receivable,
                                         Net
| | --- | ---------------------------------------------------------------------------



The balance of accounts
and notes receivable, is comprised as follows:



|                                                                                |  | As of December 31,2013 |           |   | As of December 31,
    2012 |  
|------------------------------------------------------------------------------- |  | ---------------------- | --------- | - | --------------------------- | -
|Current:                                                                        |  |                        |           |   |                             |  
|Customers:                                                                      |  |                        |           |   |                             |  
|National                                                                        |  | $                      | 1,121,881 |   |                             | $
|Foreign                                                                         |  |                        | 2,943,686 |   |                             |  
|Price differential to be received from the Ministry of Mines and Energy
    (1) |  |                        | 1,058,738 |   |                             |  
|Various debtors                                                                 |  |                        | 988,904   |   |                             |  
|Reimbursements and yields on investment                                         |  |                        | 439       |   |                             |  
|Association contracts - joint ventures                                          |  |                        | -         |   |                             |  
|Accounts receivable from employees                                              |  |                        | 23,821    |   |                             |  
|Doubtful accounts                                                               |  |                        | 228,899   |   |                             |  
|Industrial service clients                                                      |  |                        | 14,594    |   |                             |  
|Capivetrol - Loans to employees (2)                                             |  |                        | 50,844    |   |                             |  
|Total                                                                           |  | $                      | 6,431,806 |   |                             | $
|Less - Allowance for doubtful accounts                                          |  |                        | (254,915  | ) |                             |  
|Total current                                                                   |  | $                      | 6,176,891 |   |                             | $
|Long term:                                                                      |  |                        |           |   |                             |  
|National                                                                        |  |                        | 5,664     |   |                             |  
|Foreign                                                                         |  |                        | 2,506     |   |                             |  
|Cavipetrol - Loans to employees (2)                                             |  |                        | 393,158   |   |                             |  
|Price differential to be received from the Ministry of Mines and Energy (1)     |  |                        | 77,510    |   |                             |  
|Doubtful accounts                                                               |  |                        | 10,227    |   |                             |  
|Other                                                                           |  |                        | 30,991    |   |                             |  
|Total Long term                                                                 |  | $                      | 520,056   |   |                             | $



Determination and classification
of the client portfolio as of December 31, 2013, according to maturity



|                  |  | Days to maturity |          
|----------------- |  | ---------------- | ---------
|                  |  | 0 – 180          |          
|Current portfolio |  | $                | 3,847,147
|Default portfolio |  |                  | 217,130  
|                  |  |                  | 4,064,277
|                  |  |                  |          
|Clients           |  |                  | 1,121,736
|Foreign clients   |  |                  | 2,942,541
|                  |  | $                | 4,064,277



F-24







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Determination and classification
of the client portfolio as of December 31, 2012, according to maturity:



|                  |  | Days to maturity |          
|----------------- |  | ---------------- | ---------
|                  |  | 0 – 180          |          
|Current portfolio |  | $                | 3,226,140
|Default portfolio |  |                  | 123,848  
|                  |  |                  | 3,349,988
|                  |  |                  |          
|National clients  |  |                  | 948,658  
|Foreign clients   |  |                  | 2,401,330
|                  |  | $                | 3,349,988



*Client portfolio included
in doubtful debts.



The following shows the movement
in the allowance for doubtful accounts:



|                                                              |  | As of December 31,
    2013 |         |   | As of December 31,
    2012 |  
|------------------------------------------------------------- |  | --------------------------- | ------- | - | --------------------------- | -
|Opening Balance                                               |  | $                           | 235,552 |   |                             | $
|Additions (new allowances)                                    |  |                             | 31,681  |   |                             |  
|Recovery of allowances                                        |  |                             | (2,717  | ) |                             |  
|Accounts receivable write-off                                 |  |                             | (255    | ) |                             |  
|Use of allowances and adjustments for exchange
    difference |  |                             | (9,346  | ) |                             |  
|Closing Balance                                               |  | $                           | 254,915 |   |                             | $



| | (1) | Accounts receivable from the
                                         Ministry of Finance, arising from the calculation of the regular motor gasoline and diesel
                                         price differential pursuant to Resolution 180522 issued on March 29, 2010.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | By means of Leg contracts 058-80
                                         of 1980 and 4008928 of 2006, the administration, management and control of loans granted
                                         to employees by the Company were transferred to Cavipetrol. In its capacity as administrator,
                                         Cavipetrol monitors, in its database and financial system, the details per employee of
                                         said loans and their respective conditions.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Future collection of accounts
receivable from Cavipetrol as of December 31, 2013 are estimated as follows:



|Year            |  | Value |        
|--------------- |  | ----- | -------
|2014            |  | $     | 50,844 
|2015            |  |       | 50,640 
|2016 and beyond |  |       | 322,156
|                |  | $     | 423,640



Similarly, at December 31,
2013 loans had been made to the employees of Equión in the amount of $10,966, Hocol in the amount of $9,056, Propilco in
the amount of $225, Comai in the amount of $107 and Ecopetrol Oleo e gas do Brasil Ltd in the amount $8.



F-25







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (6) | Inventories
| | --- | -----------



The balance of inventories,
net, is comprised as follows:



|                                     |  | As of December 31, 
    2013 |           |   | As of December 31, 
    2012 |  
|------------------------------------ |  | ---------------------------- | --------- | - | ---------------------------- | -
|Finished products                    |  |                              |           |   |                              |  
|Crude oil                            |  | $                            | 1,179,509 |   |                              | $
|Fuels                                |  |                              | 895,384   |   |                              |  
|Petrochemicals                       |  |                              | 87,024    |   |                              |  
|Purchased products                   |  |                              |           |   |                              |  
|Fuels                                |  |                              | 124,269   |   |                              |  
|Crude oil                            |  |                              | 419,203   |   |                              |  
|Petrochemicals                       |  |                              | 21,790    |   |                              |  
|Agricultural products                |  |                              | 869       |   |                              |  
|Raw materials                        |  |                              |           |   |                              |  
|Crude oil                            |  |                              | 31,854    |   |                              |  
|Petrochemicals                       |  |                              | 36,985    |   |                              |  
|Products in process                  |  |                              |           |   |                              |  
|Fuels                                |  |                              | 362,929   |   |                              |  
|Petrochemicals                       |  |                              | 11,309    |   |                              |  
|Packaging material                   |  |                              | 1,940     |   |                              |  
|Materials for production of goods    |  |                              | 48,973    |   |                              |  
|Materials in transit                 |  |                              | 79,746    |   |                              |  
|Total                                |  | $                            | 3,301,784 |   |                              | $
|Less - Allowance
    for inventories |  |                              | (42,385   | ) |                              |  
|Total                                |  | $                            | 3,259,399 |   |                              | $



The movement in
the allowance for inventories is comprised as follows:



|                              |  | As of December 31, 
    2013 |        |  | As of December 31, 
    2012 |  
|----------------------------- |  | ---------------------------- | ------ |  | ---------------------------- | -
|Opening balance               |  | $                            | 27,150 |  |                              | $
|Allowance increase (decrease) |  |                              | 15,235 |  |                              |  
|Closing Balance               |  | $                            | 42,385 |  |                              | $



Natural gas imbalance - The
Group uses the entitlement method of accounting for gas balancing agreements, through which the amount of natural gas sold is
based on the shared ownership interest. The Group had a gas imbalance as of December 31, 2013 of $4,142 (US$2,064,417) in its
favor, equivalent to 516,436 MBTU. The Group had a gas imbalance as of December 31, 2012 of $5,713 (US$3,241,756) in its favor,
equivalent to 574,109 MBTU. Natural gas imbalances are settled through sales or purchases to or from the partner, accounted for
at the end of the period.



| | (7) | Advances and Deposits
| | --- | ---------------------



The balance of advances
and deposits is comprised as follows:



|                               |  | As of December 31, 
    2013 |           |  | As of December 31, 
    2012 |  
|------------------------------ |  | ---------------------------- | --------- |  | ---------------------------- | -
|Current                        |  |                              |           |  |                              |  
|Official entities (1)          |  | $                            | 7,845,825 |  |                              | $
|Partners in joint ventures (2) |  |                              | 388,276   |  |                              |  
|Customs agents                 |  |                              | 3,587     |  |                              |  
|Advances to contractors        |  |                              | 12,610    |  |                              |  
|Agreements (3)                 |  |                              | 19,593    |  |                              |  
|Advances to employees          |  |                              | 855       |  |                              |  
|Advances to suppliers          |  |                              | 343,304   |  |                              |  
|Total current                  |  | $                            | 8,614,050 |  |                              | $
|Long term                      |  |                              |           |  |                              |  
|Advances and deposits          |  |                              | 192,613   |  |                              |  
|Total                          |  | $                            | 8,806,663 |  |                              | $



F-26







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (1) | Corresponds to the National
                                         Tax and Customs Direction (from the Spanish Dirección de Impuestos y Aduanas
                                         Nacionales - DIAN) from advances on income tax for the 2013 tax year in the amount
                                         of $4,699,415 (2012 - $3,480,067), VAT credit balance in the amount of $1,394,344 (2012
                                         - $303,954), and self-withholdings and others in the amount of $1,752,066 (2012 - $1,272,058).
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | The detail of advances and
                                         deposits with partners in joint operations is comprised as follows:
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------



|Contracts in which Ecopetrol is not the Operator |  | As of December 31,
    2013 |         |  | As of December 31,
    2012 |  
|------------------------------------------------ |  | --------------------------- | ------- |  | --------------------------- | -
|Meta Petroleum Ltd.                              |  | $                           | 39,787  |  |                             | $
|Occidental de Colombia Inc.                      |  |                             | 26,907  |  |                             |  
|Perenco Colombia Limited                         |  |                             | 25,721  |  |                             |  
|Petrobras Colombia Limited                       |  |                             | 21,770  |  |                             |  
|Repsol Exploracion Colombia S.A.                 |  |                             | 16,166  |  |                             |  
|Anadarko Colombia Company                        |  |                             | 15,245  |  |                             |  
|Emerald Energy PLC Suc Colombia                  |  |                             | 13,375  |  |                             |  
|Vanco Energy                                     |  |                             | 7,352   |  |                             |  
|Mansarovar Energy Colombia Ltd.                  |  |                             | 6,744   |  |                             |  
|Occidental Andina Llc                            |  |                             | 5,559   |  |                             |  
|CEPSA Colombia S.A.                              |  |                             | 4,484   |  |                             |  
|Petrosantander Colombia Inc.                     |  |                             | 4,182   |  |                             |  
|Petroleos del Norte S.A.                         |  |                             | 3,822   |  |                             |  
|Chevron Petroleum Company                        |  |                             | 2,698   |  |                             |  
|Anadarko Petroleum Corporation                   |  |                             | 275     |  |                             |  
|Petrobras Energía Perú S.A.                      |  |                             | 181     |  |                             |  
|Petrobras Internacional Braspetro B.V.           |  |                             | 127     |  |                             |  
|Talisman Perú BV, Sucursal del Perú              |  |                             | 111     |  |                             |  
|Petrominerales                                   |  |                             | 78      |  |                             |  
|Maurel et Prom Colombia B.V.                     |  |                             | -       |  |                             |  
|Lewis Energy Colombia                            |  |                             | -       |  |                             |  
|Other operations                                 |  |                             | 10,546  |  |                             |  
|Contracts in which Ecopetrol is the Operator:    |  |                             |         |  |                             |  
|Block CPO-9                                      |  |                             | 89,962  |  |                             |  
|La Cira                                          |  |                             | 23,712  |  |                             |  
|Heavy Crude Oil Block CPE-4                      |  |                             | 19,137  |  |                             |  
|Oleoducto Caño Limón                             |  |                             | 16,360  |  |                             |  
|Operating Agreement TLU-3                        |  |                             | 10,028  |  |                             |  
|Heavy Crude Oil Block CPE-2                      |  |                             | 8,816   |  |                             |  
|Master Agreement TLU-1                           |  |                             | 5,817   |  |                             |  
|JOA Caño Sur                                     |  |                             | 3,838   |  |                             |  
|Niscota                                          |  |                             | -       |  |                             |  
|CRC 2004 – 01                                    |  |                             | -       |  |                             |  
|Other operations                                 |  |                             | 5,476   |  |                             |  
|Total                                            |  | $                           | 388,276 |  |                             | $



| | (3) | Represents the resources transferred
                                         to employees as an advance for the education plan.
| | --- | --------------------------------------------------------------------------------------------------------------------------------



| | (8) | Prepaid
                                         Expenses
| | --- | ---------------------------------------------------------



The balance of prepaid
expenses is as follows:



|              |  | As of December 31,
    2013 |         |  | As of December 31,
    2012 |  
|------------- |  | --------------------------- | ------- |  | --------------------------- | -
|Insurance (1) |  | $                           | 144,890 |  |                             | $
|Other (2)     |  |                             | 3,454   |  |                             |  
|Total         |  | $                           | 148,344 |  |                             | $



| | (1) | Insurance contracts are in
                                         effect until June 15, 2014, at a cost of $232,385 and amortization of $162,982, as of
                                         December 31, 2013.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-27







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



As of December 31, 2013 the
prepaid insurance of other companies in the Group was comprised by: Refinería de Cartagena in the amount of $59,804, Oleoducto
Bicentenario in the amount of $33, Ecopetrol America Inc. in the amount of $6,268, Equión in the amount of $1,661, Propilco
in the amount of $2,035, Ocensa in the amount of $567, Hocol in the amount of $751, Oleoducto de Colombia in the amount of $123,
Bioenergy in the amount of $120, Comai in the amount of $60, Ecopetrol Perú in the amount of $2 and Cenit in the amount
of $4,063.



| | (2) | Include resources relating
                                         to the acquisition and maintenance of vehicles assigned to senior officials of Ecopetrol
                                         S.A. through leasing, managed by Cavipetrol under Contract No. 5203585; other prepaid
                                         goods and services, and prepaid medicine in the amount of $2,564.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (9) | Deposits
                                         Held in Trust
| | --- | ---------------------------------------------------------------



The balance of deposits
given in administration included:



|                                     |  | As of December 31, 
    2013 |         |  | As of December 31, 
    2012 |  
|------------------------------------ |  | ---------------------------- | ------- |  | ---------------------------- | -
|Abandonment funds                    |  | $                            | -       |  |                              | $
|Corficolombiana Securitization - ODL |  |                              | 134,015 |  |                              |  
|Administered by Cavipetrol           |  |                              | 9,951   |  |                              |  
|Pension Funds                        |  |                              | 314,114 |  |                              |  
|Other                                |  |                              | 20,665  |  |                              |  
|                                     |  | $                            | 478,745 |  |                              | $



These balances correspond
to trust funds for pensions and abandonment costs. They were created under Occidental de Colombia and received upon termination
of the Asociación Cravo Norte - ACN contract, which came into effect in February 2011. The pension funds are administered
by Fiduciaria Bancolombia. On 2013, the ownership of the abandonment fund was transferred to Cenit together with all the assets
associated with such fund.



| | (10) | Property, Plant and Equipment,
                                         Net
| | ---- | ---------------------------------------------------------------------------



The balance of property,
plant and equipment, net is comprised as follows:



|                                                             |  | As of December 31, 
    2013 |             |   | As of December 31, 
    2012 |  
|------------------------------------------------------------ |  | ---------------------------- | ----------- | - | ---------------------------- | -
|Plant and equipment                                          |  | $                            | 17,414,050  |   |                              | $
|Construction in progress (1)                                 |  |                              | 20,887,747  |   |                              |  
|Pipelines, networks and lines                                |  |                              | 22,155,218  |   |                              |  
|Buildings                                                    |  |                              | 4,370,321   |   |                              |  
|Equipment on deposit and in transit                          |  |                              | 1,658,992   |   |                              |  
|Computer equipment                                           |  |                              | 552,013     |   |                              |  
|Transportation equipment and other assets                    |  |                              | 1,725,372   |   |                              |  
|Agricultural plantations                                     |  |                              | 62,862      |   |                              |  
|Operating materials                                          |  |                              | 171,107     |   |                              |  
|Land                                                         |  |                              | 1,210,830   |   |                              |  
|Total                                                        |  | $                            | 70,208,512  |   |                              | $
|Less - Accumulated depreciation                              |  |                              | (24,749,083 | ) |                              |  
|Allowance for property, plant and equipment depreciation (2) |  |                              | (460,749    | ) |                              |  
|Total                                                        |  | $                            | 44,998,680  |   |                              | $



Depreciation charged to results
of operations as of December 31, 2013 amounted to $1,982,706 (2012 - $2,027,658).



| | (1) | Principally includes
                                         the following:
| | --- | ----------------------------------------------------------------------------



| | i) | Investments
                                         made for the project of expansion and modernization of the Reficar plant in the amount
                                         of $3,137,950, as well as exploration and production investments in direct-operation
                                         production projects, such as development (Castilla, Chichimene, Apiay, Yarigui and Providencia)
                                         and the joint operation development projects (Rubiales, Piedemonte, La Cira and Quifa);
                                         major projects in refining such as the modernization of the Barrancabermeja Refinery
                                         and the Master Plan for Industrial Services; in transportation, the Master Plan for the
                                         Refinery Integration;
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ii) | The capitalized portion of interests
                                         amounting to $7,177 related to the syndicated loan; $37,638, related to the bonds in
                                         dollars issued during 2009; $5,606, related to bonds in pesos issued during 2009; $84,858,
                                         related to bonds in dollars issued during 2013; $2,014, related to Exim Bank Long Term
                                         Guarantee; and $269, related to Exim Bank Credit Guarantee Facility.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





F-28







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (2) | The following details the movement
                                         in the allowance for property, plant and equipment depreciation:
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------



|                            |  | December 31, 
    2013 |          |   | December 31, 
    2012 |  
|--------------------------- |  | ---------------------- | -------- | - | ---------------------- | -
|Opening Balance             |  | $                      | 563,996  |   |                        | $
|Additions to new allowances |  |                        | 122,514  |   |                        |  
|Use of allowances           |  |                        | (154,997 | ) |                        |  
|Depreciation of assets      |  |                        | (2,765   | ) |                        |  
|Recovery                    |  |                        | (67,999  | ) |                        |  
|Closing Balance             |  | $                      | 460,749  |   |                        | $



Summary of property, plant
and equipment as of December 31, 2013:



|Type of asset                             |  | Adjusted Cost |            |  | Accumulated 
    depreciation |   |             | Appreciation |  |   | Allowance  | 
|----------------------------------------- |  | ------------- | ---------- |  | ----------------------------- | - | ----------- | ------------ |  | - | ---------- | 
|Plant and equipment                       |  | $             | 17,414,050 |  |                               | $ | (10,988,634 | )            |  | $ | 5,144,384  | 
|Pipelines, networks and lines             |  |               | 22,155,218 |  |                               |   | (10,992,888 | )            |  |   | 14,588,429 | 
|Construction in progress                  |  |               | 20,887,747 |  |                               |   | -           |              |  |   | -          | 
|Agricultural plantations                  |  |               | 62,862     |  |                               |   | -           |              |  |   | -          | 
|Buildings                                 |  |               | 4,370,321  |  |                               |   | (1,468,769  | )            |  |   | 2,231,945  | 
|Equipment on deposit and in transit       |  |               | 1,658,992  |  |                               |   | -           |              |  |   | -          | 
|Computer equipment                        |  |               | 552,013    |  |                               |   | (391,669    | )            |  |   | 38,775     | 
|Transportation equipment and other assets |  |               | 1,725,372  |  |                               |   | (907,123    | )            |  |   | 245,422    | 
|Land                                      |  |               | 1,210,830  |  |                               |   | -           |              |  |   | 3,429,171  | 
|Operating material                        |  |               | 171,107    |  |                               |   | -           |              |  |   | -          | 
|Total                                     |  | $             | 70,208,512 |  |                               | $ | (24,749,083 | )            |  | $ | 25,678,126 | 



Summary of property, plant
and equipment as of December 31, 2012:



|Type of asset                             |  | Adjusted cost |            |  | Accumulated 
    depreciation |   |             | Appreciation |  |   | Allowance  | 
|----------------------------------------- |  | ------------- | ---------- |  | ----------------------------- | - | ----------- | ------------ |  | - | ---------- | 
|Plant and equipment                       |  | $             | 17,835,237 |  |                               | $ | (11,818,813 | )            |  | $ | 5,160,255  | 
|Pipelines, networks and lines             |  |               | 19,799,381 |  |                               |   | (11,628,422 | )            |  |   | 8,533,118  | 
|Construction in progress                  |  |               | 17,474,710 |  |                               |   | -           |              |  |   | -          | 
|Buildings                                 |  |               | 4,295,597  |  |                               |   | (1,608,846  | )            |  |   | 2,267,564  | 
|Equipment on deposit and in transit       |  |               | 1,394,003  |  |                               |   | -           |              |  |   | -          | 
|Computer equipment                        |  |               | 580,225    |  |                               |   | (423,614    | )            |  |   | 35,915     | 
|Agricultural plantation                   |  |               | 44,428     |  |                               |   | -           |              |  |   | -          | 
|Transportation equipment and other assets |  |               | 1,668,096  |  |                               |   | (798,900    | )            |  |   | 369,031    | 
|Land                                      |  |               | 745,632    |  |                               |   | -           |              |  |   | 3,137,790  | 
|Operating material                        |  |               | 140,237    |  |                               |   | -           |              |  |   | -          | 
|Total                                     |  | $             | 63,977,546 |  |                               | $ | (26,278,595 | )            |  | $ | 19,503,673 | 



There are no restrictions
or pledges on assets, nor have they been offered as security.



Technical appraisals of fixed
assets take place every three years in accordance with the provisions of the Regime of Public Accounting.



F-29









Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (11) | Natural and Environmental
                                         Resources, Net
| | ---- | ---------------------------------------------------------------------------------



The balance of natural
and environmental resources, net is comprised as follows:



|                                                                                    |  | As of December 31, 
    2013 |             |   | As of December 31, 
    2012 |  
|----------------------------------------------------------------------------------- |  | ---------------------------- | ----------- | - | ---------------------------- | -
|Amortizable oil investments (1)                                                     |  | $                            | 38,982,903  |   |                              | $
|Less: Accumulated amortization (2)                                                  |  |                              | (23,159,772 | ) |                              |  
|                                                                                    |  | $                            | 15,823,131  |   |                              | $
|Plugging and abandonment, facility dismantling and environmental recovery costs (3) |  |                              | 4,936,316   |   |                              |  
|Less: Accumulated amortization (2)                                                  |  |                              | (2,309,036  | ) |                              |  
|                                                                                    |  | $                            | 2,627,280   |   |                              | $
|Reservoirs and appraisals (4)                                                       |  |                              | 701,590     |   |                              |  
|Less: Accumulated depletion                                                         |  |                              | (642,299    | ) |                              |  
|                                                                                    |  | $                            | 59,291      |   |                              | $
|Exploration in progress (5)                                                         |  |                              | 2,946,957   |   |                              |  
|Total                                                                               |  | $                            | 21,456,659  |   |                              | $



| | (1) | As of December 31, 2013, net
                                         capital expenditures of oil investments amounted to $4,125,655 mainly in the following
                                         fields: Rubiales, Castilla, Chichimene, Casabe, Apiay, Quifa, Cupiagua and Caño
                                         Limón.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | The total amortization charged
                                         to results related to natural resources and abandonment cost, 2013 was $2,865,778 and
                                         $220,238, respectively ($2,682,955 and $312,252, respectively in 2012).
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | Corresponds to the cost of
                                         abandoning production areas, updated in December 2013.
| | --- | --------------------------------------------------------------------------------------------------------------------------



| | (4) | The appraisal of reserves is
                                         represented by the reservoirs received through the reverting of concession contracts
                                         in the amount of $490,525 administered by Gerencia Magdalena Medio, $184,208 administered
                                         by Gerencia Sur and $26,857 administered by Gerencia Catatumbo Orinoquía.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (5) | Corresponds to explorations
                                         activity: Ecopetrol in the amount of $1,645,390; Ecopetrol Oleo e Gas de Brasil in the
                                         amount of $158,102, Ecopetrol America Inc. in the amount of $481,633, Hocol Petroleum
                                         in the amount of $428,732 and Equion in the amount of $233,100.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (12) | Deferred Charges
| | ---- | ----------------



The balance of deferred
charges is comprised as follows:



|                                               |  | As of December 31, 
    2013 |           |  | As of December 31, 
    2012 |  
|---------------------------------------------- |  | ---------------------------- | --------- |  | ---------------------------- | -
|Other deferred charges, net (1)                |  | $                            | 1,891,961 |  |                              | $
|Deferred income tax and deferred tax on CREE * |  |                              | 2,112,829 |  |                              |  
|Deferred monetary correction charges, net      |  |                              | -         |  |                              |  
|                                               |  | $                            | 4,004,790 |  |                              | $



| | (1) | Includes investments made in
                                         developing the business cooperation contract between Ecopetrol and Schlumberger aimed
                                         at increasing production at the Casabe field. These investments are amortized based on
                                         technical units of field production. For 2013 this amortization amounts to $115,991 (2012
                                         - $72,024). In addition it includes pre-operating expenses of Bioenergy for $119,880
                                         (2012 - $77,960).
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



* CREE does not apply for
the year 2012.



| | (13) | Other
                                         Assets
| | ---- | -----------------------------------------------------



The detail of other
assets is comprised as follows:



|                                                                              |  | As of December 31, 
    2013 |           |  | As of December 31, 
    2012 |  
|----------------------------------------------------------------------------- |  | ---------------------------- | --------- |  | ---------------------------- | -
|Goodwill (1)                                                                  |  | $                            | 2,175,084 |  |                              | $
|Intangible assets, net: (brands, licenses, patents and software)              |  |                              | 293,286   |  |                              |  
|Trust funds (2)                                                               |  |                              | 217,980   |  |                              |  
|National Royalties Fund (from the Spanish
    Fondo Nacional de Regalías) (3) |  |                              | 73,469    |  |                              |  
|Other assets (4)                                                              |  |                              | 740,776   |  |                              |  
|                                                                              |  | $                            | 3,500,595 |  |                              | $



F-30







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011





| | (1) | Goodwill as of December 31,
                                         2013 is comprised as follows:
| | --- | --------------------------------------------------------------------------------------------------



|Company                    |  | Acquisition Date |  | Goodwill 
    Amount |           |  | Amortized 
    Amount |   |          | Pending
    Amortization |  |   | Amortization 
    Period (Years) | 
|-------------------------- |  | ---------------- |  | -------------------- | --------- |  | --------------------- | - | -------- | ------------------------ |  | - | -------------------------------- | 
|Propilco S.A. (a)          |  | 07/04/2008       |  | $                    | 176,507   |  |                       | $ | (68,370  | )                        |  | $ | 108,137                          | 
|Andean Chemicals           |  | 07/04/2008       |  |                      | 205,541   |  |                       |   | (77,729  | )                        |  |   | 127,812                          | 
|IPL Enterprises (b)        |  | 17/03/2009       |  |                      | 880,127   |  |                       |   | (196,631 | )                        |  |   | 683,496                          | 
|Offshore International (a) |  | 06/02/2009       |  |                      | 536,079   |  |                       |   | (194,631 | )                        |  |   | 341,448                          | 
|Hocol Petroleum Limited    |  | 27/05/2009       |  |                      | 742,345   |  |                       |   | (204,747 | )                        |  |   | 537,598                          | 
|Equión Energía Limited (b) |  | 24/01/2011       |  |                      | 629,375   |  |                       |   | (253,682 | )                        |  |   | 375,693                          | 
|Bioenergy Zona Franca      |  | 30/08/2008       |  |                      | 900       |  |                       |   | -        |                          |  |   | 900                              | 
|Total                      |  |                  |  | $                    | 3,170,874 |  |                       | $ | (995,790 | )                        |  | $ | 2,175,084                        | 



| | (a) | As of December 31, 2013 an
                                         impairment of goodwill in the amount of $229,876 in Propilco S.A. and $123,136 for Offshore
                                         International Group Company was recorded, due to the economic evaluation made in accordance
                                         with Resolution 145 of 2008 provision, issued by the National Accounting Office.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | Due to the organizational restructuring
                                         made in Ecopetrol's Group with the incorporation of Cenit in 2013, there was a reclassification
                                         in the amount of $343,043 between the goodwill of Equion Energia Limited and IPL Enterprises
                                         corresponding to the value resulting from the acquisition of the participation of Ocensa
                                         owned by Equión.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Goodwill as of December 31,
2012 is comprised as follows:



|Company                 |  | Acquisition Date |  | Goodwill 
    Amount |           |  | Amortized 
    Amount |   |          | Pending 
    Amortization |  |   | Amortization 
    Period (Years) | 
|----------------------- |  | ---------------- |  | -------------------- | --------- |  | --------------------- | - | -------- | ------------------------- |  | - | -------------------------------- | 
|Propilco S.A.           |  | 04/07/2008       |  | $                    | 327,986   |  |                       | $ | (86,572  | )                         |  | $ | 241,414                          | 
|Andean Chemicals        |  | 04/07/2008       |  |                      | 357,629   |  |                       |   | (94,400  | )                         |  |   | 263,229                          | 
|IPL Enterprises         |  | 03/17/2009       |  |                      | 537,093   |  |                       |   | (137,257 | )                         |  |   | 399,836                          | 
|Offshore International  |  | 02/06/2009       |  |                      | 748,986   |  |                       |   | (186,175 | )                         |  |   | 562,811                          | 
|Hocol Petroleum Limited |  | 05/27/2009       |  |                      | 748,948   |  |                       |   | (157,334 | )                         |  |   | 591,614                          | 
|Equión Energía Limited  |  | 01/24/2011       |  |                      | 972,409   |  |                       |   | (189,695 | )                         |  |   | 782,714                          | 
|Bioenergy Zona Franca   |  | 08/30/2008       |  |                      | 900       |  |                       |   | -        |                           |  |   | 900                              | 
|Total                   |  |                  |  | $                    | 3,693,951 |  |                       | $ | (851,433 | )                         |  | $ | 2,842,518                        | 



| | (2) | Includes in Ecopetrol S.A.
                                         the amount of $61,748 comprised as follows: i) $52,421 for contributions and shares in
                                         the National Hydrocarbons Fund (from the Spanish Fondo Nacional de Hidrocarburos)
                                         created to support future hydrocarbon investment, exploration and production contracts
                                         in smaller fields for projects administered by the Colombia Hydrocarbons Private Capital
                                         Fund (from the Spanish Fondo de Capital Privado de Hidrocarburos de Colombia);
                                         and ii) $9,327 from Ecopetrol S.A. in Colpet, Cóndor and Sagoc fund to deal with
                                         potential contingencies in the liquidation of these former subsidiaries.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The amount of $111,481 corresponds
to Oleoducto Bicentenario de Colombia as follows: i) $85,723 for the open collective portfolio into which the money for the quarterly
payment of interest on the syndicated loan is paid ii) $25,582 represents trusts to withhold the money as a guarantee, by contract,
and which is returned upon completion of the work; and iii) $176 for the administrative commercial trust and payments for building
of the terrace by HGC Ingenieros; Bioenergy in the amount of $40,795 to purchase land and Equión in the amount of $3,409.



| | (3) | Corresponds to deposits to
                                         the Oil Savings and Stabilization Fund (from the Spanish Fondo de Ahorro y Estabilización
                                         Petrolera - FAEP) in Ecopetrol’s favor to address the remainder of the National
                                         Royalties Fund. It is sole purpose is the payment debts and financing developments programs
                                         and projects in hydrocarbon producing and non-producing municipalities and departments.
                                         Ecopetrol disburses amounts after the Ministry of Finance issues the corresponding approvals.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (4) | Includes mainly for Ecopetrol
                                         S.A.: i) Restricted funds in the amount of $57,347 (2012 - $50,359), represented by judicial
                                         deposits to pay for labor, civil and tax litigations; and ii) third party property improvements
                                         on assets received through concessions for the Colorados and Tumaco wells in the amount
                                         of $46,750 (2012 - $44,639). ODL Finance in the amount of $141,383, mainly for BOMT contracts,
                                         (2012 - $162,806); Andean includes assets received in partial payment for the obligation
                                         of Lousina Green Fuels in the amount of $58,477; Oleoducto Bicentenario in the amount
                                         of $4,265; Hocol in the amount of $934; Perú in the amount of $640; and Others
                                         in the amount of $122.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-31







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (14) | Valuations
| | ---- | ----------



The valuation balance is comprised
as follows:



|Property, plant and equipment (1)         |  | December 31, 
    2013 |            |  | December 31, 
    2012 |  
|----------------------------------------- |  | ---------------------- | ---------- |  | ---------------------- | -
|Plant and equipment                       |  | $                      | 5,144,384  |  |                        | $
|Buildings                                 |  |                        | 2,231,945  |  |                        |  
|Land                                      |  |                        | 3,429,171  |  |                        |  
|Pipelines                                 |  |                        | 14,588,429 |  |                        |  
|Transportation equipment and other assets |  |                        | 245,422    |  |                        |  
|Communication and computer equipment      |  |                        | 38,775     |  |                        |  
|                                          |  | $                      | 25,678,126 |  |                        | $
|Variable yield investments                |  |                        |            |  |                        |  
|Empresa de Energía de Bogotá S.A. ESP.    |  |                        | 814,361    |  |                        |  
|Interconexión Eléctrica S.A.              |  |                        | 466,673    |  |                        |  
|Sociedad Portuaria Olefinas               |  |                        | 813        |  |                        |  
|Zona Franca Industrial                    |  |                        | 1,123      |  |                        |  
|                                          |  | $                      | 1,282,970  |  |                        | $
|Total                                     |  | $                      | 26,961,096 |  |                        | $



| | (1) | As of December 31, 2013, property,
                                         plant and equipment valuations showed an update of the technical study of fixed-asset
                                         valuation, made by the firms TF Auditores for Ecopetrol S.A. and Refinería de Cartagena
                                         S.A. - Reficar, and Levin Global, for Oleoducto Central S.A. – Ocensa and Oleoducto
                                         de Colombia S.A. - ODC.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (15) | Financial Obligations
| | ---- | ---------------------



The balance of financial obligations
is comprised as follows:



|                              |  | As of December 31, 
    2013 |            |  | As of December 31, 
    2012 |  
|----------------------------- |  | ---------------------------- | ---------- |  | ---------------------------- | -
|Current                       |  |                              |            |  |                              |  
|Debt in national currency (1) |  | $                            | 216,860    |  |                              | $
|Debt in foreign currency (2)  |  |                              | 337,967    |  |                              |  
|Bonds issued (3)              |  |                              | 219,732    |  |                              |  
|Total current                 |  | $                            | 774,559    |  |                              | $
|Long term                     |  |                              |            |  |                              |  
|Debt in national currency (1) |  |                              | 4,805,073  |  |                              |  
|Debt in foreign currency (2)  |  |                              | 14,718,919 |  |                              |  
|Bonds issued (3)              |  |                              | 1,900,000  |  |                              |  
|Total long term               |  | $                            | 21,423,992 |  |                              | $



| | (1) | As of December 31, 2012, it
                                         corresponds to Ecopetrol ́s syndicated loan with eleven national banks for an initial
                                         value of $2,220,200, intended for financing the Company’s investment programs.
                                         The loan was obtained with the following conditions:
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





|Term:                 | 7 years, including a 2-year grace period
|--------------------- | ----------------------------------------
|Payment of Interests: | Starting in November 2009               
|Rate:                 | DTF+ 4% (anticipated quarterly rate)    
|Amortization:         | Every six Months                        





Guarantee: Ecopetrol S.A.
granted a pledge over the stock shares owned either directly or indirectly on the following companies, thus reaching 120% coverage
of the loan amount. The shares given as guarantee were replaced by another contract between some banks and Ecopetrol on November
17, 2011.



The value of guarantees according
to the intrinsic value of the shares of companies and translated into Colombian Pesos with the current TRM al December 31, 2013
is as follows:



|Company                       |  | Value |          
|----------------------------- |  | ----- | ---------
|Hocol Petroleum Limited       |  |       | 2,909,073
|Offshore International Group  |  |       | 489,533  
|Polipropileno del Caribe S.A. |  |       | 313,010  
|Total                         |  |       | 3,711,616





F-32







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The loan was paid off on May
27, 2013 through a debt management and financing operation in local currency with seven Colombian banks for a value of $1,839,000,
which is made up by the following operations:



| | i. | Debt Management Operation: Signed
                                         with 7 local banks for a total value of $1,554,140, whereby the balances outstanding
                                         of the 2009 syndicated loan were replaced.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ii. | New Resources
                                         Operations: Signed with 6 local banks for a total value of $284,860 where by the investment
                                         and general corporate purposes plan is financed.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The new loan was obtained with
the following conditions:



|Disbursement date:    | May 27, 2013                                    
|--------------------- | ------------------------------------------------
|Term:                 | 12 years with a 3-years grace period            
|Payment of interests: | As of November 2013                             
|Rate:                 | DTF + 2.5% (anticipated quarterly rate)         
|Amortization:         | Every Six Months                                
|Guarantee:            | No guarantees were required for the
    new loan



The detail of the amortization
payments of long-term principal is as follows:



|Year |  | Value |          
|---- |  | ----- | ---------
|2016 |  | $     | 102,167  
|2017 |  |       | 204,333  
|2018 |  |       | 204,334  
|2019 |  |       | 204,333  
|2020 |  |       | 204,333  
|2021 |  |       | 204,333  
|2022 |  |       | 204,334  
|2023 |  |       | 204,333  
|2024 |  |       | 204,333  
|2025 |  |       | 102,167  
|     |  | $     | 1,839,000



On 25 November 2013 the first
interest payment was made in the amount of $58,907 million. Currently, Ecopetrol S.A. not anticipate any situation that may represent
noncompliance of its obligations in the near future.



Furthermore, long-term payments
mostly includes, other financial obligations acquired by the companies in the Group, as follows: Oleoducto Bicentenario de Colombia
syndicated loan in the amount of $2,112,669 for 10 years at an interest rate of DTF+4,54%, ODL Finance S.A. syndicated loan in
the amount of $647,029 for 7 years at an interest rate of DTF+2.50% and Bioenergy in the amount of $411,282 for 15 years at an
average interest rate of DTF+3.25%.



The following is the detail
of guarantees granted by ODL as of December 31, 2013:



Irrevocable mercantile trust
agreement between Oleoducto de los Llanos Orientales S.A. Sucursal Colombia and Fiduciaria Corficolombiana S.A. creating ODL –
Ecopetrol Issuer of ODL securities – Ecopetrol trust funds.

Garantee: Loan Securities ODL
- Ecopetrol



According to the contract,
“ODL will use the resources from the placement to finance the project to build and commission the pipeline, and to return
capital to the pipeline sponsors, as established in the Information Prospectus”. In addition, the agreement considers the
creation of a Trustee Fund to administer the resources from the Financial Tariff payments for Ecopetrol, to only be used to make
the debt payments.



Promissory notes were generated,
with the following characteristics:



|Financial Institution |  | Obligation |         |  | No. Promissory Note | 
|--------------------- |  | ---------- | ------- |  | ------------------- | 
|Banco de Bogotá       |  | $          | 416,000 |  |                     | 
|Banco AV Villas       |  |            | 56,000  |  |                     | 
|Banco de Occidente    |  |            | 84,000  |  |                     | 
|Banco Popular         |  |            | 84,000  |  |                     | 
|Total                 |  | $          | 640,000 |  |                     | 



At present, Bioenergy is conducting
the process to pay the mortgage granted by Bancolombia through Finagro credit line is 2008, which is secured with the property
“La Esperanza” whose carrying value is $4,096.



F-33







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (2) | Issuance of International Bond
                                         2009
| | --- | ----------------------------------------------------------------------------



On July 23, 2009, Ecopetrol
S.A. issued unsecured and unsubordinated debt bonds (notes) with the right to register them with the SEC, maturing in 2019, for
an amount of US$1,500 million. The registration took place on October 6, 2009. The notes were initially issued under Rule 144A/Regulation
S.



Terms of the notes were:



Coupon interests: 7,625%

Make Whole Premium: 50 basis
points.

Interest payment dates are
July 23 and January 23 of every year, starting on January 23, 2010.

Maturity date: July 23, 2019.



Issuance of International
Bond 2013



On September 18, 2013, Ecopetrol
S.A. issued unsecured and unsubordinated debt bonds (notes) and registered them with the SEC for the amount of US$2,500 million,
divided into three tranches with the following terms and conditions:



|Redemption Term:       |  |  | 5 years                                                                                          |  |  |  | 10 years                                               |  |  |  | 30 years                                               | 
|---------------------- |  |  | ------------------------------------------------------------------------------------------------ |  |  |  | ------------------------------------------------------ |  |  |  | ------------------------------------------------------ | 
|Date of Maturity       |  |  | Sept
                                         18, 2018                                           |  |  |  | Sept
                                         18, 2023 |  |  |  | Sept
                                         18, 2043 | 
|Amount (US$ million)   |  |  | 350                                                                                              |  |  |  | 1,300                                                  |  |  |  | 850                                                    | 
|Coupon:                |  |  | 4.250%                                                                                           |  |  |  | 5.875%                                                 |  |  |  | 7.375%                                                 | 
|Make Whole Call (pbs): |  |  | 40                                                                                               |  |  |  | 45                                                     |  |  |  | 50                                                     | 
|Payment of interests:  |  |  | March
                                         18 and September 18, starting from March 18, 2014 | 



In accordance with the definitions
contained in the issuance documents for both 2009 and 2013, the Company has complied with the various standard commitments (covenants)
including the due and timely payment of interest and capital; no creation of collateral pledges by Ecopetrol and its subordinates,
except for authorized pledges; and the offer to purchase the bonds in the event of repurchasing for control change.



Reficar incurred indebtedness
in the amount of $6,339,244 million with foreign banks to finance the project to expand the refinery, as follows:



|Contracts                           |  | Lender                                   |  | Agent         |  | Loancurrency |  | Debt
    amount approved inUS$ |               |  | Balance
    as of December31 2013 in US$ |  
|----------------------------------- |  | ---------------------------------------- |  | ------------- |  | ------------ |  | ------------------------------ | ------------- |  | ---------------------------------------- | -
|U.S. Exim Direct Loan Agreement     |  | Export Import Bank de los Estados Unidos |  | BNP Paribas   |  | US$          |  | $                              | 2,650,000,000 |  |                                          | $
|U.S. Exim Guaranteed Loan Agreement |  | HSBC                                     |  | BNP Paribas   |  | US$          |  |                                | 100,000,000   |  |                                          |  
|SACE Facility Agreement             |  | Sumitomo, Bank of Tokyo, BBVA            |  | Sumitomo      |  | US$          |  |                                | 210,000,000   |  |                                          |  
|EKN Facility Agreement              |  | HSBC                                     |  | HSBC          |  | US$          |  |                                | 100,000,000   |  |                                          |  
|Commercial Facility Agreement       |  | Sumitomo, Bank of Tokyo, BBVA , HSBC     |  | Bank of Tokyo |  | US$          |  |                                | 440,000,000   |  |                                          |  
|Total                               |  |                                          |  |               |  |              |  | $                              | 3,500,000,000 |  |                                          | $



The U.S. Congress approved
the granting of guarantees by the U.S. Exim bank to Ecopetrol S.A., through its Long Term Guarantee Programs (LTG) and Medium Term
(CGF). To have access to these programs, the Company selected 4 International banks as lenders in the LTG and 2 for the MTG.



Terms and conditions of the
guarantee programs are as follows:



|Financing Contract: |  | Long term (LTG)                                           |  | Medium
    Term (CGF)                                            
|------------------- |  | --------------------------------------------------------- |  | -----------------------------------------------------------------
|Amount US$ million: |  | Up to 426.6                                               |  | Up to 420.6                                                      
|Term:               |  | Up to 10 years                                            |  | Between 2 and
    7 years                                        
|Interest:           |  | Libor of 6 months + 0.90%                                 |  | Libor of 6 months
    + 0.65%                                    
|Commission:         |  | 0.15% E.A.R
        Share 0.40% Paid in each disbursement |  | 0.15% E.A.R
        Share 0.35% Paid in
        each disbursement
|Guarantee:          |  | Guarantee U.S. Exim Bank on political
    and trade risk  |  |                                                                  
|Amortizations:      |  | Equal every six months                                    |  |                                                                  



As of December 31, 2013, the
Company completed the disburse mounts under the LTG in the amount of US$245 million. US$43 million were received under the CGF
program. Therefore, resources under this facility can be disbursed, valid until June.



F-34







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (3) | Issuance of Local Bond 2010
| | --- | ---------------------------



Through Resolution No. 3150
of October 20, 2010, Ecopetrol was authorized by the Ministry of Finance to issue, subscribe and place internal public debt bonds
for an amount of up to one billion Colombian pesos, to finance Ecopetrol's 2010 investment plan. Subsequently, through Resolution
No. 2176 of November 11, 2010, the Company obtained the authorization of the Superintendence of Finance to register its internal
public debt bonds at the National Register of Securities and Issuers (RNVE), and to place them through public offering.



The terms of the issuance
and placement of the internal public debt bonds are as follows:



|Amount placed: | $1,000,000 million                                                                       
|-------------- | -----------------------------------------------------------------------------------------
|Issuance date: | December 1, 2010                                                                         
|Amortization:  | At maturity                                                                              
|Series A:      | Bonds denominated in pesos at a variable
    rate based on the consumer price index (CPI)



|Redemption Term:  |  | 5 years |                                                     |   | 7 years |   |                                                     | 10 years |  |   | 30 years                                            |  
|----------------- |  | ------- | --------------------------------------------------- | - | ------- | - | --------------------------------------------------- | -------- |  | - | --------------------------------------------------- | -
|Rate:             |  |         | CPI
                                         + 2.80 | % |         |   | CPI
                                         + 3.30 | %        |  |   | CPI
                                         + 3.94 | %
|Amount (millions) |  | $       | 97,100                                              |   |         | $ | 138,700                                             |          |  | $ | 479,900                                             |  



Issuance of Local Bond
2013



With Resolution No. 2462 of
July 30, 2013, issued by the Ministry of Finance and Public Credit, Ecopetrol was authorized to issue, subscribe and place bonds
and trading securities at the Public Securities Market of Colombia amounting up to $3 billion pesos ($3,000,000,000,000) through
public offering.



Subsequently, the Superintendence
of Finance approved the registration of bonds and trading securities under the program, at the National Registry of Securities
and Issuers, and authorized their public offer by Resolution No. 1470 of August 2, 2013.



The following was the result
of the first issuance and placement of internal public debt bonds under the program:





|Amount placed:        | $900,000 million                                                        
|--------------------- | ------------------------------------------------------------------------
|Issuance date:        | August 27, 2013                                                         
|Amortization:         | At maturity                                                             
|Payment of interests: | Every six months                                                        
|Series C:             | Bonds denominated in Colombian pesos at a variable rate based on the CPI







|Redemption Term:  |  | 5 years |                                                     |   | 10 years |   |                                                     | 15 years |  |   | 30 years                                            |  
|----------------- |  | ------- | --------------------------------------------------- | - | -------- | - | --------------------------------------------------- | -------- |  | - | --------------------------------------------------- | -
|Rate:             |  |         | CPI
                                         + 3.79 | % |          |   | CPI
                                         + 4.60 | %        |  |   | CPI
                                         + 4.90 | %
|Amount (millions) |  | $       | 120,950                                             |   |          | $ | 168,600                                             |          |  | $ | 347,500                                             |  



| | (16) | Accounts Payable and Related
                                         Parties
| | ---- | -----------------------------------------------------------------------------



The balance of accounts payable
and transactions with related parties is comprised as follows:



|                                      |  | As of December 31, 
    2013 |           |  | As of December 31, 
    2012 |  
|------------------------------------- |  | ---------------------------- | --------- |  | ---------------------------- | -
|Dividends payable (1)                 |  | $                            | 1,313,596 |  |                              | $
|Suppliers                             |  |                              | 5,459,752 |  |                              |  
|National Hidricarbory Agency          |  |                              | 385,636   |  |                              |  
|Partners advances                     |  |                              | 854,884   |  |                              |  
|Deposits received from third parties  |  |                              | 626,945   |  |                              |  
|Various creditors                     |  |                              | 416,097   |  |                              |  
|Withholding tax on Income tax and VAT |  |                              | 459,866   |  |                              |  
|Reimbursement of exploratory costs    |  |                              | 23,158    |  |                              |  
|Total Current                         |  | $                            | 9,539,934 |  |                              | $
|Other accounts payable                |  |                              | 591,998   |  |                              |  
|Total Long term                       |  | $                            | 591,998   |  |                              | $



| | (1) | Represents the dividends payable
                                         as decreed at the Shareholders' General Meeting held on March 21, 2013 in the amount
                                         of $11,964,960, less payments made in 2013 in the amount of $14,570,467. Also, dividends
                                         payable to shareholders who are in arrears in the payment of quotas generated by the
                                         purchasing of shares in the amount of $3,744, and to whom economic and political rights
                                         have been suspended pursuant to Article 397 of the Code of Commerce. Such payments will
                                         be reinstated once the payments are up to date.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-35







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (17) | Taxes, Contributions and
                                         Duties Payable
| | ---- | --------------------------------------------------------------------------------



Detail of taxes, contributions
and duties payable is comprised as follows:



|                                                            |  | As of December 31, 
    2013 |           |  | As of December 31, 
    2012 |  
|----------------------------------------------------------- |  | ---------------------------- | --------- |  | ---------------------------- | -
|Current                                                     |  |                              |           |  |                              |  
|Income tax                                                  |  | $                            | 7,872,189 |  |                              | $
|Income tax for equality - CREE                              |  |                              | 315,218   |  |                              |  
|National tax on gasoline and gasoline surtax (1)            |  |                              | 224,694   |  |                              |  
|Global tax (1)                                              |  |                              | -         |  |                              |  
|Sales tax payable                                           |  |                              | 24,826    |  |                              |  
|Tax on Equity (2)                                           |  |                              | 567,002   |  |                              |  
|Industry and commerce (Municipal) tax and other minor taxes |  |                              | 67,331    |  |                              |  
|Audit fee                                                   |  |                              | 87,923    |  |                              |  
|Total Current                                               |  | $                            | 9,159,183 |  |                              | $
|Long term:                                                  |  |                              |           |  |                              |  
|Tax on Equity (2)                                           |  |                              | -         |  |                              |  
|Total                                                       |  | $                            | 9,159,183 |  |                              | $



| | (1) | As a result of the enactment
                                         of Act 1607 of 2012, for application the global tax was eliminated from January 2013
                                         the National Tax on Gasoline and Diesel Oil (ACPM) was established.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | The last two installments of
                                         the tax on equity will be paid in 2014.
| | --- | -------------------------------------------------------------------------------------------------------------



The balance of asset and liability
deferred income tax and income tax for equality CREE is as follows:



|                                     |  | December 31, 
    2013 |           |  | December 31, 
    2012* |  
|------------------------------------ |  | ---------------------- | --------- |  | ----------------------- | -
|Assets Deferred tax:                 |  |                        |           |  |                         |  
|Beginning balance                    |  | $                      | 1,557,224 |  |                         | $
|Movement of the year Income and CREE |  |                        | 583,337   |  |                         |  
|Conversion of reporting currency     |  |                        | -         |  |                         |  
|Ending Balance                       |  | $                      | 2,140,561 |  |                         | $
|Liability tax:                       |  |                        |           |  |                         |  
|Beginning balance Income tax         |  |                        | 1,790,546 |  |                         |  
|Movement of the year Income and CREE |  |                        | 411,181   |  |                         |  
|Ending Balance                       |  | $                      | 2,201,727 |  |                         | $



Composition of income tax,
capital gains tax, and income tax for equality - CREE expense as of December 31.



The expense on concept of
income tax, capital gains tax and income tax for equality (CREE) is comprised as follows:



|                                   |  | As of December 31, 
    2013 |           |   | As of December 
    31, 2012* |   |           | As of December
    31, 2011* | 
|---------------------------------- |  | ---------------------------- | --------- | - | ----------------------------- | - | --------- | ---------------------------- | 
|Current income tax - CREE          |  | $                            | 8,283,605 |   |                               | $ | 7,081,647 |                              | 
|Income tax of previous year        |  |                              | 7,966     |   |                               |   | 14,227    |                              | 
|Deferred income tax assets - CREE  |  |                              | 27,661    |   |                               |   | 35,199    |                              | 
|Deferred income tax liability CREE |  |                              | (230,394  | ) |                               |   | 2,322     |                              | 
|Total                              |  | $                            | 8,088,838 |   |                               | $ | 7,133,395 |                              | 



* CREE does not apply for
the years 2012 and 2011.



The effects of temporary differences
that imply the payment of a lower or higher income tax in the current year, are accounted for as a deferred tax asset or liability,
both for the income tax and for the income tax for equality - CREE as applicable, provided there is a reasonable expectation that
such differences will revert, liability in case of the deferred tax assets or sufficient taxable income will be generated to recover
the deferred tax liability.



The determination of the taxable
basis for both income tax and income tax for equality - CREE is the result of the application of the regulations in force in each
case.



F-36







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Income
Tax



Current tax provisions applicable
to Ecopetrol S.A. and subsidiaries establish the following:



| | (a) | As from January 1, 2013, Act
                                         1607 of December 2012 created the income tax for equality-CREE as a contribution from
                                         companies and legal entities and similar income taxpayers on behalf of workers, employment
                                         generation and social investment. The non-profit entities, individuals and companies
                                         declared as free zones with a rate of 15% are not responsible for income tax for equality
                                         - CREE.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | The basis for determining income
                                         tax may net be less than 3% of its net equity on the last day of the immediately preceding
                                         fiscal year.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | As from taxable year 2007,
                                         the inflation adjustments system was eliminated for tax purposes, and the tax on capital
                                         gains was reactivated. Article 109 of Act 1607 of December 2012 established a new tax
                                         rate on occasional these gains for companies and is to be applied as from 2013; such
                                         rate is equivalent to 10%.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Income tax returns can be
reviewed by the tax authorities for up to two years following their filing. For Ecopetrol S.A., the date for 2012 tax return is
open for review.



Income Tax for Equality
(CREE)



Current tax provisions applicable
to Ecopetrol S.A. establish the following:



| | (a) | Act 1607 of December 2012 introduced
                                         the income tax for equality - CREE, effective as from January 1, 2013, as the contribution
                                         of companies, legal persons and assimilated income tax payers in order to benefit workers,
                                         employment generation and investment in social matters. Non-for-profit entities, individuals
                                         and companies classified as free trade zones are subject to the 15% tax rate are not
                                         subject to the income tax for equality - CREE.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | The basis for determining the
                                         income tax for equality - CREE may not be lower than 3% of tax payer’s net equity
                                         on the last day of the immediately preceding taxable period.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | The rate for the income tax
                                         for equality - CREE for 2013, 2014 and 2015 is 9%; as from taxable year 2016, such rate
                                         will be 8%.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (d) | According to Article 25 of Act
                                         1607 of December 2012, effective as from July 1, 2013, legal persons and assimilated
                                         income tax payers, are exempted from paying payroll taxes (National Training Service
                                         - SENA and Colombian Institute for Family Welfare - ICBF). Corresponding to workers individually
                                         earning up to ten (10) minimum monthly salaries in force. This exemption does not apply
                                         to taxpayers not subject to the income tax for equality - CREE.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (e) | The taxable basis of the income
                                         tax for equality - CREE will be established by subtracting returns, rebates and discounts
                                         from the gross income that may have increased equity during the taxable year and subsequently
                                         subtracting from the resulting amount the values corresponding to revenues not considered
                                         taxable income as defined in the Tax Code. From the net income so obtained, the total
                                         costs and deductions applicable to this tax will be deducted, in accordance with the
                                         provisions of Articles 107 and 108 of the Tax Code. Exempt income, as expressly determined
                                         by Article 22 of Act 1607 of 2012, will then be allowed to be deducted from that amount.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Tax on Equity



For taxable year 2011, the
equity tax was established for income taxpayers under Act 1370 of 2009. Therefore, taxpayers owning net equity exceeding $5,000
million should pay a 4.8% rate, and those owning net equity between $3,000 million and $5,000 million should pay a 2.4% rate on
such equity.



A new rate for taxpayers required
to pay such tax was included by means of Emergency Decree Number 4825 of December 2010. Such rates are: 1% for net equity between
$1,000 and $2,000 million, and 1.4% for equity between $2,000 and $3,000 million.



In addition, a surcharge of
25% was established by such Decree on this tax, which is only applicable to equity taxpayers under Act 1370 of 2009.



Based on the above, and in
accordance with accounting management decrees, Ecopetrol recognized the value of the equity tax payable, and the corresponding
charge to income, for the proportional value corresponding to 2011, 2012 and 2013. The pending balance payable was registered
as a deferred asset amortizable during 2014.



F-37







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Transfer Pricing



Since 2004, income taxpayers
who had entered into transactions with related parties abroad, and/or with residents of countries considered to be tax havens,
are under the obligation of determining, for income tax purposes, their ordinary and extraordinary income, costs and deductions,
and assets and liabilities, taking into account the denominated market prices and profit margins for these transactions (Arm’s
length principles). Based on the opinion of the Company’s advisor, no significant changes are expected for taxable year
2013 related to the compliance with the principle of full jurisdiction set out in Article 260-1 of the Colombian Tax Code, and
there are no foreseen adjustments to the determination of income tax expenses for the said year.



To
date, Ecopetrol has not completed the 2013 study; however, based on the results from the 2012 study, no adjustments to the income
tax provision derived from the 2013 price analysis, affecting the results of the period, are required.



| | (18) | Labor and Pension Liabilities
| | ---- | -----------------------------



The balance of labor
and pension liabilities is comprised as follows:



|                                                 |  | As of December 31, 
    2013 |           |  | As of December 31,
    2012 |  
|------------------------------------------------ |  | ---------------------------- | --------- |  | --------------------------- | -
|Current:                                         |  |                              |           |  |                             |  
|Leave                                            |  | $                            | 101,241   |  |                             | $
|Premiums, bonuses and allowances                 |  |                              | 91,489    |  |                             |  
|Severance payments                               |  |                              | 52,739    |  |                             |  
|Salaries and pensions payable                    |  |                              | 5,774     |  |                             |  
|Interests on severance                           |  |                              | 5,961     |  |                             |  
|Other                                            |  |                              | 32,424    |  |                             |  
|Total short term                                 |  | $                            | 289,628   |  |                             | $
|Long term                                        |  |                              |           |  |                             |  
|Actuarial liability for health and education (1) |  |                              | 4,211,288 |  |                             |  
|Retirement pensions, joint ventures              |  |                              | 66,543    |  |                             |  
|Other                                            |  |                              | -         |  |                             |  
|Total Long term                                  |  | $                            | 4,277,831 |  |                             | $
|Total                                            |  | $                            | 4,567,459 |  |                             | $



| | (1) | The actuarial computations
                                         for health and education for Ecopetrol S.A. were prepared by applying the mortality
                                         tables updated in 2010 and using a technical interest rate of 4.8%. The value of future
                                         health and education payments, was estimated by applying an increase of 5.922% (2012
                                         - 4.755%), which correspond to the average inflation rate registered by the National
                                         Administrative Department of Statistics (from the Spanish Departamento Administrativo
                                         Nacional de Estadística - DANE) during the last three years, to the
                                         year calculation, plus an additional 1.5%, taking into account the Company ́s real
                                         growth. As a result of the 2010 change in the accounting principle for amortization,
                                         the portion pending to be amortized is 6% at the closing of 2013 which is equivalent
                                         to $227,416.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The amortized actuarial liability
for health is as follows:



|Concept                                               |  | December 31, 
    2013 |           |   | December 31, 
    2012 |  
|----------------------------------------------------- |  | ---------------------- | --------- | - | ---------------------- | -
|Actuarial calculation of health liabilities           |  | $                      | 4,053,865 |   |                        | $
|Less - Actuarial calculation
    pending amortization |  |                        | (227,416  | ) |                        |  
|Amortized actuarial liability                         |  | $                      | 3,826,449 |   |                        | $



The difference in amortized
actuarial liability is as follows:



|                 |  | December 31, 
    2013 |           |  | December 31, 
    2012 |   |           | Difference | 
|---------------- |  | ---------------------- | --------- |  | ---------------------- | - | --------- | ---------- | 
|Health:          |  |                        |           |  |                        |   |           |            | 
|Active personnel |  | $                      | 518,089   |  |                        | $ | 401,883   |            | 
|Retirees         |  |                        | 3,308,360 |  |                        |   | 3,205,467 |            | 
|Education:       |  |                        |           |  |                        |   |           |            | 
|Active personnel |  |                        | 48,081    |  |                        |   | 37,736    |            | 
|Retirees         |  |                        | 336,758   |  |                        |   | 347,743   |            | 
|Total            |  | $                      | 4,211,288 |  |                        | $ | 3,992,829 |            | 



F-38







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (19) | Estimated Liabilities
                                         and Provisions
| | ---- | -----------------------------------------------------------------------------



The balance of estimated
liabilities and provisions is comprised as follows:



|                                                                                     |  | As of December 
    31, 2013 |           |  | As of December
    31, 2012 |  
|------------------------------------------------------------------------------------ |  | ---------------------------- | --------- |  | --------------------------- | -
|Current:                                                                             |  |                              |           |  |                             |  
|Provision for legal proceedings (1) (see Note 31)                                    |  | $                            | 524,937   |  |                             | $
|Provision for pension obligations                                                    |  |                              | 500       |  |                             |  
|Provision for abandonment, facility dismantling and environmental recovery costs (2) |  |                              | 109,55757 |  |                             |  
|Other provisions (3)                                                                 |  |                              | 953,893   |  |                             |  
|Provisions for contingencies (4)                                                     |  |                              | 926,118   |  |                             |  
|Total current                                                                        |  | $                            | 2,515,005 |  |                             | $
|Long term:                                                                           |  |                              |           |  |                             |  
|Provision for abandonment, facility dismantling and environmental recovery costs (2) |  | $                            | 4,636,968 |  |                             | $
|Provision for community members (5)                                                  |  |                              | 445,364   |  |                             |  
|Provision for legal proceedings (1)                                                  |  |                              | 16,910    |  |                             |  
|Other provisions                                                                     |  |                              | 64,577    |  |                             |  
|Total Long term                                                                      |  | $                            | 5,163,819 |  |                             | $
|Total                                                                                |  | $                            | 7,678,824 |  |                             | $



| | (1) | The movement in the provision
                                         for legal proceedings as of December 31, 2013 is comprised as follows:
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------



|                                 |  | Number of 
    Proceedings |      |   | Provision Amounts |  
|-------------------------------- |  | -------------------------- | ---- | - | ----------------- | -
|Opening balance                  |  | $                          | 703  |   |                   | $
|Additions (new provisions)       |  |                            | 282  |   |                   |  
|Adjustment to existing provision |  |                            | (617 | ) |                   |  
|Closing balance                  |  | $                          | 368  |   |                   | $



The movement in the provision
for legal proceedings as of December 31, 2012 is as follows:



|                                      |  | Number of 
    Proceedings |      |   | Provision 
    Amounts |  
|------------------------------------- |  | -------------------------- | ---- | - | ---------------------- | -
|Opening balance                       |  | $                          | 784  |   |                        | $
|Additions (new provisions)            |  |                            | 313  |   |                        |  
|Adjustment to existing provision      |  |                            | (410 | ) |                        |  
|Recovery from transfer of proceedings |  |                            | (5   | ) |                        |  
|Closing balance                       |  | $                          | 682  |   |                        | $



| | (2) | The following shows the movements
                                         in the provisions for short term abandonment, facility dismantling and environmental
                                         recovery costs:
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                                       |  | December 31, 
    2013 |           |   | December 31, 
    2012 |  
|-------------------------------------- |  | ---------------------- | --------- | - | ---------------------- | -
|Opening balance                        |  | $                      | 3,946,560 |   |                        | $
|Additions – (Decrease)                 |  |                        | 1,016,762 |   |                        |  
|Withdrawals and use                    |  |                        | (232,813  | ) |                        |  
|Conversion into the reporting currency |  |                        | 16,016    |   |                        |  
|Closing balance                        |  | $                      | 4,746,525 |   |                        | $



Most of the abandonment allowances
were accrued mainly by Ecopetrol S.A., in the amount of $4,559,662 (2012- $3,804,199).



| | (3) | Mainly
                                         includes provisions created for the purpose of anticipating potential nature-related
                                         and other events that could affect transportation facilities and have an impact on the
                                         regions where there is a presence. Starting January 2012, three large-scale projects
                                         were created: the Dosquebradas Project, the Integrity Program and the Contingency Program.
                                         Additionally, includes provisions in subsidiaries mainly such as: Refinería de
                                         Cartagena in the amount of $397,378 for goods and services; Equión in the amount
                                         of $116,313 for partnership agreements; Oleoducto Bicentenario in the amount of $47,415;
                                         Ocensa in the amount of $48,399; Hocol in the amount of $43,384; Ecopetrol America Inc.
                                         in the amount of $16,885; and Propilco in the amount of $4,411.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-39







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (4) | This is represented mainly
                                         by provisions in Ecopetrol such as: (i) $804,358 to comply with the payment of pension
                                         liability (Note 21 No 3.). (ii) $28,364 for potential PDVSA claims for payment of work
                                         to clean up and decontaminate Lake Maracaibo in Venezuela, (iii) $86,101 for situations
                                         with environmental implications and (iv) $156 corresponding to the success-based fees
                                         for the representative in the litigation against Ecopetrol S.A. initiated by Industrias
                                         Crizasa.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (5) | Includes the interim relief
                                         ordered by the Council of State in its decree of June 24, 1994 in the invalidity action
                                         brought by the Ministry of Mines and Energy against Comuneros (community members) of
                                         Santiago de las Atalayas and Pueblo Viejo de Cusiana, corresponding to the attachment
                                         and seizure of the payments to be made by Ecopetrol for royalties, based on Royalty contracts
                                         No. 15, 15A, 16 and 16A, declared null and void by the Council of State in its ruling
                                         of September 13, 1999, in which it was ordered that such interim relief should be cancelled
                                         and that the attached and seized amounts should be handed over to the State - the Ministry
                                         of Mines. Ecopetrol has capacity as receiver. Of said amount, $90,752 corresponds to
                                         the value initially recognized by Ecopetrol, as well as the valuation of the fund containing
                                         theresources; $357,903 corresponds to generated
                                         interest. In a ruling on December 12, 2012, notified by edict on January 21, 2013, the
                                         Council of State declared that the special plea for reconsideration filed by the Comuneros
                                         was dismissed.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (20) | Other Long-term Liabilities
| | ---- | ---------------------------



The balance of other
long-term liabilities is comprised as follows:



|                                         |  | As of December 31, 
    2013 |           |  | As of December 31, 
    2012 |  
|---------------------------------------- |  | ---------------------------- | --------- |  | ---------------------------- | -
|Credit deferred income tax               |  | $                            | 2,177,409 |  |                              | $
|Advances received from Ecogas for BOMT’s |  |                              | 335,550   |  |                              |  
|Credit for deferred monetary correction  |  |                              | -         |  |                              |  
|Other liabilities                        |  |                              | 461,817   |  |                              |  
|Total                                    |  | $                            | 2,974,776 |  |                              | $



| | (21) | Non-controlling interest
| | ---- | ------------------------



The balance non-controlling
interest is comprised as follows:



|                              |  | As of December 31, 
    2013 |           |  | As of December 31, 
    2012 |  
|----------------------------- |  | ---------------------------- | --------- |  | ---------------------------- | -
|Bioenergy S.A.                |  | $                            | 19,403    |  |                              | $
|ODL Finance S.A.              |  |                              | 377,245   |  |                              |  
|Ocensa S.A.                   |  |                              | 2,187,766 |  |                              |  
|Oleoducto de Colombia S.A.    |  |                              | 299,851   |  |                              |  
|Oleoducto Bicentenario S.A.S. |  |                              | 312,515   |  |                              |  
|Equion Energia Ltd.           |  |                              | 1,376,968 |  |                              |  
|Total                         |  | $                            | 4,573,748 |  |                              | $



| | (22) | Shareholders' Equity
| | ---- | --------------------



Subscribed and Paid-in
Capital



Ecopetrol’s authorized
capital amounts to $15,000,000, and is comprised by 60,000,000,000 ordinary nominative shares at a $250 pesos par value each.
41,116,698,456 of such shares have been subscribed represented by 11.51% of non-controlling interest and 88.49% held of shareholders
from Government entities. The value of the reserve shares amounts to $4,720,825 comprised by 18,883,301,544 shares.



F-40







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Additional Paid-in Capital



Mainly corresponds to: (i)
the surplus with regards to its par value derived from the sale of shares upon capitalization in 2007 in the amount of $4,700,963;
(ii) $31,225 corresponding to the value generated by placing shares on the secondary market, arising from the execution of guarantees
from debtors in arrears in accordance with the stipulations of Article 397 of theCode of
Commerce; and (iii) to the surplus over the par value arising from the sale of shares awarded in the second round, which took
place in September 2011, in the amount of $2,222,443.



|                                      |  | December 31, 2013 |           |   | December 31, 2012 |  
|------------------------------------- |  | ----------------- | --------- | - | ----------------- | -
|Additional paid-in capital shares     |  | $                 | 6,954,631 |   |                   | $
|Additional paid-in capital receivable |  |                   | (257      | ) |                   |  
|Total                                 |  | $                 | 6,954,374 |   |                   | $



Effect of Applying the
Government Accounting Regime-RCP (from the Spanish Régimen de Contabilidad Pública)



Corresponds to the transfer
of negative balances derived from devaluations of property, plant and equipment, as established by the Public Accounting Regime
as from 2008.



This heading also shows the
responsibilities pending decision arising from proceedings on loss of materials, through enforcement of the process established
in the above-mentioned standard.



Equity Reserves



The legal reserve is made
up of 10% of net income and can be used to offset losses or to distribute in the event of liquidating the Company.



On March 21, 2013, the results
for 2012 were considered by the General Assembly of Shareholders, at which it was decided not to increase the legal reserve since
it currently represents 50% of the subscribed capital.



Increases were approved in
the reserves for compliance with Regulatory Decree 2336 of 1995 (reappraisal at market prices) for $215,406. From such amount,
the reserves accumulated as of December 31, 2012 in the amount of $1,829,362 were also released; and the reserves for executing
investment projects in the amount of $2,628,877 were increased, as well as $1,260,000 for performing infill drilling campaigns;
and $1,338,204 for unrealized profits of the Business Group. Additionally, reserves in the amount of $605,135 were released to
strengthen transportation infrastructure.



The detail of reserves is
comprised as follows:



|                                            |  | As of December 31, 
    2013 |            |  | As of December 31, 
    2012 |  
|------------------------------------------- |  | ---------------------------- | ---------- |  | ---------------------------- | -
|Legal                                       |  | $                            | 5,139,587  |  |                              | $
|Occasional reserves for investment programs |  |                              | 9,945,733  |  |                              |  
|Regulatory Decree 2336 of 1995              |  |                              | 215,406    |  |                              |  
|Total                                       |  | $                            | 15,300,726 |  |                              | $



Incorporated Institutional
Equity



Corresponds to the product
of commercial activity mainly linked to the following associates contracts: Nare; Matambo; Garcero; Corocora; Estero; Caracara,
for the Sardinas 6, Remache Norte 3, Abejas 3, Jaguar T5 and T6 wells, Orocué; the Guarilaque 7 well; Campo Rico for the
Candalay, Jordán 5, Remache Norte 2 and 5, Abejas 2 and Vigia wells, and the incorporation of the Cocorná materials
warehouse.



F-41







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (23) | Memorandum Accounts
| | ---- | -------------------



The detail of memorandum
accounts is comprised as follows:



|                                                              |  | As of December 31, 
    2013 |             |  | As of December 31, 
    2012 |  
|------------------------------------------------------------- |  | ---------------------------- | ----------- |  | ---------------------------- | -
|Debtor                                                        |  |                              |             |  |                              |  
|Exploitation rights - Decree 727 of 2007 (1)                  |  | $                            | 61,016,768  |  |                              | $
|Other contingent rights and debtor accounts (2)               |  |                              | 42,656,068  |  |                              |  
|(Deductible and non-deductible) costs and expenses            |  |                              | 34,836,502  |  |                              |  
|Pension-related autonomous equity (3)                         |  |                              | 11,449,876  |  |                              |  
|Securities given in custody and guarantee                     |  |                              | 1,447,325   |  |                              |  
|Implementation of investment projects                         |  |                              | 21,953      |  |                              |  
|Legal proceedings                                             |  |                              | 782,209     |  |                              |  
|Total                                                         |  | $                            | 152,210,701 |  |                              | $
|Creditor                                                      |  |                              |             |  |                              |  
|Legal proceedings                                             |  | $                            | 28,804,122  |  |                              | $
|Goods received in custody (4)                                 |  |                              | 20,455,350  |  |                              |  
|Contractual guarantees (5)                                    |  |                              | 17,434,639  |  |                              |  
|Pension-related autonomous equity (7)                         |  |                              | 12,254,234  |  |                              |  
|Non-tax liabilities                                           |  |                              | 11,421,071  |  |                              |  
|Other contingent liabilities (6)                              |  |                              | 9,680,448   |  |                              |  
|Potential liabilities - pension liabilities (7)               |  |                              | 405,769     |  |                              |  
|Non-taxed income                                              |  |                              | 5,567,612   |  |                              |  
|Mandate agreements (8)                                        |  |                              | 1,279,886   |  |                              |  
|Administration funds - Decrees 1939 of 2001, and 2652 of 2012 |  |                              | 1,033,557   |  |                              |  
|Future BOMT payments                                          |  |                              | 170,028     |  |                              |  
|Work Contracts                                                |  |                              | 3,267,904   |  |                              |  
|Total                                                         |  | $                            | 111,774,620 |  |                              | $
|                                                              |  | $                            | 263,985,321 |  |                              | $



| | (1) | Reserves
                                         valued as of December 31, 2013 based on the volumes in the audited reserves study and
                                         applying the average price set by SEC-approved regulations. On March 7, 2007, Decree
                                         727 was issued, featuring the regulations for valuating reserves and accounting for the
                                         Nation's hydrocarbon reserves in the Company's financial statements. The decree also
                                         establishes that the value of hydrocarbon exploration and production rights it owns must
                                         recorded. Said value is recorded under memorandum accounts in accordance with the opinion
                                         provided by the National Accounts Office (CGN); however, the memorandum accounts are
                                         not part of the Company ́s balance sheet.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | The balance corresponds mainly
                                         to the following: (i) the balance of tax memorandum accounts in the amount of $30,224,255,
                                         which reflect the differences between the values of both equity and income statement
                                         accounts taken from the 2012 tax return, and the accounting balances. The differences
                                         are derived from concepts such as valuations, allowances not accepted for tax purposes,
                                         the difference in the amortization method for oil investments, which is done by using
                                         the units of production method for accounting purposes, and by using the straight-line
                                         method for tax purposes, and the effect of the adjustment for inflation, amongst other;
                                         and (ii) securities in custody in the amount of $5,308,492.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | Reflects
                                         the contingent right (debtor account) on resources placed in the pension-related autonomous
                                         trust, to pay transferred pension liabilities, in order to control the existence of liquid
                                         resources in the autonomous equity fund. The value transferred as of December 31, 2013
                                         in the amount of $11,449,876 ($10,092,528, on the date of transfer, December 31, 2008),
                                         corresponds to the pension liability for monthly pension payments, shares and pension
                                         bonds; the amounts tied to health and education are within Ecopetrol’s pension
                                         liability. The transferred resources, and their yields, cannot change destination or
                                         be returned to the Company until all pension liabilities have been fulfilled.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The detail of pension-related
autonomous pension trust funds is comprised as follows:



|                                     |  | As of December 31, 
    2013 |            |  | As of December 31, 
    2012 |  
|------------------------------------ |  | ---------------------------- | ---------- |  | ---------------------------- | -
|Consorcio Ecopensiones 2011          |  | $                            | 3,007,450  |  |                              | $
|Porvenir S.A.                        |  |                              | 2,525,046  |  |                              |  
|Consorcio Pensiones Ecopetrol 2011   |  |                              | 2,058,602  |  |                              |  
|Unión temporal Skandia-HSBC          |  |                              | 1,813,095  |  |                              |  
|Consorcio Bogotá-Colpatria-Occidente |  |                              | 2,045,683  |  |                              |  
|Total                                |  | $                            | 11,449,876 |  |                              | $



F-42







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (4) | Includes,
                                         the value of royalties corresponding to the balance of Ecopetrol reserves, in the amount
                                         of $19,740,624 (2012 - $27,222,901), calculated according to SEC-approved regulations.
                                         This heading also includes the inventories of products sold and materials pending delivery
                                         to clients in the amount of $43,453 (2012 - $37,203); goods received in concession custody:
                                         Coveñas in the amount of $41,660; Pozos Colorados in the amount of $21,058; and
                                         Tumaco in the amount of $6,083 (2012 - $41,660; $21,058 and $6,053, respectively) and
                                         investments of Black Gold administered by Ecopetrol for $193,658.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (5) | Includes contracts pending
                                         for execution, in pesos, dollars and euros, updated at the TRM as of December 31, 2013
                                         in the amount of $12,917,756 and standby letters of credit guaranteeing contracts signed
                                         by Ecopetrol S.A. in the amount of $1,084,975.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The financial closing for awarding
two contingent guarantees to Refinería de Cartagena S.A. - Reficar by Ecopetrol was carried out on December 30, 2011. Such
guarantees are part of the financial support granted by a group of Export Credit Agencies and by commercial banks for the project
of expansion and modernization of Reficar. The financing structure is of the Finance Project type with a maximum repayment term
of 14 years, counted as of the six months following the date of the project completion. For the project financing purposes, Ecopetrol
granted to Reficar: i) contingent guarantee for the resources necessary to complete the project (US$1,447 million equivalent to
$2,788,123 million at the TRM of December 31, 2013); and ii) a contingent guarantee for the payment of eventual amounts that could
be needed by Reficar for the debt service between December 2013 and December 2014 (US$249 million equivalent to $479,781 million
at the TRM effective at December 31, 2013).



| | (6) | Equión has two lending-rate stand-by letters of
credit, which total US$4,583,280, and seek to guarantee, to the ANH, the fulfillment and execution of contracts No. 32 and 33
of the Ronda Caribe Sector, for the RC-4 and RC-5 Blocks.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Issuing entity: Helm Bank S.A.



|LetterNo. |  | Beneficiary                       |  | Purpose                                                                               |  | StartingDate      |  | CompletionDate    |  | Amount
    inUSD |           |  | Amount
    in COP |  
|--------- |  | --------------------------------- |  | ------------------------------------------------------------------------------------- |  | ----------------- |  | ----------------- |  | ---------------- | --------- |  | ----------------- | -
|T000127   |  | Agencia Nacional de Hidrocarburos |  | To ensure compliance with Contract
    No. 32 of Ronda Caribe Sector -for RC-4 Block. |  | November 28, 2010 |  | February 28, 2014 |  | $                | 2,230,800 |  |                   | $
|T000126   |  | Agencia Nacional de Hidrocarburos |  | To ensure compliance with Contract No. 33 of
    Ronda Caribe Sector -for RC-5 Block. |  | November 28, 2010 |  | February 28, 2014 |  | $                | 2,352,480 |  |                   | $



The risk of these guarantees
being disbursed remains low.



| | (7) | Made up of the value of the
                                         actuarial calculation of monthly pension payments, shares and bonds as of December 31,
                                         2013 plus the percentage of amortization of the 2010 reserve that arose from the change
                                         in the accounting principle for amortization. As of December 31, 2013 the amortizable
                                         reserve was 4%, equivalent to $405,769.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The balance of the amortized
actuarial liability is comprised as follows:



|                                                                                          |  | As of December 
    31, 2013 |            |   | As of December 
    31, 2012 |  
|----------------------------------------------------------------------------------------- |  | ---------------------------- | ---------- | - | ---------------------------- | -
|Concept                                                                                   |  |                              |            |   |                              |  
|Actuarial calculation of the liability for monthly pension payments and pension
    bonds |  | $                            | 12,660,003 |   |                              | $
|Less - Actuarial
    calculation pending amortization                                     |  |                              | (405,769   | ) |                              |  
|Amortized actuarial liability                                                             |  | $                            | 12,254,234 |   |                              | $



The balance of pension - Related
autonomous funds, the value of the actuarial reserve, and the amortized value of the pension liability for monthly payments are
included in memorandum accounts.



The actuarial calculation was
carried out by using a technical interest rate of 4%. The increase in salaries, pensions in cash and pensions in kind was calculated
by using theaverage inflation rate as determined by the National Statistics Administration
Department (from the Spanish Departamento Administrativo Nacional de Estadística - DANE), during the three years
immediately preceding the calculation year.



As of December 31, 2013, 13,106
people were covered in the actuarial calculation, and 13,885 were covered in pension bonds.



| | (8) | Includes the value of assets
                                         received in custody from Refinería de Cartagena S.A. in fulfillment of obligations
                                         acquired under the mandate contract signed between Ecopetrol and that Company to operate
                                         the refinery, namely: product inventories in the amount of $358,351 (2012 - $429,108);
                                         and property, plant and equipment in the amount of $921,355 (2012 - $957,197).
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-43







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (24) | Revenues
| | ---- | --------



The balance of revenues
for the years ended December is as follows:



|                                      |  | 2013 |            |  | 2012 |   |            | 2011 | 
|------------------------------------- |  | ---- | ---------- |  | ---- | - | ---------- | ---- | 
|National sales                        |  |      |            |  |      |   |            |      | 
|Mid-distillates                       |  | $    | 11,582,902 |  |      | $ | 11,132,983 |      | 
|Gasoline                              |  |      | 5,968,084  |  |      |   | 5,697,178  |      | 
|Services                              |  |      | 2,535,867  |  |      |   | 2,077,858  |      | 
|Other products                        |  |      | 1,738,288  |  |      |   | 2,100,780  |      | 
|Crude                                 |  |      | 1,421,620  |  |      |   | 572,969    |      | 
|Natural gas                           |  |      | 1,255,092  |  |      |   | 1,108,164  |      | 
|Asphalts                              |  |      | 392,010    |  |      |   | 369,768    |      | 
|L.P.G. and propane                    |  |      | 375,358    |  |      |   | 492,440    |      | 
|                                      |  | $    | 25,269,221 |  |      | $ | 23,552,140 |      | 
|Recognition of price differential (1) |  |      | 938,678    |  |      |   | 809,773    |      | 
|                                      |  | $    | 26,207,899 |  |      |   | 24,361,913 |      | 
|Foreign sales                         |  |      |            |  |      |   |            |      | 
|Crude                                 |  | $    | 35,726,701 |  |      | $ | 35,884,535 |      | 
|Fuel oil                              |  |      | 4,463,237  |  |      |   | 4,283,814  |      | 
|Plastic and rubber                    |  |      | 857,397    |  |      |   | -          |      | 
|Natural Gas                           |  |      | 586,687    |  |      |   | 563,412    |      | 
|Propylene                             |  |      | 272        |  |      |   | -          |      | 
|Agricultural products                 |  |      | -          |  |      |   | -          |      | 
|Gasoline and turbo fuel               |  |      | 789,071    |  |      |   | 1,182,367  |      | 
|Diesel                                |  |      | 1,195,704  |  |      |   | 1,223,159  |      | 
|Other products                        |  |      | 601,746    |  |      |   | 1,352,802  |      | 
|                                      |  | $    | 44,220,815 |  |      | $ | 44,490,089 |      | 
|                                      |  | $    | 70,428,714 |  |      | $ | 68,852,002 |      | 



| | (1) | Corresponds to the application
                                         of Decree 4839 of December 2008, which defined the procedure for price differentials
                                         (value generated by the difference between parity price and regulated price which can
                                         be positive or negative).
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-44







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (25) | Cost of Sales
| | ---- | -------------



The balance of cost
of sales for the years ended December 31, is as follows:



|                                                                           |  | 2013 |            |   | 2012 |   |            | 2011 | 
|-------------------------------------------------------------------------- |  | ---- | ---------- | - | ---- | - | ---------- | ---- | 
|Variable cost:                                                             |  |      |            |   |      |   |            |      | 
|Services contracted in association                                         |  | $    | 603,011    |   |      | $ | 512,138    |      | 
|Hydrocarbon purchases - ANH (1)                                            |  |      | 7,808,844  |   |      |   | 8,646,762  |      | 
|Imported products (2)                                                      |  |      | 11,862,265 |   |      |   | 9,447,041  |      | 
|Purchase of crude in association and concession contracts                  |  |      | 5,805,854  |   |      |   | 7,207,707  |      | 
|Amortization and depletion                                                 |  |      | 3,202,007  |   |      |   | 3,000,758  |      | 
|Hydrocarbon transportation services                                        |  |      | 1,610,287  |   |      |   | 1,106,649  |      | 
|Purchases of other products and gas                                        |  |      | 598,035    |   |      |   | 618,715    |      | 
|Electric Power                                                             |  |      | 308,927    |   |      |   | 306,942    |      | 
|Processing materials                                                       |  |      | 310,657    |   |      |   | 276,550    |      | 
|Volume adjustments and other allocations                                   |  |      | (72,837    | ) |      |   | (296,434   | )    | 
|Depreciation by production units                                           |  |      | 94,760     |   |      |   | 105,805    |      | 
|                                                                           |  | $    | 32,131,810 |   |      | $ | 30,932,633 |      | 
|Fixed costs:                                                               |  |      |            |   |      |   |            |      | 
|Services contracted in association                                         |  | $    | 1,691,656  |   |      | $ | 1,519,143  |      | 
|Maintenance                                                                |  |      | 2,240,543  |   |      |   | 1,921,008  |      | 
|Labor costs                                                                |  |      | 1,260,436  |   |      |   | 1,095,495  |      | 
|Depreciation                                                               |  |      | 1,828,228  |   |      |   | 1,886,620  |      | 
|Contracted services                                                        |  |      | 1,356,452  |   |      |   | 1,127,284  |      | 
|Non capitalized project costs                                              |  |      | 469,926    |   |      |   | 561,416    |      | 
|Operating materials and supplies                                           |  |      | 364,554    |   |      |   | 388,673    |      | 
|Tax and contributions                                                      |  |      | 625,272    |   |      |   | 401,576    |      | 
|Amortization of deferred charges, intangible assets and insurance policies |  |      | 27,727     |   |      |   | 171,902    |      | 
|General costs                                                              |  |      | 450,922    |   |      |   | 402,672    |      | 
|Hydrocarbon transportation services                                        |  |      | 2,257      |   |      |   | -          |      | 
|Amortization of the actuarial calculation for health
    and education     |  |      | 104,499    |   |      |   | 127,086    |      | 
|                                                                           |  | $    | 10,422,472 |   |      | $ | 9,602,875  |      | 
|                                                                           |  | $    | 42,554,282 |   |      | $ | 40,535,508 |      | 



| | (1) | Corresponds to Ecopetrol’s
                                         crude oil and gas purchases from the ANH derived from domestic production, both by the
                                         Company in direct operations and by third parties.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | Corresponds mainly to Ecopetrol
                                         S.A. in the amount of $8,882,280 for the importation of very low-sulphur diesel, to improve
                                         the quality of local products and diluting agents to help transport heavy crude. It also
                                         includes purchases from Reficar in the amount of $2,008,101 (imported Acem, Gasoline
                                         Ron 95, Gasoline Ron 92 and Diesel); Propilco in the amount of $945,463 and Comai in
                                         the amount of $26,421 (titanium dioxide and polyethylene).
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-45







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (26) | Operating Expenses
| | ---- | ------------------



The balance of operating
expenses for the years ended December 31 is as follows:



|                                                                   |  | 2013 |           |   | 2012 |   |           | 2011 | 
|------------------------------------------------------------------ |  | ---- | --------- | - | ---- | - | --------- | ---- | 
|Administration                                                     |  |      |           |   |      |   |           |      | 
|Amortizations (1)                                                  |  | $    | 344,868   |   |      | $ | 313,344   |      | 
|Labor expenses                                                     |  |      | 412,586   |   |      |   | 321,643   |      | 
|General expenses                                                   |  |      | 221,666   |   |      |   | 172,735   |      | 
|Depreciation                                                       |  |      | 35,169    |   |      |   | 35,233    |      | 
|Rentals and leases                                                 |  |      | 16,025    |   |      |   | 12,441    |      | 
|Amortization of the actuarial calculation for health and education |  |      | 1,770     |   |      |   | 8,896     |      | 
|Maintenance                                                        |  |      | 6,794     |   |      |   | 5,756     |      | 
|Taxes                                                              |  |      | 63,827    |   |      |   | 4,932     |      | 
|Loss in goodwill withdrawal                                        |  |      | 353,012   |   |      |   | -         |      | 
|                                                                   |  | $    | 1,455,717 |   |      | $ | 874,980   |      | 
|Operation and projects                                             |  |      |           |   |      |   |           |      | 
|Project expenses (2)                                               |  | $    | 183,784   |   |      | $ | 237,280   |      | 
|Exploration expenses (3)                                           |  |      | 1,355,007 |   |      |   | 1,419,530 |      | 
|General expenses                                                   |  |      | 921,949   |   |      |   | 678,022   |      | 
|Labor expenses                                                     |  |      | 231,454   |   |      |   | 277,430   |      | 
|Taxes                                                              |  |      | 924,620   |   |      |   | 957,407   |      | 
|Transportation via gas pipeline                                    |  |      | 17,287    |   |      |   | 136,573   |      | 
|Maintenance                                                        |  |      | 8,485     |   |      |   | 19,018    |      | 
|Gas supply default                                                 |  |      | (29       | ) |      |   | 764       |      | 
|Provisions and provisions recovery (4)                             |  |      | 650,660   |   |      |   | 318,629   |      | 
|Amortizations                                                      |  |      | -         |   |      |   | 6         |      | 
|Previous periods, net (5)                                          |  |      | 50,189    |   |      |   | (124,167  | )    | 
|Audit installment                                                  |  |      | 95,062    |   |      |   | 55,786    |      | 
|Loss of fuel                                                       |  |      | 100,857   |   |      |   | 83,039    |      | 
|Contributions and donations                                        |  |      | 44,661    |   |      |   | 39,293    |      | 
|                                                                   |  | $    | 4,583,986 |   |      | $ | 4,098,610 |      | 
|                                                                   |  | $    | 6,039,703 |   |      | $ | 4,973,590 |      | 



| | (1) | During 2013 at Ecopetrol S.A.
                                         the amount of $282,400 (2012 - $291,884), was amortized corresponding mainly to the goodwill
                                         of the following companies: Propilco, Ocensa, Hocol, Andean, Offshore International Group
                                         and Equión; and Reficar in the amount of $43,670 and Equion in the amount of $10,554
                                         for software licenses amortization.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | Project expenses corresponds
                                         mainly to the consulting of acquisition projects with the Colombian Institute of Petroleum
                                         Directorate - Effectiveness Unit in Ecopetrol in the amount of $85,835; administration
                                         of projects in the Administrative Shared Services Center and the Colombian Institute
                                         of Petroleum Management in the amount of $43,283.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | Exploration expenses during
                                         2013 correspond to feasibility studies in the amount of $95,853; G&G studies in the
                                         amount of $12,198; non-capitalized items for projects in the amount of $199,409; dry
                                         wells by $27,704; and seismic studies in the amount of $201,193 (offshore $57,654).
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-46







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (4) | The detail of operation provisions
                                         for the years ended December 31 is as follows:
| | --- | --------------------------------------------------------------------------------------------------------------------------



|                                           |  | 2013 |           |  | 2012 |   |           | 2011 | 
|------------------------------------------ |  | ---- | --------- |  | ---- | - | --------- | ---- | 
|Operation Provisions                       |  |      |           |  |      |   |           |      | 
|Property, plant and equipment              |  | $    | 122,514   |  |      | $ | 315,627   |      | 
|Investment portfolio                       |  |      | 31,681    |  |      |   | 87,186    |      | 
|Inventory of products and materials        |  |      | 18,703    |  |      |   | 14,459    |      | 
|Legal proceedings                          |  |      | 113,194   |  |      |   | 593,028   |      | 
|Transfer of pension liabilities and others |  |      | 833,248   |  |      |   | 23,087    |      | 
|                                           |  | $    | 1,119,340 |  |      | $ | 1,033,387 |      | 
|Recovery of operation provisions           |  |      |           |  |      |   |           |      | 
|Property, plant and equipment              |  | $    | 67,999    |  |      | $ | 171,102   |      | 
|Inventory of products and materials        |  |      | 5,254     |  |      |   | 11,966    |      | 
|Investment portfolio                       |  |      | 2,717     |  |      |   | 225       |      | 
|Legal proceedings                          |  |      | 307,493   |  |      |   | 259,450   |      | 
|Other                                      |  |      | 85,217    |  |      |   | 272,015   |      | 
|                                           |  | $    | 468,680   |  |      | $ | 714,758   |      | 
|Net                                        |  | $    | 650,660   |  |      | $ | 318,629   |      | 



| | (5) | The detail
                                         of income and expenses from previous years, net for the years ended December 31, is as
                                         follows:
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                                  |  | 2013 |         |   | 2012 |   |          | 2011 | 
|--------------------------------- |  | ---- | ------- | - | ---- | - | -------- | ---- | 
|Income previous years:            |  |      |         |   |      |   |          |      | 
|Other                             |  | $    | (10,646 | ) |      | $ | 77,596   |      | 
|Fixed assets                      |  |      | 7,708   |   |      |   | 2,785    |      | 
|Expenses recovery                 |  |      | 469     |   |      |   | 182      |      | 
|                                  |  | $    | (2,469  | ) |      | $ | 80,563   |      | 
|Expenses previous years           |  |      |         |   |      |   |          |      | 
|Losses in subsidiaries            |  | $    | -       |   |      | $ | -        |      | 
|General expenses                  |  |      | 15,374  |   |      |   | (16,104  | )    | 
|Expenses non-capitalized projects |  |      | -       |   |      |   | (36,135  | )    | 
|Interests                         |  |      | 6,959   |   |      |   | -        |      | 
|Depreciation of fixed assets      |  |      | 24,549  |   |      |   | -        |      | 
|Dry wells                         |  |      | 838     |   |      |   | 2,192    |      | 
|Royalties adjustment              |  |      | -       |   |      |   | 6,443    |      | 
|                                  |  | $    | 47,720  |   |      | $ | (43,604  | )    | 
|Net                               |  | $    | 50,189  |   |      | $ | (124,167 | )    | 



F-47







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (27) | Financial Income (Expenses),
                                         Net
| | ---- | -------------------------------------------------------------------------



The detail of financial income
(expenses), net for the years ended December 31 is as follows:



|                                          |  | 2013 |           |  | 2012 |   |           | 2011 | 
|----------------------------------------- |  | ---- | --------- |  | ---- | - | --------- | ---- | 
|Income                                    |  |      |           |  |      |   |           |      | 
|Foreign exchange gain (1)                 |  | $    | 3,219,704 |  |      | $ | 4,087,029 |      | 
|Equity method earnings                    |  |      | 120,060   |  |      |   | 125,474   |      | 
|Dividends in cash                         |  |      | 66,635    |  |      |   | 32,541    |      | 
|Yields and interest                       |  |      | 461,303   |  |      |   | 383,795   |      | 
|Hedging transactions (2)                  |  |      | 2,847     |  |      |   | 20,906    |      | 
|Others                                    |  |      | 8,328     |  |      |   | 5,647     |      | 
|Investment portfolio valuation earnings   |  |      | 59,609    |  |      |   | 178,076   |      | 
|                                          |  | $    | 3,938,486 |  |      | $ | 4,833,468 |      | 
|Expenses:                                 |  |      |           |  |      |   |           |      | 
|Foreign exchange loss (1)                 |  | $    | 3,201,732 |  |      | $ | 4,396,159 |      | 
|Interests                                 |  |      | 592,643   |  |      |   | 581,597   |      | 
|Hedging transactions (2)                  |  |      | 14,148    |  |      |   | 4,253     |      | 
|Other minor expenses                      |  |      | 84,310    |  |      |   | 19,092    |      | 
|Equity method loss                        |  |      | -         |  |      |   | 197       |      | 
|Administration and issuance of securities |  |      | -         |  |      |   | 59        |      | 
|                                          |  | $    | 3,892,833 |  |      | $ | 5,001,357 |      | 
|Net                                       |  | $    | 45,653    |  |      | $ | (167,889  | )    | 



| | (1) | The accumulated loss due to
                                         the exchange rate differences as of December 2013 was $17,972 (December 2012 - $309,130),
                                         mainly due to the devaluation of the Colombian peso of 8.97%. The accumulated revaluation
                                         of the exchange rate as of December 2012 was of 8.98%. As of December 2011 there were
                                         an income of $35,367 as a result of accumulative devaluation of 1.50%.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | The results of hedging transactions
                                         as of December 31, 2013 correspond to those derived from the exchange rate in Ocensa
                                         in the amount of ($7,466), Hocol in the amount of ($4,377) and Ecopetrol in the amount
                                         of $542.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (28) | Pension Expenses
| | ---- | ----------------



The detail of pension
expenses for the year ended December 31, is as follows:



|                                                   |  | 2013 |         |  | 2012 |   |         | 2011 | 
|-------------------------------------------------- |  | ---- | ------- |  | ---- | - | ------- | ---- | 
|Amortization of actuarial calculation and pensions |  | $    | 196,747 |  |      | $ | 688,693 |      | 
|Health care services                               |  |      | 226,643 |  |      |   | 204,269 |      | 
|Education services                                 |  |      | 55,347  |  |      |   | 55,493  |      | 
|                                                   |  | $    | 478,737 |  |      | $ | 948,455 |      | 



| | (29) | Inflation gain
| | ---- | --------------



Corresponds to the net amortization
of the deferred monetary correction in the amounts of $155, $97,663 and $21,836 for 2013, 2012 and 2011, respectively.



F-48







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (30) | Other Income (expenses)
                                         net
| | ---- | --------------------------------------------------------------------



The detail of other income
(expenses), net for the years ended December 31, is as follows:



|                                                                      |  | 2013 |         |  | 2012 |   |         | 2011 | 
|--------------------------------------------------------------------- |  | ---- | ------- |  | ---- | - | ------- | ---- | 
|Other income:                                                         |  |      |         |  |      |   |         |      | 
|Recovery of expenses                                                  |  | $    | 285,723 |  |      | $ | 61,443  |      | 
|Other minor income                                                    |  |      | 221,361 |  |      |   | 132,714 |      | 
|Deferred BOMT income                                                  |  |      | 130,690 |  |      |   | 125,542 |      | 
|Earnings from the sale of materials and property, plant and Equipment |  |      | 111,760 |  |      |   | 5,052   |      | 
|Recovery of exploration expenses                                      |  |      | -       |  |      |   | 23,722  |      | 
|Compensation received                                                 |  |      | 14,326  |  |      |   | 19,512  |      | 
|Income from services                                                  |  |      | 20,792  |  |      |   | 18,551  |      | 
|Recovery of services to associates                                    |  |      | -       |  |      |   | 4,743   |      | 
|Income from ceded rights                                              |  |      | 73,494  |  |      |   | 725     |      | 
|                                                                      |  | $    | 858,146 |  |      | $ | 392,004 |      | 
|Other expenses:                                                       |  |      |         |  |      |   |         |      | 
|Other minor expenses                                                  |  | $    | 241,927 |  |      | $ | 274,897 |      | 
|Gas pipeline availability under BOMT contracts                        |  |      | 102,819 |  |      |   | 108,134 |      | 
|Loss from fixed assets write-off                                      |  |      | 32,993  |  |      |   | 1,495   |      | 
|                                                                      |  | $    | 377,739 |  |      | $ | 384,526 |      | 
|                                                                      |  | $    | 480,407 |  |      | $ | 7,478   |      | 



| | (31) | Contingencies
| | ---- | -------------



Ecopetrol



The following is a summary
of the most significant legal proceedings with claims above $10,000 million pesos, for which allowances have been recognized,
in accordance with the evaluations of the Company’s internal and external advisors, as of December 31, 2013 and December
31, 2012:



|Proceeding                                       |  | Suit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | Allowance
    Amountas of December 31,2013 |         |  | AllowanceAmount as ofDecember 31,2012 |  
|------------------------------------------------ |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------ | ------- |  | ------------------------------------- | -
|Municipality of Arauca                           |  | Class action suit. Contributions to the solidarity
    and electric-power-generation revenues redistribution fund, pursuant to Act 142 of 1994.                                                                                                                                                                                                                                                                                                                                                                                                                                           |  | $                                          | 283,010 |  |                                       | $
|Municipalities of Aguazul, Tauramena             |  | Class action suit. Contributions to the solidarity and electric-power-generation
    income redistribution fund, pursuant to Act 142 of 1994.                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                                            | -       |  |                                       |  
|Association Contract                             |  | Class action suit from Luis Enrique Olivera Petro against Ecopetrol,
    the Nation, the Ministry of Mines and others, on the extension of the Garcero association contract.                                                                                                                                                                                                                                                                                                                                                                                                              |  |                                            | 155,184 |  |                                       |  
|Offshore Exploration and Production, LLC         |  | International Arbitration Court - In the framework
    of the purchase of Offshore International Group, the Seller (Offshore Exploration and Production LLC) filed a lawsuit to the
    Buyers (Ecopetrol and KNOC) in an international arbitration court before the International Center of Dispute Resolution, seeking
    to establish the liability limits acquired and established in the Purchase Agreement, in order to reject the claims and compensation
    requirements that Ecopetrol and KNOC have submitted to the Seller. Ecopetrol and KNOC filed a counterclaim lawsuit. |  |                                            | 23,122  |  |                                       |  
|16 Claims Salary Impact - saving - stimulus suit |  | Apply the salary impact to the amounts paid under the saving
    stimulus scheme and consequently reassess fringe benefit payments (legal and extralegal) and monthly pension payments, from
    the date at which Ecopetrol S.A. began recognizing it.                                                                                                                                                                                                                                                                                                                                   |  | $                                          | 18,689  |  |                                       | $



As of December 31, 2013, the
balance of the allowance for legal proceedings amounts to $516,446 (2012 - $770,922).



F-49





Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Other companies in the
Group



The following is a summary
of the most significant legal proceedings of other companies in the Group as of December 31, 2013 and 2012.



|Group Company               |  | Proceeding                                                                |  | Suit                                                                                                                                                                                                                                                                                                                                                                                  |  | AllowanceamountDecember 31, 2013 |       |  | AllowanceamountDecember 31, 2012 |  
|--------------------------- |  | ------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------- | ----- |  | -------------------------------- | -
|Refinería de Cartagena S.A. |  | Subsequent suspension of a service
    contract to provide maintenance    |  | Contractual action                                                                                                                                                                                                                                                                                                                                                                    |  | $                                | 100   |  |                                  | $
|Refinería de Cartagena S.A. |  | Class action suit – pro-Culture stamp                                     |  | Lower court - Awaiting decision.                                                                                                                                                                                                                                                                                                                                                      |  |                                  | -     |  |                                  |  
|Refinería de Cartagena S.A. |  | Class action suit –Contribution for power self-generation                 |  | Lower court – Beginning evidentiary phase.                                                                                                                                                                                                                                                                                                                                            |  |                                  | -     |  |                                  |  
|Oleoducto de los Llanos ODL |  | Administrative investigation before the Superintendence of Corporations   |  | Appeal for reversal of the Resolution issued by the Superintendence
    of Corporations, pursuant to which the Company received a sanction for late presentation of Form No. 13 for investments over
    assigned capital.                                                                                                                                                            |  |                                  | -     |  |                                  |  
|Hocol S.A.                  |  | Special appeal in cassation, Sole risk San Jacinto, La Hocha
    Contract |  | The appeal was admitted in April and the applicant was transferred.
    Hydrocarbon Services fired the appeal in cassation. In September, the Company presented the respective appeal. It is awaiting
    decision.                                                                                                                                                                   |  |                                  | 1,500 |  |                                  |  
|Hocol S.A.                  |  | Regular / Labor                                                           |  | Resolved favorably by the Court. The applicant presented an appeal
    on the grounds that the amount taken into account for the claim did not match the sentence. The Company ordered the main sentence
    to be paid by the pension fund, in the amount set by the Court; the proceeding is awaiting decision regarding the liquidation
    of payment.                            |  |                                  | 1,040 |  |                                  |  
|Hocol S.A.                  |  | Regular/Labor                                                             |  | Through which the Court declared that the work accident suffered
    by claimant Blanco Motta was the fault of the employer, San Antonio Internacional, sentencing the Company to pay full compensation
    for damages to the applicant and other claimants – family members                                                                                                         |  |                                  | 1,000 |  |                                  |  
|Hocol S.A.                  |  | Regular/Labor                                                             |  | Sentence declaring that in the events of the work accident that
    took place on July 21, 2008, in which Mr. Oswald Andrade Sánchez lost his life, there was Employer culpability on the
    part of Profesionales Técnicos S.A.S., and declaring the other defendants, Hocol S.A., Héctor Ramón Castañeda
    Mayor and Hugo Arenas Parrado joint and severally liable for payment. |  | $                                | 643   |  |                                  | $



| | (32) | Commitments
| | ---- | -----------



Ecopetrol S.A. Gas Supply
Contracts



In addition to existing contracts,
the Company has entered into new gas sale or supply contracts with third parties, such as, Gas Natural S.A. E.S.P., Gecelca S.A.
and Empresas Públicas de Medellín E.S.P. At June 2013, Ecopetrol had sold an average of 541.98 GBTUD in the amount
of $818,263 (2012 - $1,519,631) (including exports).



Ecopetrol S.A. and ODL
Finance S.A. Ship or Pay Contracts



Ecopetrol S.A. and ODL Finance
S.A. have signed the following Ship or Pay contracts: i) the first contract is an agreement that supports the five-year debt obligation
(Financial Tariff) with Grupo Aval. All payments are collected in a trust, from which the debt amortization payments are made.
This contract was replaced by a new one, subscribed in May 2010, for a seven-year term, to reflect the new terms agreed with Grupo
Aval, and ii) the second contract backs a securitization process (securities-related autonomous trust) for a seven-year term.
The securities are administered from their issuance date by an autonomous trust fund structured for that purpose, to which the
rights for invoicing, collecting and paying the securities holders have been assigned.



Under the first ship or pay
contract, ODL Finance S.A. is committed to transporting 75,000 barrels ofcrude a day during
the two-year grace period for the facility, and 90,000 barrels of crude oil per day during the subsequent five years. Under the
second contract, ODL Finance S.A. is committed to transport 19,500 barrels of crude during the first phase of the construction
project (which began operations in September 2009) and 39,000 barrels of crude oil a day from the beginning of the second phase,
which took place in the first quarter of 2010.



F-50







Ecopetrol S.A. and
Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Bicentenario Ship or Pay
Contract for Crude Oil Transportation



In order to finance the construction
Stages 0 and 1 of the Bicentenario oil pipeline, crude oil transportation contracts were signed, creating the obligation on the
part of the respective shareholder or affiliate to ship crude oil under its ownership: (i) from the Araguaney station to Coveñas,
(ii) under the ‘ship or pay’ modality, and (iii) up to the capacity of the shareholder, determined by its share in
Bicentenario, which will depend on the contracted capacity of all Bicentenario’s shareholders and/or affiliates, and which
shall not be less than 110,000 bpcd.



In exchange for the shipping
service, the shareholder or its affiliate must pay a fixed monthly fee, even if no barrels at all are shipped, from one of the
following dates, whichever comes first: (i) The date at which the oil pipeline begins operation or (ii) 12 months from the date
of the first disbursement of the syndicated loan, namely July 5, 2013. The right to receive the fee under the ship or pay modality
was assigned to an autonomous trust created for the purpose of administrating and making payments.



The contracts will initially
be in effect from the date of the first payment of the fee, or the date of the beginning of service, whichever takes place first,
and will end on either (a) 12 years after the beginning of the period, or (b) the day on which all of the obligations under the
contract have been discharged, whichever comes last. Once the above period has been completed, the contract will be in effect
for an additional period of 20 years.



Hocol S.A.



On
May 2013, Hocol S.A. and Surtigás S.A. E.S.P. signed a “Take or Pay” contract for gas production from Bonga
and Mamey field. Hocol as the seller has signed a guarantee in the amount of US$32,700,000 in favor of Surtigás, in order
to comply with the obligations under the contract. This guarantee must be in effect during the term of the contract or until the
Energy and Gas Regulatory Commission "CREG" (from the Spanish Comisión Reguladora de Energía y Gas) approve
all the investments required to expand the capacity of the transportation system of the Atlantic coast in the Mamey, San Mateo,
Sincelejo and Cartagena stretches. The expiration date of guarantee is November 30, 2014 (second year) and according to the contract
it should be renewed and updated thirty days before its expiration and have a term of one year. Hocol should recognize no liability
associated with this transaction.



In addition,
the company has 2 bank guarantees of US$34,253,000 and 24 Letters of Credit of US$51,662,671, to ensure the various commitments
that Hocol has with the National Hydrocarbons Agency (ANH) in exploration and production contracts. These guarantees have an effective
date between 2014 and 2016.



Ecopetrol del Perú
letters of guarantee



Article
21 of the Organic Act of Hydrocarbons of Perú requires that:



“Forall Contracts, each period of the exploration phase must feature a mandatory minimum work program. Each of said programs
shall be guaranteed by a bond, the amount of which shall be agreed with the Contracting Party, and which shall be joint and several,
unconditional, irrevocable, automatically enforced in Perú, without benefit of discussion, and issued by a Financial System
entity that is duly qualified and domiciled in the country.”



Pursuant to said Law, Ecopetrol
del Perú maintains a series of guarantee letters in effect to guarantee the Company’s undertakings to fulfill the
mandatory minimum work programs at the various sup-stages of exploration of the various oil lots provided in the following list:



ECOPETROL DEL PERÚ S.A.

GOODS AND AMOUNTS DELIVERED

(Expressed in USD)



|                               |  | Detail                       |  |                            |  | Amount Of                     |  |            |               |           |           |  |  
|------------------------------ |  | ---------------------------- |  | -------------------------- |  | ----------------------------- |  | ---------- | ------------- | --------- | --------- |  | -
|                               |  |                              |  | Expiration                 |  | Letter Of                     |  |            | Participation |           |           |  |  
|Starting
    Date              |  | Number                       |  | Description                |  | Beneficiary                   |  | Date       |               | Guarantee |           |  | %
|07/06/2010                     |  | CF No. 00110586 50 98001434  |  | License Contract - Lot 117 |  | INTERBANK                     |  | 10/30/2013 |               | $         | 1,400,000 |  |  
|08/24/2011                     |  | CF No. 00110586 52 980018597 |  | License Contract - Lot 101 |  | SCOTIABANK PERU SAA           |  | 03/15/2014 |               |           | 1,521,850 |  |  
|12/28/2012                     |  | CF No. 00110586 52 980024342 |  | License Contract - Lot 158 |  | MINISTERIO DE ENERGIA Y MINAS |  | 12/25/2013 |               |           | 66,507    |  |  
|12/28/2012                     |  | CF No. 00110586 55 980024343 |  | License Contract - Lot 134 |  | SCOTIABANK PERU SAA           |  | 02/10/2014 |               |           | 99,760    |  |  
|10/02/2013                     |  | CF No. 00110586 52 980027168 |  | License Contract - Lot 109 |  | PERUPETRO S.A.                |  | 03/26/2015 |               | $         | 2,100,000 |  |  
|TOTAL
    LETTERS OF GUARANTEE |  |                              |  |                            |  |                               |  |            |               |           |           |  |  



F-51







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (33) | Presentation
| | ---- | ------------



Certain line items from the
financial statements as of December 31, 2012 and 2011 were reclassified in order to make the presentation of such financial statements
comparable to that of the financial statements as of December 31, 2013.



| | (34) | Subsequent Events
| | ---- | -----------------



Dry well



As disclosed in note xiv.
Ecopetrol charged to expense an amount of $110,677 of capitalized exploratory cost regarding the Logan #1 dry well declared during
first quarter of 2014.



F-52







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | (35) | Differences
                                         between Colombian Governmental Entity accounting principles and U.S. GAAP
| | ---- | ------------------------------------------------------------------------------------------------------------------------------



The Company's consolidated financial statements
are prepared in accordance with Colombian Government Entity GAAP (RCP). These principles and regulations differ in certain
significant aspects from accounting principles generally accepted in the United States of America (U.S. GAAP), and therefore this
note presents reconciliations of net income and shareholders’ equity determined under Colombian Government Entity GAAP to
those same amounts as determined according to U.S. GAAP. Also presented in this note are those disclosures required under
U.S. GAAP but not required under Colombian Government Entity GAAP.



A) Reconciliation of net income attributable
to Ecopetrol:



The following table presents the reconciliation
of consolidated net income under Colombian Government Entity GAAP to consolidated net income under U.S. GAAP attributable to Ecopetrol
for the years ended December 31, 2013, 2012 and 2011:



|       |  |                                                                   |  | 2013 |            |   | 2012 |   |            | 2011 | 
|------ |  | ----------------------------------------------------------------- |  | ---- | ---------- | - | ---- | - | ---------- | ---- | 
|       |  |                                                                   |  |      |            |   |      |   |            |      | 
|       |  | Consolidated net income under Colombian Government Entity GAAP    |  | $    | 13,106,503 |   |      | $ | 14,778,947 |      | 
|i.     |  | Investment securities:                                            |  |      |            |   |      |   |            |      | 
|       |  | a. Unrealized gain (loss)                                         |  |      | 75,458     |   |      |   | (45,199    | )    | 
|       |  | b. Impairment                                                     |  |      | 65,921     |   |      |   | (34,657    | )    | 
|ii.    |  | Investments in non-marketable securities:                         |  |      |            |   |      |   |            |      | 
|       |  | a. Equity method                                                  |  |      | 66,558     |   |      |   | (109,749   | )    | 
|       |  | b. Variable interest entity (VIE)                                 |  |      | 13         |   |      |   | -          |      | 
|       |  | c. Impairment                                                     |  |      | (51,664    | ) |      |   | 9          |      | 
|iii.   |  | Derivatives                                                       |  |      | (3         | ) |      |   | (4,709     | )    | 
|iv.    |  | Exchange of non-monetary assets                                   |  |      | -          |   |      |   | -          |      | 
|v.     |  | Deferred charges                                                  |  |      | 476,091    |   |      |   | 493,159    |      | 
|vi.    |  | Employee benefit plans                                            |  |      | (40,439    | ) |      |   | (157,893   | )    | 
|vii.   |  | Provisions and contingencies                                      |  |      | 802,341    |   |      |   | 141,755    |      | 
|viii.  |  | Assets and liabilities present value                              |  |      | (39,029    | ) |      |   | (99,188    | )    | 
|ix.    |  | Deferred income taxes                                             |  |      | (685,981   | ) |      |   | (392,593   | )    | 
|x.     |  | Revenue recognition:                                              |  |      |            |   |      |   |            |      | 
|       |  | a. Cost of sales – over and under deliveries                      |  |      | 296,317    |   |      |   | 208,644    |      | 
|       |  | b. Other income                                                   |  |      | 28,242     |   |      |   | 6,100      |      | 
|xi.    |  | Inflation adjustment                                              |  |      | 46,283     |   |      |   | 165,867    |      | 
|xii.   |  | Inventories                                                       |  |      | 30,289     |   |      |   | (16,699    | )    | 
|xiii.  |  | Lease accounting                                                  |  |      | (50,101    | ) |      |   | (75,203    | )    | 
|xiv.   |  | Property, plant and equipment:                                    |  |      |            |   |      |   |            |      | 
|       |  | a. Interest                                                       |  |      | (480,513   | ) |      |   | (607,200   | )    | 
|       |  | b. Impairment                                                     |  |      | (188,615   | ) |      |   | (43,609    | )    | 
|       |  | Capitalized expenses                                              |  |      | (53,987    | ) |      |   | 17,685     |      | 
|       |  | Exchange difference                                               |  |      | (17,953    | ) |      |   | 28,793     |      | 
|xv.    |  | Depreciation, depletion and amortization                          |  |      | (33,177    | ) |      |   | 239,571    |      | 
|xvi.   |  | Asset retirement obligations                                      |  |      | (41,964    | ) |      |   | (117,988   | )    | 
|xvii.  |  | Equity contributions:                                             |  |      |            |   |      |   |            |      | 
|       |  | a. Incorporated institutional equity                              |  |      | 9,113      |   |      |   | 14,195     |      | 
|       |  | b. Reversal of concession rights contributed as capital           |  |      | 2,280      |   |      |   | 2,725      |      | 
|xviii. |  | Public offering cost and discount on issuance of shares           |  |      | -          |   |      |   | -          |      | 
|xix.   |  | Indebtedness cost                                                 |  |      | 1,385      |   |      |   | (36        | )    | 
|xx.    |  | Business combinations:                                            |  |      |            |   |      |   |            |      | 
|       |  | a. Goodwill                                                       |  |      | 403,460    |   |      |   | 275,271    |      | 
|       |  | b. Fair value adjustments to assets and liabilities acquired      |  |      | -          |   |      |   | -          |      | 
|xxi.   |  | Non-controlling interest                                          |  |      | 147,177    |   |      |   | 227,514    |      | 
|xxii.  |  | Cumulative translation adjustment                                 |  |      | 72,850     |   |      |   | (199,863   | )    | 
|       |  | Consolidated net income under U.S. GAAP attributable to Ecopetrol |  | $    | 13,946,855 |   |      | $ | 14,695,649 |      | 



F-53







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



B) Reconciliation of shareholders’
equity attributable to Ecopetrol:



The following table presents the reconciliation
of Ecopetrol shareholders’ equity under Colombian Government Entity GAAP to Ecopetrol shareholders’ equity under U.S.
GAAP attributable to Ecopetrol for the years ended December 31, 2013 and 2012:



|      |  |                                                                              |  | 2013 |             |   | 2012 |  
|----- |  | ---------------------------------------------------------------------------- |  | ---- | ----------- | - | ---- | -
|      |  |                                                                              |  |      |             |   |      |  
|      |  | Consolidated shareholders’ equity under Colombian Government Entity GAAP     |  | $    | 71,119,203  |   |      | $
|i.    |  | Investment securities:                                                       |  |      |             |   |      |  
|      |  | a. Unrealized gain                                                           |  |      | 1,248,863   |   |      |  
|ii.   |  | Investments in non-marketable securities:                                    |  |      |             |   |      |  
|      |  | a. Equity method                                                             |  |      | (1,639,221  | ) |      |  
|      |  | b. Variable interest entity (VIE)                                            |  |      | 320,600     |   |      |  
|      |  | c. Valuation surplus                                                         |  |      | (1,282,966  | ) |      |  
|      |  | d. Impairment                                                                |  |      | (104,699    | ) |      |  
|iii.  |  | Derivatives                                                                  |  |      | (2          | ) |      |  
|iv.   |  | Exchange of non-monetary assets                                              |  |      | 1,135,175   |   |      |  
|v.    |  | Deferred charges                                                             |  |      | (597,966    | ) |      |  
|vi.   |  | Employee benefit plans                                                       |  |      | (2,177,494  | ) |      |  
|vii.  |  | Provisions and contingencies                                                 |  |      | 1,294,564   |   |      |  
|viii. |  | Assets and liabilities present value                                         |  |      | (39,737     | ) |      |  
|ix.   |  | Deferred income taxes                                                        |  |      | (3,722,236  | ) |      |  
|x.    |  | Revenue recognition:                                                         |  |      |             |   |      |  
|      |  | a. Over and under deliveries - cost of sales                                 |  |      | 117,650     |   |      |  
|      |  | b. Other income                                                              |  |      | 27,112      |   |      |  
|xi.   |  | Inflation adjustment                                                         |  |      | (3,022,227  | ) |      |  
|xii.  |  | Inventories                                                                  |  |      | (18,410     | ) |      |  
|xiii. |  | Lease accounting                                                             |  |      | 190,612     |   |      |  
|xiv.  |  | Property, plant and equipment:                                               |  |      |             |   |      |  
|      |  | a. Interest                                                                  |  |      | (1,403,746  | ) |      |  
|      |  | b. Impairment                                                                |  |      | (1,046,498  | ) |      |  
|      |  | c. Revaluation of property, plant and equipment and public accounting effect |  |      | (25,678,134 | ) |      |  
|      |  | Capitalized expenses                                                         |  |      | (616,023    | ) |      |  
|      |  | Exchange difference                                                          |  |      | (180,764    | ) |      |  
|xv.   |  | Depreciation, depletion and amortization                                     |  |      | 5,357,117   |   |      |  
|xvi.  |  | Asset retirement obligations                                                 |  |      | 93,320      |   |      |  
|xvii. |  | Equity contributions:                                                        |  |      |             |   |      |  
|      |  | a. Incorporated institutional equity                                         |  |      | (28,613     | ) |      |  
|      |  | b. Reversal of concession rights contributed as capital                      |  |      | (14,733     | ) |      |  
|xix.  |  | Indebtedness cost                                                            |  |      | 7,828       |   |      |  
|xx.   |  | Business combinations:                                                       |  |      |             |   |      |  
|      |  | a. Goodwill                                                                  |  |      | 1,061,806   |   |      |  
|      |  | b. Fair value adjustments to assets and liabilities acquired                 |  |      | (1,405,659  | ) |      |  
|xxi.  |  | Non-controlling interest                                                     |  |      | 2,775,478   |   |      |  
|xxii. |  | Cumulative translation adjustment                                            |  |      | 105,025     |   |      |  
|      |  | Consolidated Ecopetrol shareholders’ equity under U.S. GAAP                  |  | $    | 41,875,225  |   |      | $



F-54







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



C) Supplemental condensed consolidated
financial statements under U.S. GAAP



1. Supplemental condensed consolidated
balance sheets of the Company as of December 31, 2013 and 2012 in conformity with under U.S. GAAP are presented below:



|                                                               |  | 2013 |            |  | 2012 |  
|-------------------------------------------------------------- |  | ---- | ---------- |  | ---- | -
|                                                               |  |      |            |  |      |  
|Assets                                                         |  |      |            |  |      |  
|Current assets:                                                |  |      |            |  |      |  
|Cash and cash equivalents                                      |  | $    | 8,750,039  |  |      | $
|Investments                                                    |  |      |            |  |      |  
|Available for sale                                             |  |      | 743,987    |  |      |  
|Held to maturity                                               |  |      | 99,007     |  |      |  
|Trading securities                                             |  |      | 569,119    |  |      |  
|Accounts and notes receivable, net                             |  |      | 8,139,457  |  |      |  
|Inventories                                                    |  |      | 3,209,523  |  |      |  
|Prepaid expenses and other assets                              |  |      | 593,550    |  |      |  
|Deferred income taxes                                          |  |      | 683,140    |  |      |  
|Restricted assets                                              |  |      | 123,031    |  |      |  
|Total current assets                                           |  | $    | 22,910,853 |  |      | $
|Long term assets                                               |  |      |            |  |      |  
|Investments                                                    |  |      |            |  |      |  
|Available for sale                                             |  |      | 1,748,497  |  |      |  
|Held to maturity                                               |  |      | -          |  |      |  
|Equity method                                                  |  |      | 1,119,981  |  |      |  
|Accounts and notes receivable, net                             |  |      | 541,019    |  |      |  
|Restricted assets                                              |  |      | 605,915    |  |      |  
|Property, plant and equipment, net                             |  |      | 41,041,256 |  |      |  
|Natural and environmental resources, net                       |  |      | 20,698,651 |  |      |  
|Goodwill                                                       |  |      | 1,095,047  |  |      |  
|Deferred charges and other assets                              |  |      | 1,018,401  |  |      |  
|Deferred income taxes                                          |  |      | 405,840    |  |      |  
|Capital lease                                                  |  |      | 502,456    |  |      |  
|Total assets                                                   |  | $    | 91,687,916 |  |      | $
|Liabilities and shareholders’ equity                           |  |      |            |  |      |  
|Current liabilities:                                           |  |      |            |  |      |  
|Financial obligations                                          |  | $    | 759,703    |  |      | $
|Accounts payable and related parties                           |  |      | 8,141,818  |  |      |  
|Taxes payable                                                  |  |      | 2,975,099  |  |      |  
|Dividends Payable                                              |  |      | 1,313,596  |  |      |  
|Labor and pension plan obligations                             |  |      | 289,629    |  |      |  
|Estimated liabilities and provisions                           |  |      | 2,047,490  |  |      |  
|Capital lease liability                                        |  |      | 126,695    |  |      |  
|Other short-term liabilities                                   |  |      | 25,170     |  |      |  
|Total current liabilities                                      |  | $    | 15,679,200 |  |      | $
|Financial obligations, long-term                               |  |      | 21,192,120 |  |      |  
|Accounts payable, long-term                                    |  |      | 56,230     |  |      |  
|Capital lease liability                                        |  |      | 772,273    |  |      |  
|Taxes payable                                                  |  |      | 512,099    |  |      |  
|Pension plan obligation and other labor obligations, long-term |  |      | 6,459,947  |  |      |  
|Estimated liabilities and provisions                           |  |      | 2,020,030  |  |      |  
|Other long-term liabilities                                    |  |      | 305,460    |  |      |  
|Total long term liabilities                                    |  |      | 31,318,159 |  |      |  
|Total liabilities                                              |  |      | 46,997,359 |  |      |  
|Shareholders’ equity of Ecopetrol                              |  |      | 41,875,226 |  |      |  
|Non-controlling interest                                       |  |      | 2,815,331  |  |      |  
|Total equity                                                   |  | $    | 44,690,557 |  |      | $
|Total liabilities and shareholders’ equity                     |  | $    | 91,687,916 |  |      | $



F-55







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



2. Supplemental consolidated statements
of income



The consolidated statements of income
of the Company for the years ended December 31, 2013, 2012 and 2011 in conformity with under U.S. GAAP are presented below:



|                                                                         |  | 2013 |                |   | 2012 |   |                | 2011 | 
|------------------------------------------------------------------------ |  | ---- | -------------- | - | ---- | - | -------------- | ---- | 
|                                                                         |  |      |                |   |      |   |                |      | 
|Revenue:                                                                 |  |      |                |   |      |   |                |      | 
|Local sales                                                              |  | $    | 26,425,495     |   |      | $ | 24,918,476     |      | 
|Foreign sales                                                            |  |      | 42,007,150     |   |      |   | 41,948,661     |      | 
|Total revenue                                                            |  |      | 68,432,645     |   |      |   | 66,867,137     |      | 
|                                                                         |  |      |                |   |      |   |                |      | 
|Cost of sales                                                            |  |      | 40,173,040     |   |      |   | 38,353,685     |      | 
|Gross income                                                             |  |      | 28,259,605     |   |      |   | 28,513,452     |      | 
|                                                                         |  |      |                |   |      |   |                |      | 
|Operating expenses:                                                      |  |      |                |   |      |   |                |      | 
|Administration                                                           |  |      | 1,457,994      |   |      |   | 2,057,796      |      | 
|Selling and projects                                                     |  |      | 3,481,675      |   |      |   | 2,898,693      |      | 
|Operating income                                                         |  |      | 23,319,936     |   |      |   | 23,556,963     |      | 
|                                                                         |  |      |                |   |      |   |                |      | 
|Non-operating income, net                                                |  |      | (58,573        | ) |      |   | (1,143,481     | )    | 
|Income before income tax                                                 |  |      | 23,261,363     |   |      |   | 22,413,482     |      | 
|                                                                         |  |      |                |   |      |   |                |      | 
|Income tax:                                                              |  |      |                |   |      |   |                |      | 
|Current income tax                                                       |  |      | 8,291,571      |   |      |   | 7,095,874      |      | 
|Deferred income tax                                                      |  |      | 483,248        |   |      |   | 430,114        |      | 
|                                                                         |  |      | 8,774,819      |   |      |   | 7,525,988      |      | 
|Net income                                                               |  |      | 14,486,544     |   |      |   | 14,887,494     |      | 
|Less: Net income attributable to non-controlling interest                |  |      | (539,689       | ) |      |   | (191,845       | )    | 
|Net Income attributable to Ecopetrol                                     |  | $    | 13,946,855     |   |      | $ | 14,695,649     |      | 
|Earnings per share (Basic) attributable to Ecopetrol common shareholders |  | $    | 339.20         |   |      | $ | 357.41         |      | 
|Weighted-average shares outstanding (Basic)                              |  |      | 41,116,698,456 |   |      |   | 41,116,698,456 |      | 



F-56







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



3. Supplemental consolidated comprehensive
income



|                                                                      |  | 2013 |            |   | 2012 |   |            | 2011 | 
|--------------------------------------------------------------------- |  | ---- | ---------- | - | ---- | - | ---------- | ---- | 
|                                                                      |  |      |            |   |      |   |            |      | 
|Net income                                                            |  | $    | 14,486,544 |   |      | $ | 14,887,494 |      | 
|Other comprehensive income, net of tax:                               |  |      |            |   |      |   |            |      | 
|Unrealized gain (loss) on investment securities, net of tax:          |  |      | 44,293     |   |      |   | 18,088     |      | 
|Unrealized actuarial gain (loss), net of tax                          |  |      | 731,709    |   |      |   | (57,500    | )    | 
|Translation gain (loss) adjustment                                    |  |      | 1,556,233  |   |      |   | (943,192   | )    | 
|Total other comprehensive income                                      |  |      | 2,332,236  |   |      |   | (982,604   | )    | 
|Comprehensive income                                                  |  |      | 16,929,458 |   |      |   | 13,904,890 |      | 
|Comprehensive income attributable to the non-controlling
    interest |  |      | (627,438   | ) |      |   | (141,999   | )    | 
|Comprehensive income attributable to Ecopetrol                        |  | $    | 16,191,692 |   |      |   | 13,762,891 |      | 



A reconciliation of accumulated other
comprehensive income attributable to Ecopetrol, including the related income tax effects, is presented below:



|                                                          |  | 2013                         |           
|--------------------------------------------------------- |  | ---------------------------- | ----------
|                                                          |  | Before-Income Tax
    Amount |           
|                                                          |  |                              |           
|Unrealized gain on securities available for sale          |  | $                            | 1,239,347 
|Pension liability – net unamortized actuarial gain (loss) |  |                              | (3,111,731
|Cumulative translation adjustment                         |  |                              | (7,144    
|Other comprehensive income (loss)                         |  | $                            | (1,879,528



|                                                          |  | 2012                         |           
|--------------------------------------------------------- |  | ---------------------------- | ----------
|                                                          |  | Before-Income Tax
    Amount |           
|                                                          |  |                              |           
|Unrealized gain (loss) on securities available for sale   |  | $                            | 1,242,990 
|Pension liability – net unamortized actuarial gain (loss) |  |                              | (4,203,835
|Cumulative translation adjustment                         |  |                              | (1,476,022
|Other comprehensive income (loss)                         |  | $                            | (4,436,867



|                                                          |  | 2011                         |           
|--------------------------------------------------------- |  | ---------------------------- | ----------
|                                                          |  | Before-Income Tax
    Amount |           
|                                                          |  |                              |           
|Unrealized gain (loss) on securities available for sale   |  | $                            | 1,197,304 
|Pension liability - net unamortized actuarial gain (loss) |  |                              | (4,118,015
|Cumulative translation adjustment                         |  |                              | (582,797  
|Other comprehensive income (loss)                         |  | $                            | (3,503,508



The following table explains the reclassifications
out of Accumulates Other Comprehensive Income for the period ended December 31, 2013, 2012 and 2011



|                                                                         |  | Unrealized Gains and
    Losses on available-for-sale
    Securities |          
|------------------------------------------------------------------------ |  | -------------------------------------------------------------------- | ---------
|                                                                         |  | 2013                                                                 |          
|Beginning Balance                                                        |  | $                                                                    | 1,196,553
|Other Comprehensive income before reclasifications                       |  |                                                                      | 180,951  
|Amounts reclassified from accumulated other comprehensive
    income (a) |  |                                                                      | (136,701 
|Net current-period other comprehensive income                            |  |                                                                      | 44,250   
|Ending Balance                                                           |  | $                                                                    | 1,240,803



(a) Affected line item in the statement where
net income is presented: Realized gain / (loss) on sale of securities.



F-57







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



4. Supplemental condensed consolidated statements
of cash flows



The statements of cash flows of the Company
for the years ended December 31, 2013, 2012 and 2011 under U.S. GAAP are presented below:



|                                                                                         |  | 2013 |             |   | 2012 |   |             | 2011 | 
|---------------------------------------------------------------------------------------- |  | ---- | ----------- | - | ---- | - | ----------- | ---- | 
|                                                                                         |  |      |             |   |      |   |             |      | 
|Cash flows provided by operating activities:                                             |  |      |             |   |      |   |             |      | 
|Net income                                                                               |  | $    | 13,946,855  |   |      | $ | 14,695,649  |      | 
|Adjustments to reconcile net income to cash provided by operating activities:            |  |      |             |   |      |   |             |      | 
|Non-controlling interest                                                                 |  |      | 539,689     |   |      |   | 191,845     |      | 
|Equity method in non-marketable securities                                               |  |      | (185,514    | ) |      |   | (15,528     | )    | 
|Depreciation, depletion and amortization                                                 |  |      | 4,849,461   |   |      |   | 4,977,009   |      | 
|Accretion Expense                                                                        |  |      | 177,545     |   |      |   | 148,593     |      | 
|Capitalized exploratory well costs charged to expense                                    |  |      | 939,419     |   |      |   | 278,254     |      | 
|Impairment                                                                               |  |      | 377,792     |   |      |   | 276,147     |      | 
|Provisions                                                                               |  |      | (219,692    | ) |      |   | 431,293     |      | 
|Deferred income tax                                                                      |  |      | 483,248     |   |      |   | 428,559     |      | 
|Exchange gain (loss)                                                                     |  |      | (84,783     | ) |      |   | 267,125     |      | 
|Loss on retirement of property, plant and equipment                                      |  |      | 19,678      |   |      |   | 64,385      |      | 
|Losses in retirement of natural and environmental resources                              |  |      | 19,438      |   |      |   | 358,599     |      | 
|Other asset write-offs                                                                   |  |      | -           |   |      |   | -           |      | 
|Net changes in operating assets and liabilities:                                         |  |      |             |   |      |   |             |      | 
|Accounts and notes receivable                                                            |  |      | (3,922,852  | ) |      |   | (1,099,884  | )    | 
|Inventories                                                                              |  |      | (472,975    | ) |      |   | (423,073    | )    | 
|Deferred charges and other assets                                                        |  |      | (231,681    | ) |      |   | (1,060,411  | )    | 
|Accounts payable and related parties                                                     |  |      | 1,186,615   |   |      |   | 2,668,864   |      | 
|Taxes payable                                                                            |  |      | (785,356    | ) |      |   | (2,890,533  | )    | 
|Labor obligations                                                                        |  |      | 165,724     |   |      |   | 888,708     |      | 
|Estimated liabilities and provisions                                                     |  |      | (41,752     | ) |      |   | (58,268     | )    | 
|Bargain purchase gain                                                                    |  |      | -           |   |      |   | -           |      | 
|Net cash provided by operating activities                                                |  |      | 16,760,859  |   |      |   | 20,127,333  |      | 
|Cash flows from investing activities:                                                    |  |      |             |   |      |   |             |      | 
|Payment for purchase of companies, net of cash acquired                                  |  |      | -           |   |      |   | -           |      | 
|Dividends received                                                                       |  |      | 73,501      |   |      |   | 32,541      |      | 
|Purchase of investment securities                                                        |  |      | (7,656,234  | ) |      |   | (15,281,566 | )    | 
|Redemption of investment securities                                                      |  |      | 11,933,853  |   |      |   | 14,458,913  |      | 
|Proceeds from sales of property, plant and equipment                                     |  |      | (103,753    | ) |      |   | -           |      | 
|Investment in natural and environmental resources                                        |  |      | (6,278,439  | ) |      |   | (5,872,995  | )    | 
|Additions to property, plant and equipment                                               |  |      | (7,226,860  | ) |      |   | (9,350,074  | )    | 
|Net cash used in investing activities                                                    |  |      | (9,050,426  | ) |      |   | (16,013,181 | )    | 
|Cash flows from financing activities:                                                    |  |      |             |   |      |   |             |      | 
|Repayment of financial obligations                                                       |  |      | (3,207,566  | ) |      |   | (1,203,309  | )    | 
|Proceeds from financial obligations                                                      |  |      | 10,727,037  |   |      |   | 5,995,738   |      | 
|Proceeds from issuance of shares                                                         |  |      | 82          |   |      |   | 171,582     |      | 
|Cash paid to acquire a non-controlling interest                                          |  |      | -           |   |      |   | (1,917      | )    | 
|Dividends paid                                                                           |  |      | (14,570,466 | ) |      |   | (8,419,331  | )    | 
|Net cash used in financing activities                                                    |  |      | (7,050,913  | ) |      |   | (3,457,237  | )    | 
|Effect of exchange rate changes on cash                                                  |  |      | 118,184     |   |      |   | 241,870     |      | 
|Net increase (decrease) in cash and cash equivalents                                     |  |      | 659,520     |   |      |   | 656,915     |      | 
|Cash and cash equivalents at beginning of year                                           |  |      | 7,972,335   |   |      |   | 7,073,550   |      | 
|Cash and cash equivalents at end of year                                                 |  | $    | 8,750,039   |   |      | $ | 7,972,335   |      | 
|                                                                                         |  |      |             |   |      |   |             |      | 
|Supplemental cash flows information                                                      |  |      |             |   |      |   |             |      | 
|Cash paid during the year                                                                |  |      |             |   |      |   |             |      | 
|Interest                                                                                 |  | $    | 581,541     |   |      | $ | 732,335     |      | 
|Income taxes                                                                             |  | $    | 7,289,682   |   |      | $ | 8,320,779   |      | 
|                                                                                         |  |      |             |   |      |   |             |      | 
|Non-cash transactions                                                                    |  |      |             |   |      |   |             |      | 
|Liabilities assumed in business combinations                                             |  | $    | -           |   |      | $ | -           |      | 
|Assets acquired through capital lease contracts                                          |  | $    | 8,460       |   |      | $ | 260,648     |      | 
|Increase of natural and environmental resources through
    asset retirement obligations |  | $    | 417,238     |   |      | $ | (156,871    | )    | 



Under Colombian Government Entity GAAP
as in effect from 2007, some deposits with banks were considered as short-term investments since they produced yields and the
Company has defined them to be used for specific purposes. Under U.S. GAAP, these deposits are considered cash and are valued
at fair value. The amounts reclassified as of December 31, 2013 was $119, as of December 31, 2012 there were not any amount
reclassified and as of December 31, 2011 was $487,922.



F-58







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



5. Supplemental consolidated statements
of shareholders’ equity.



The statements of shareholders’
equity of the Company for the years ended December 31, 2013, 2012 and 2011 under U.S. GAAP as follows:



|                                                                                 |  | Common Stock     |        |  |       |   |            |                           |  |   |                     |   |  |                  |            |   |                                            |   |             |                   |  |   |                         |  
|-------------------------------------------------------------------------------- |  | ---------------- | ------ |  | ----- | - | ---------- | ------------------------- |  | - | ------------------- | - |  | ---------------- | ---------- | - | ------------------------------------------ | - | ----------- | ----------------- |  | - | ----------------------- | -
|                                                                                 |  | MillionsOfshares |        |  | Value |   |            | Additionalpaid-in-capital |  |   | ComprehensiveIncome |   |  | Retainedearnings |            |   | AccumulatedOtherComprehensiveincome (loss) |   |             | Ecopetrol’sEquity |  |   | Non-ControllingInterest |  
|Balance at December
    31, 2010                                                 |  |                  | 40,473 |  |       | $ | 10,118,128 |                           |  | $ | 4,044,053           |   |  |                  |            |   |                                            | $ | 13,775,291  |                   |  | $ | (762,184                | )
|Business combination                                                             |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | -          |   |                                            |   | -           |                   |  |   | -                       |  
|Acquired non-controlling interest                                                |  |                  | -      |  |       |   | -          |                           |  |   | (792,440            | ) |  |                  | -          |   |                                            |   | -           |                   |  |   | -                       |  
|Issuance of shares                                                               |  |                  | 644    |  |       |   | 161,047    |                           |  |   | 1,963,687           |   |  |                  | -          |   |                                            |   | -           |                   |  |   | -                       |  
|Distribution of dividends                                                        |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | -          |   |                                            |   | (5,868,515  | )                 |  |   | -                       |  
|Comprehensive income:                                                            |  |                  |        |  |       |   |            |                           |  |   |                     |   |  |                  |            |   |                                            |   |             |                   |  |   |                         |  
|Net income                                                                       |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  | $                | 15,057,599 |   |                                            |   | 14,817,207  |                   |  |   | -                       |  
|Other comprehensive income, net of tax:                                          |  |                  |        |  |       |   |            |                           |  |   |                     |   |  |                  |            |   |                                            |   |             |                   |  |   |                         |  
|Unrealized earnings on investment securities,
    net of tax effect of $7,086    |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | (529,751   | ) |                                            |   | -           |                   |  |   | -                       |  
|Actuarial (loss), net of tax effect of $488,064                                  |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | (990,918   | ) |                                            |   | -           |                   |  |   | -                       |  
|Translation adjustment                                                           |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  | $                | 150,424    |   |                                            |   | -           |                   |  |   | -                       |  
|Total other comprehensive
    income                                             |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | (1,370,245 | ) |                                            |   | -           |                   |  |   | (1,401,097              | )
|Comprehensive income                                                             |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  | $                | 13,687,354 |   |                                            |   | -           |                   |  |   | -                       |  
|Balance at December 31, 2011                                                     |  | $                | 41,117 |  |       | $ | 10,279,175 |                           |  | $ | 5,215,300           |   |  |                  |            |   |                                            | $ | 22,723,983  |                   |  | $ | (2,163,281              | )
|Acquired non-controlling interest                                                |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | -          |   |                                            |   | (689        | )                 |  |   | -                       |  
|Other non-controlling interest                                                   |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | -          |   |                                            |   | (103        | )                 |  |   | -                       |  
|Spin-off                                                                         |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | -          |   |                                            |   | -           |                   |  |   | -                       |  
|Issuance of Company shares                                                       |  |                  | -      |  |       |   | -          |                           |  |   | 166,090             |   |  |                  | -          |   |                                            |   | -           |                   |  |   | -                       |  
|Distribution of dividends                                                        |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | -          |   |                                            |   | (12,335,009 | )                 |  |   | -                       |  
|Comprehensive income:                                                            |  |                  |        |  |       |   |            |                           |  |   |                     |   |  |                  |            |   |                                            |   |             |                   |  |   |                         |  
|Net income                                                                       |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  | $                | 14,887,494 |   |                                            |   | 14,695,648  |                   |  |   | -                       |  
|Other comprehensive income, net of tax:                                          |  |                  |        |  |       |   |            |                           |  |   |                     |   |  |                  |            |   |                                            |   |             |                   |  |   |                         |  
|Unrealized earnings on investment securities,
    net of tax effect of $(27,734) |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | 18,088     |   |                                            |   | -           |                   |  |   | -                       |  
|Actuarial (loss), net of tax effect of $27,522                                   |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | (57,500    | ) |                                            |   | -           |                   |  |   | -                       |  
|Translation adjustment                                                           |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | (943,192   | ) |                                            |   | -           |                   |  |   | -                       |  
|Total other comprehensive
    income                                             |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  | $                | (982,604   | ) |                                            |   | -           |                   |  |   | (932,758                | )
|Comprehensive income                                                             |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  | $                | 13,904,890 |   |                                            |   | -           |                   |  |   | -                       |  
|Balance at December 31, 2012                                                     |  | $                | 41,117 |  |       | $ | 10,279,175 |                           |  | $ | 5,381,390           |   |  |                  | -          |   |                                            | $ | 25,083,830  |                   |  | $ | (3,096,039              | )
|Other non-controling interest                                                    |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | -          |   |                                            |   | 14          |                   |  |   | -                       |  
|Issuance of Company shares                                                       |  |                  | -      |  |       |   | -          |                           |  |   | 127                 |   |  |                  | -          |   |                                            |   | -           |                   |  |   | -                       |  
|Distribution of dividends                                                        |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | -          |   |                                            |   | (11,964,960 | )                 |  |   | -                       |  
|Net income                                                                       |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  | $                | 14,486,544 |   |                                            |   | 13,946,855  |                   |  |   | -                       |  
|Other comprehensive income, net of tax:                                          |  |                  |        |  |       |   |            |                           |  |   |                     |   |  |                  |            |   |                                            |   |             |                   |  |   |                         |  
|Unrealized earnings on investment securities,
    net of tax effect of $47,885   |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | 44,293     |   |                                            |   | -           |                   |  |   | -                       |  
|Actuarial (loss), net of tax effect of $(360,396)                                |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | 731,709    |   |                                            |   | -           |                   |  |   | -                       |  
|Translation adjustment                                                           |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  |                  | 1,556,584  |   |                                            |   | -           |                   |  |   | -                       |  
|Total other comprehensive
    income                                             |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  | $                | 2,332,586  |   |                                            |   | -           |                   |  |   | 2,244,837               |  
|Comprehensive income                                                             |  |                  | -      |  |       |   | -          |                           |  |   | -                   |   |  | $                | 16,819,130 |   |                                            |   | -           |                   |  |   | -                       |  
|Balance at December 31, 2013                                                     |  | $                | 41,117 |  |       | $ | 10,279,175 |                           |  | $ | 5,381,517           |   |  |                  |            |   |                                            | $ | 27,065,740  |                   |  | $ | (851,202                | )



F-59







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



D) Summary of significant differences
between Colombian Government Entity GAAP and U.S. GAAP and required U.S. GAAP disclosures



|i. | INVESTMENT
    SECURITIES
|-- | -------------------------



The Company’s investments include
both marketable and non-marketable securities. Under Colombian Government Entity GAAP, the Company classifies investment
securities based on the form of their investment return, either as fixed-yield investment or as variable-yield investments. Fixed-yield
investments generally represent debt securities and are initially recorded at cost with subsequent adjustments to fair value recorded
in the income statement. Variable-yield investments generally represent equity securities or interests in other entities
and are initially recorded at cost. Subsequent adjustments to fair value are made with increases in fair value resulting
in an increase to equity, while decreases in fair value are charged to the income statement. Fair values are determined using
quoted market prices, if and when available. In the absence of quoted market prices, these investments are recorded at Management’s
estimate of fair value using discounted cash flow techniques.



Under U.S. GAAP, the Company has classified
its investment securities as held to maturity or available for sale, as defined in ASC 320-10-25, Accounting for Certain Investments
in Debt and Equity Securities. Debt security investments for which the Company has demonstrated its ability and intent to hold
until maturity are classified as held-to-maturity. Such investments are reported at amortized cost. Investments classified
as available-for-sale are reported at fair value, with unrealized gains and losses reported, net of taxes, as a component of other
comprehensive income. Investment held for trading securities are recorded at fair value with unrealized holding gains and losses
included in net income.



In the event that any other than temporary
impairment of the investments value occurs, the impairment loss is recorded in net income.



The Company’s short-term and long-term
investments at December 31, 2013, 2012, and 2011 consist of the following:



|As of December 31, 2013                                                    |  | Aggregated
    FairValue |           |  | Gross
    UnrealizedHolding Gains |   |           | Gross
    UnrealizedHolding Losses |  |   | GrossRecognizedLosses |   |  | Cost
    Basis |  
|-------------------------------------------------------------------------- |  | ------------------------ | --------- |  | --------------------------------- | - | --------- | ---------------------------------- |  | - | --------------------- | - |  | -------------- | -
|Short-term Investments – available for
    sale securities:                |  |                          |           |  |                                   |   |           |                                    |  |   |                       |   |  |                |  
|Securities issued or secured by Colombian
    government                   |  | $                        | 100,299   |  |                                   | $ | 130       |                                    |  | $ | (825                  | ) |  | $              | -
|Securities issued or secured by financial entities                         |  |                          | 643,688   |  |                                   |   | 7         |                                    |  |   | -                     |   |  |                | -
|Other debt securities                                                      |  |                          | -         |  |                                   |   | -         |                                    |  |   | -                     |   |  |                | -
|Total short-term investments
    classified as available for sale          |  |                          | 743,987   |  |                                   |   | 137       |                                    |  |   | (825                  | ) |  |                | -
|Long-term investments – available for sale
    securities:                 |  |                          |           |  |                                   |   |           |                                    |  |   |                       |   |  |                |  
|Securities issued or secured by Colombian government                       |  |                          | 110,195   |  |                                   |   | -         |                                    |  |   | (1,668                | ) |  |                | -
|Securities issued or secured by government sponsored
    enterprise (GSEs) |  |                          | 42,129    |  |                                   |   | 13        |                                    |  |   | (29                   | ) |  |                | -
|Securities issued or secured by financial entities                         |  |                          | 8,136     |  |                                   |   | -         |                                    |  |   | (1                    | ) |  |                | -
|Securities issued or secured by the U.S. government                        |  |                          | 73,794    |  |                                   |   | 76        |                                    |  |   | -                     |   |  |                | -
|Other debt securities                                                      |  |                          | 9,286     |  |                                   |   | -         |                                    |  |   | (108                  | ) |  |                | -
|Securities issued by mixed-
    economy governmental entities              |  |                          | 1,504,957 |  |                                   |   | 1,243,959 |                                    |  |   | -                     |   |  |                | -
|Total long-term investments
    classified as available for sale           |  |                          | 1,748,497 |  |                                   |   | 1,244,048 |                                    |  |   | (1,806                | ) |  |                | -
|Total available for sale                                                   |  | $                        | 2,492,484 |  |                                   | $ | 1,244,185 |                                    |  | $ | (2,631                | ) |  | $              | -



|                                                                |  | Aggregated Fair
    Value |        |  | Gross Unrealized
    Holding Gains |   |       | Gross
    Unrealized
    Holding Losses |  |   | Net Carrying
    Amount |  
|--------------------------------------------------------------- |  | ------------------------- | ------ |  | ---------------------------------- | - | ----- | --------------------------------------- |  | - | ----------------------- | -
|Short-term investments – held to maturity securities:           |  |                           |        |  |                                    |   |       |                                         |  |   |                         |  
|Securities issued or secured by Colombian government            |  | $                         | 98,039 |  |                                    | $ | 3,950 |                                         |  | $ | -                       |  
|Other debt securities                                           |  |                           | 1,692  |  |                                    |   | -     |                                         |  |   | (3,226                  | )
|Total short-term investments classified
    as held to maturity |  |                           | 99,731 |  |                                    |   | 3,950 |                                         |  |   | (3,226                  | )
|Total held to maturity                                          |  | $                         | 99,731 |  |                                    | $ | 3,950 |                                         |  | $ | (3,226                  | )



|                                                             |  | 2013 |         |  | 2012 |   |   | 2011 | 
|------------------------------------------------------------ |  | ---- | ------- |  | ---- | - | - | ---- | 
|Short-term Investments – Trading securities:                 |  |      |         |  |      |   |   |      | 
|Other debt securities or mixed/economy governmental entities |  | $    | 569,119 |  |      | $ | - |      | 
|Total Short-term Investments classified as Trading           |  | $    | 569,119 |  |      | $ | - |      | 



F-60







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



|As of December 31, 2012                                                    |  | AggregatedFairValue |           |  | GrossUnrealizedHolding Gains |   |           | Gross
    UnrealizedHolding Losses |  |   | GrossRecognizedLosses |   |  | CostBasis |        
|-------------------------------------------------------------------------- |  | ------------------- | --------- |  | ---------------------------- | - | --------- | ---------------------------------- |  | - | --------------------- | - |  | --------- | -------
|Short-term Investments – available for
    sale securities:                |  |                     |           |  |                              |   |           |                                    |  |   |                       |   |  |           |        
|Securities issued or secured by Colombian
    government                   |  | $                   | 844,764   |  |                              | $ | 29,365    |                                    |  | $ | (41                   | ) |  | $         | (27,899
|Securities issued or secured by government sponsored
    enterprise (GSEs) |  |                     | 92,536    |  |                              |   | -         |                                    |  |   | (57                   | ) |  |           | -      
|Securities issued or secured by financial entities                         |  |                     | 197,933   |  |                              |   | 989       |                                    |  |   | (5                    | ) |  |           | (734   
|Other debt securities                                                      |  |                     | 196,432   |  |                              |   | 1,000     |                                    |  |   | (90                   | ) |  |           | (967   
|Total short-term investments
    classified as available for sale          |  | $                   | 1,331,665 |  |                              | $ | 31,354    |                                    |  | $ | (193                  | ) |  | $         | (29,600
|Long-term investments – available for sale
    securities:                 |  |                     |           |  |                              |   |           |                                    |  |   |                       |   |  |           |        
|Securities issued or secured by Colombian government                       |  |                     | 2,156,611 |  |                              |   | 59,719    |                                    |  |   | (1,059                | ) |  |           | (17,363
|Securities issued or secured by government sponsored
    enterprise (GSEs) |  |                     | 1,545,377 |  |                              |   | 3,466     |                                    |  |   | (401                  | ) |  |           | (2,865 
|Securities issued or secured by financial entities                         |  |                     | 18,112    |  |                              |   | 362       |                                    |  |   | -                     |   |  |           | (309   
|Securities issued or secured by the U.S. government                        |  |                     | 44,265    |  |                              |   | 18        |                                    |  |   | -                     |   |  |           | -      
|Other debt securities                                                      |  |                     | 464,202   |  |                              |   | 5,103     |                                    |  |   | (283                  | ) |  |           | (2,466 
|Securities issued by mixed-
    economy governmental entities              |  |                     | 1,367,178 |  |                              |   | 1,106,181 |                                    |  |   | -                     |   |  |           | -      
|Total long-term investments
    classified as available for sale           |  | $                   | 5,595,745 |  |                              | $ | 1,174,849 |                                    |  | $ | (1,743                | ) |  | $         | (23,003
|Total available for sale                                                   |  | $                   | 6,927,410 |  |                              | $ | 1,206,203 |                                    |  | $ | (1,936                | ) |  | $         | (52,603



|                                                                |  | Aggregated FairValue |        |  | Gross UnrealizedHolding Gains |   |       | Gross
    UnrealizedHolding Losses |  |   | Net CarryingAmount |  
|--------------------------------------------------------------- |  | -------------------- | ------ |  | ----------------------------- | - | ----- | ---------------------------------- |  | - | ------------------ | -
|Short-term investments – held to maturity
    securities:       |  |                      |        |  |                               |   |       |                                    |  |   |                    |  
|Other debt securities                                           |  | $                    | 2,411  |  |                               | $ | -     |                                    |  | $ | (2,642             | )
|Total short-term investments
    classified as held to maturity |  | $                    | 2,411  |  |                               | $ | -     |                                    |  | $ | (2,642             | )
|Long-term investments- held to maturity securities:             |  |                      |        |  |                               |   |       |                                    |  |   |                    |  
|Securities issued or secured
    by Colombian government        |  |                      | 96,791 |  |                               |   | 8,803 |                                    |  |   | -                  |  
|Total long-term investments
    classified as held to maturity  |  | $                    | 96,791 |  |                               | $ | 8,803 |                                    |  | $ | -                  |  
|Total held to maturity                                          |  | $                    | 99,202 |  |                               | $ | 8,803 |                                    |  | $ | (2,642             | )



|As of December 31, 2011                                                    |  | AggregatedFair Value |           |  | Gross
    UnrealizedHolding Gains |   |           | GrossUnrealizedHolding Losses |  |   | GrossRecognizedLosses |   |  | Cost
    Basis |        
|-------------------------------------------------------------------------- |  | -------------------- | --------- |  | --------------------------------- | - | --------- | ----------------------------- |  | - | --------------------- | - |  | -------------- | -------
|Short-term investments – available for
    sale securities:                |  |                      |           |  |                                   |   |           |                               |  |   |                       |   |  |                |        
|Securities issued or secured by Colombian
    government                   |  | $                    | 496,184   |  |                                   | $ | 17,151    |                               |  | $ | (279                  | ) |  | $              | (10,257
|Securities issued or secured by government sponsored
    enterprise (GSEs) |  |                      | 48,672    |  |                                   |   | 270       |                               |  |   | -                     |   |  |                | -      
|Securities issued or secured by financial entities                         |  |                      | 293,111   |  |                                   |   | 1,613     |                               |  |   | (36                   | ) |  |                | (1,430 
|Other debt securities                                                      |  |                      | 71,194    |  |                                   |   | 338       |                               |  |   | (10                   | ) |  |                | (136   
|Total short-term investments
    classified as available for sale          |  | $                    | 909,161   |  |                                   | $ | 19,372    |                               |  | $ | (325                  | ) |  | $              | (11,823
|Long-term investments – available for sale
    securities:                 |  |                      |           |  |                                   |   |           |                               |  |   |                       |   |  |                |        
|Securities issued or secured by Colombian government                       |  |                      | 806,961   |  |                                   |   | 22,083    |                               |  |   | (9,075                | ) |  |                | (9,397 
|Securities issued or secured by government sponsored
    enterprise (GSEs) |  |                      | 2,100,055 |  |                                   |   | 7,422     |                               |  |   | (1,374                | ) |  |                | (56    
|Securities issued or secured by financial entities                         |  |                      | 259,745   |  |                                   |   | 100       |                               |  |   | (1,818                | ) |  |                | -      
|Securities issued or secured by the U.S. government                        |  |                      | 700,237   |  |                                   |   | 503       |                               |  |   | (16                   | ) |  |                | (60    
|Other debt securities                                                      |  |                      | 208,334   |  |                                   |   | 631       |                               |  |   | (153                  | ) |  |                | -      
|Securities issued by mixed-
    economy governmental entities              |  |                      | 1,401,506 |  |                                   |   | 1,140,507 |                               |  |   | -                     |   |  |                | -      
|Total long-term investments
    classified as available for sale           |  | $                    | 5,476,838 |  |                                   | $ | 1,171,246 |                               |  | $ | (12,436               | ) |  | $              | (9,513 
|Total available for
    sale                                               |  | $                    | 6,385,999 |  |                                   | $ | 1,190,618 |                               |  | $ | (12,761               | ) |  | $              | (21,336



|                                                                |  | Aggregated FairValue |         |  | Gross UnrealizedHolding Gains |   |        | GrossUnrealizedHolding Losses |  |   | Net CarryingAmount |  
|--------------------------------------------------------------- |  | -------------------- | ------- |  | ----------------------------- | - | ------ | ----------------------------- |  | - | ------------------ | -
|Short-term investments – held to maturity
    securities:       |  |                      |         |  |                               |   |        |                               |  |   |                    |  
|Other debt securities                                           |  | $                    | 3,477   |  |                               | $ | -      |                               |  | $ | (3,322             | )
|Securities issued or secured
    by Colombian government        |  |                      | 12,285  |  |                               |   | 81     |                               |  |   | -                  |  
|Total short-term investments
    classified as held to maturity |  | $                    | 15,762  |  |                               | $ | 81     |                               |  | $ | (3,322             | )
|                                                                |  |                      |         |  |                               |   |        |                               |  |   |                    |  
|Long-term investments- held to maturity securities:             |  |                      |         |  |                               |   |        |                               |  |   |                    |  
|Securities issued or secured
    by Colombian government        |  |                      | 109,629 |  |                               |   | 11,257 |                               |  |   | -                  |  
|Total long-term investments
    classified as held to maturity  |  | $                    | 109,629 |  |                               | $ | 11,257 |                               |  | $ | -                  |  
|Total held to maturity                                          |  | $                    | 125,391 |  |                               | $ | 11,338 |                               |  | $ | (3,322             | )



F-61









Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The maturities of fixed-income investments
as of December 31, 2013 and 2012 are as follows:



|As of December 31, 2013 
|------------------------
|                        
|                        
|                        
|Due in one year or less 
|Due in one to five years
|Total                   



|As of December 31, 2012 
|------------------------
|                        
|                        
|                        
|Due in one year or less 
|Due in one to five years
|Due in five to ten years
|Total                   



Amounts recorded in other comprehensive
income in prior years realized on available for sale securities sold during 2013, 2012 and 2011 were:



|       |  | 2013 |         |  | 2012 |   |        | 2011 | 
|------ |  | ---- | ------- |  | ---- | - | ------ | ---- | 
|       |  |      |         |  |      |   |        |      | 
|Losses |  | $    | 1,566   |  |      | $ | 2,004  |      | 
|Gains  |  | $    | 138,268 |  |      | $ | 33,955 |      | 



Foreign exchange gains and losses on
available for sale securities



Under Colombian Government Entity GAAP,
changes in account balances resulting from variations in foreign currency exchange rates are reflected in the Company’s
net income. Under U.S. GAAP, any change in value of available-for-sale debt securities as a result of changes in foreign
currency exchange rates is reflected in equity as required under the guidance in ASC 320-10-35.  The amount reclassified
from earnings under Colombian Government Entity GAAP purposes to other comprehensive income for U.S. GAAP purposes includes $36,627,
$(112,060) and $197,664 in 2013, 2012 and 2011, respectively that correspond to exchange rate differences.



|a. | Unrealized gain (loss)
|-- | ----------------------



Available-for-sale securities in an unrealized
loss position as of December 31, 2013 and 2012 are as follows:



As of December 31, 2013



|                                                                       |  | Less than 12 months |         |  | 12 Months or Greater |   |     | Total      | 
|---------------------------------------------------------------------- |  | ------------------- | ------- |  | -------------------- | - | --- | ---------- | 
|Descriptions of Securities                                             |  | Fair Value          |         |  | UnrealizedLosses     |   |     | Fair Value | 
|Securities issued or secured by Colombian government                   |  | $                   | 90,089  |  |                      | $ | 825 |            | 
|Securities issued or secured by financial entities                     |  |                     | 25,308  |  |                      |   | -   |            | 
|Securities issued or secured by government sponsored enterprise (GSEs) |  |                     | -       |  |                      |   | -   |            | 
|Other debt securities                                                  |  |                     | -       |  |                      |   | -   |            | 
|Total                                                                  |  | $                   | 115,397 |  |                      | $ | 825 |            | 



|As of December 31, 2012                                               
|----------------------------------------------------------------------
|                                                                      
|Descriptions of Securities                                            
|Securities issued or secured by Colombian government                  
|Securities issued or secured by financial entities                    
|Securities issued or secured by government sponsored enterprise (GSEs)
|Other debt securities                                                 
|Total                                                                 



F-62







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Restricted Assets



Under U.S. GAAP the Company classifies
as restricted assets, those assets where their availability depends on a court decision, contractual or legal restrictions, such
as cash, trust funds or investments. The detail of restricted assets as of December 31, 2013 and 2012 is as follows:



|Concept                    |  | 2013 |         |  | 2012 |  
|-------------------------- |  | ---- | ------- |  | ---- | -
|Investment securities      |  | $    | 371,386 |  |      | $
|Specific destination funds |  |      | 299,703 |  |      |  
|Cash                       |  |      | 57,857  |  |      |  
|Total                      |  | $    | 728,946 |  |      | $



In Specific destination funds the most
significant items are resources intended to guarantee contractual obligations of our subsidiaries Equión $3,409, ODL Finance
$7,378, Oleoducto Bicentenario $111,481, Ocensa $960 and Cenit $20,210 related to the abandonment cost of Caño Limon pipelines.



Other significant restricted assets are
related to Santiago de las Atalayas Fund which is detailed in the chart below:



|Concept                        |  | 2013 |         |  | 2012 |  
|------------------------------ |  | ---- | ------- |  | ---- | -
|Investments available for sale |  | $    | 371,387 |  |      | $
|Specific destination funds *   |  |      | 73,467  |  |      |  
|Cash                           |  |      | 510     |  |      |  
|Total                          |  | $    | 445,364 |  |      | $



*This fund receives the coupons and principal
payments of Santiago de las Atalayas investments in U.S. dollars.



The investments related to Santiago de
las Atalayas at December 31, 2013 and 2012 consist of the following:



|As of December 31, 2013                                                    |  | AggregatedFair Value |         |  | GrossUnrealizedHolding Gains |   |     | GrossUnrealizedHoldingLosses |  |   | GrossRecognizedLosses |   |  | Cost
    Basis |     
|-------------------------------------------------------------------------- |  | -------------------- | ------- |  | ---------------------------- | - | --- | ---------------------------- |  | - | --------------------- | - |  | -------------- | ----
|Short-term Investments – available for
    sale securities:                |  |                      |         |  |                              |   |     |                              |  |   |                       |   |  |                |     
|Securities
    issued or secured by Colombian government                   |  | $                    | 9,118   |  |                              | $ | 23  |                              |  | $ | (45                   | ) |  | $              | -   
|Securities issued by mixed
    – economy governmental entities             |  |                      | 16,064  |  |                              |   | -   |                              |  |   | (24                   | ) |  |                | -   
|Securities
    issued or secured by financial entities                     |  |                      | 65,889  |  |                              |   | 133 |                              |  |   | (15                   | ) |  |                | (133
|Total Short-term Investments
    classified as available for sale          |  | $                    | 91,071  |  |                              | $ | 156 |                              |  | $ | (84                   | ) |  | $              | (133
|Long-term Investments – available for sale
    securities:                 |  |                      |         |  |                              |   |     |                              |  |   |                       |   |  |                |     
|Securities issued or secured
    by Colombian government                   |  |                      | 62,123  |  |                              |   | 174 |                              |  |   | (1,272                | ) |  |                | -   
|Securities issued or secured
    by government sponsored enterprise (GSEs) |  |                      | 162,130 |  |                              |   | 22  |                              |  |   | (70                   | ) |  |                | -   
|Securities issued by mixed-
    economy governmental entities              |  |                      | 36,888  |  |                              |   | 340 |                              |  |   | (1,273                | ) |  |                | -   
|Securities
    issued or secured by the U.S. government                    |  |                      | 19,175  |  |                              |   | -   |                              |  |   | (37                   | ) |  |                | -   
|Total
    Long-term Investments classified as available for sale           |  | $                    | 280,316 |  |                              |   | 536 |                              |  |   | (2,652                | ) |  |                | -   
|Total  Available
    for Sale                                              |  | $                    | 371,387 |  |                              | $ | 692 |                              |  | $ | (2,736                | ) |  | $              | (133



|As of December 31, 2012                                           |  | AggregatedFair Value |         |  | GrossUnrealizedHolding Gains |   |        | GrossUnrealizedHoldingLosses |  |   | GrossRecognizedLosses |   |  | Cost
    Basis |        
|----------------------------------------------------------------- |  | -------------------- | ------- |  | ---------------------------- | - | ------ | ---------------------------- |  | - | --------------------- | - |  | -------------- | -------
|Short-term Investments – available for
    sale securities:       |  |                      |         |  |                              |   |        |                              |  |   |                       |   |  |                |        
|Securities issued
    or secured by Colombian government          |  | $                    | 30,297  |  |                              | $ | 6,903  |                              |  | $ | (6                    | ) |  | $              | (6,896 
|Total Short-term Investments classified as available
    for sale |  |                      | 30,297  |  |                              |   | 6,903  |                              |  |   | (6                    | ) |  |                | (6,896 
|Long-term Investments – available for sale
    securities:        |  |                      |         |  |                              |   |        |                              |  |   |                       |   |  |                |        
|Securities issued or secured by Colombian government              |  |                      | 378,819 |  |                              |   | 31,759 |                              |  |   | (7                    | ) |  |                | (6,555 
|Other debt securities                                             |  |                      | 15,098  |  |                              |   | 106    |                              |  |   | -                     |   |  |                | -      
|Total Long-term Investments
    classified as available for sale  |  | $                    | 393,917 |  |                              | $ | 31,865 |                              |  | $ | (7                    | ) |  | $              | (6,555 
|Total Available for Sale                                          |  | $                    | 424,214 |  |                              | $ | 38,768 |                              |  | $ | (13                   | ) |  | $              | (13,451



The unrealized gains and losses of the
restricted assets are recognized in other comprehensive income.



|b. | Impairment
|-- | ----------



Impairment of investment securities are
reported differently under Colombian Government Entity GAAP and U.S. GAAP. Under Colombian Government Entity GAAP, impairment
is charged to income in the current period, but recoveries in value can be recorded up to the amount that was originally impaired.
Under U.S. GAAP, other-than-temporary impairments should be charged to income in the current period and a new cost basis for the
security is established. Subsequent increases in the cost basis of an impaired investment as a result of a recovery in fair value
are included in other comprehensive income.



F-63







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The Company has a policy under which they
conduct periodic reviews of marketable securities to assess whether other-than-temporary impairment exists. A number of factors
are considered in performing an impairment analysis of securities. Those factors include:



|a) | The length of time and the
    extent to which the fair value of the security has been less than cost;
|-- | ------------------------------------------------------------------------------------------------------



|b) | The
    financial condition and near-term prospects of the issuer, including any specific events which influence the operations of
    the issuer (such as changes in technology that may impair the earnings potential of the investment, or the discontinuance
    of a segment of a business that may affect the future earnings potential); and
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|c) | The
    analysis as instructed in ASC 320-10-65-1, which includes the comparison of the fair value and the amortized cost, evaluates
    the Company’s intention to sell the security. If it is more-likely-than-not, the company will be required to sell the
    security prior to recovery, including the existence of a credit loss.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The Company also takes into account changes
in global and regional economic conditions and changes related to specific issuers or industries that could adversely affect these
values.



Ecopetrol’s marketable security
portfolio consists only of debt securities, such as treasury investments, bonds, and commercial papers. For this reason, the Company
has an internal policy to limit the ratings of their investments and issuers as follows:



|Credit Rating Agency       |  | Short
                                         – Term

Credit Rating |     |  | Long
                                         – Term

Credit Rating | 
|-------------------------- |  | -------------------------------------------------------------------- | --- |  | ------------------------------------------------------------------- | 
|Standard & Poor’s          |  |                                                                      | A-1 |  |                                                                     | 
|Moody’s Investors Services |  |                                                                      | P-1 |  |                                                                     | 
|Fitch Ratings              |  |                                                                      | F-1 |  |                                                                     | 



The Company recognized impairments on
its investment securities amounting to $133, $50,126 and $116 in 2013, 2012 and 2011, respectively.



|ii. | INVESTMENTS
    IN NON-MARKETABLE SECURITIES
|--- | --------------------------------------------



|a. | Equity
    Method and Valuation Surplus
|-- | ---------------------------------------



Under Colombian Government Entity GAAP,
equity securities for which prices are unquoted, or for which trading volume is lower, and the Company does not control the investee,
are accounted for under the cost method and subsequently are valued by the equity method. Under the equity method, the Company
accounts for the difference between its proportionate share of shareholders' equity of the investee and its acquisition cost,
adjusted for inflation through 2001, in a separate valuation account in the assets and equity (valuation surplus), if the proportionate
share of shareholders’ equity of the investee is higher than its cost or as an allowance for losses, affecting net income,
if the cost is higher than the proportionate share of shareholders’ equity of the investee. Under this method, the Company
only records dividends as income when received. From 2008 the Colombian Government Entity GAAP incorporated the concept of significant
influence for the recognition of investments in associated entities and established the equity method to update these investments.



Under U.S. GAAP, an investment in a non-marketable
equity security is recorded using the equity method when the investor can exercise significant influence over the investee, or
the cost method when significant influence cannot be exercised. Under the equity method of accounting for U.S. GAAP the carrying
value of such an investment is adjusted to reflect (1) the Company’s proportionate share of earnings or losses from the
investee and (2) additional investments and distributions of dividends. The Company’s proportionate share of income or loss
is reported in earnings however any dividends or additional investments are reported only as an adjustment of the carrying amount
of the investment.



The differences between the application
of the cost and the equity method under U.S. GAAP were:



| ̈ | Reversal of valuations
    and allowances for losses recorded under Colombian Government Entity GAAP
|- | ----------------------------------------------------------------------------------------------------
| ̈ | Reversal of inflation adjustments recorded
    under Colombian Government Entity GAAP               
| ̈ | Reversal of Goodwill amortization and
    impairment                                                
| ̈ | Inclusion of share of earnings or losses
    under U.S. GAAP, net of inter-company eliminations     
| ̈ | Inclusion of share in Other Comprehensive
    Income under U.S. GAAP                                
| ̈ | Recognition of impairment under U.S.
    GAAP                                                       



F-64







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The summary of the investments valued
by the equity method for U.S. GAAP purposes is shown in the following table:



For the Year Ended December 31, 2013





|Company                        |  | Percentage ofVotingInterest |       |   | EquityCalculatedunderU.S. GAAP |   |           | EquityUnderColombianGAAP |  |   | AssetsUnderColombianGAAP |  |  | LiabilitiesUnderColombianGAAP |           |  | Net Income(Loss) UnderColombianGAAP |   |         | InvestmentUnder U.S.GAAP EquityMethod |  |   | EquityMethodAccountingAdj (*) |  |  | ImpairmentUnder U.S.GAAP |         |  | Total
    EquityMethodInvestment |  
|------------------------------ |  | --------------------------- | ----- | - | ------------------------------ | - | --------- | ------------------------ |  | - | ------------------------ |  |  | ----------------------------- | --------- |  | ----------------------------------- | - | ------- | ------------------------------------- |  | - | ----------------------------- |  |  | ------------------------ | ------- |  | -------------------------------- | -
|                               |  |                             |       |   |                                |   |           |                          |  |   |                          |  |  |                               |           |  |                                     |   |         |                                       |  |   |                               |  |  |                          |         |  |                                  |  
|Invercolsa S.A.                |  |                             | 43.35 | % |                                | $ | 252,973   |                          |  | $ | 621,319                  |  |  | $                             | 622,105   |  |                                     | $ | 785     |                                       |  | $ | 51,644                        |  |  | $                        | 109,664 |  |                                  | $
|Serviport S.A.                 |  |                             | 49.00 | % |                                |   | 15,525    |                          |  |   | 14,938                   |  |  |                               | 47,222    |  |                                     |   | 32,284  |                                       |  |   | 2,511                         |  |  |                          | 7,607   |  |                                  |  
|Offshore International Group   |  |                             | 50.00 | % |                                |   | 1,076,347 |                          |  |   | 1,076,347                |  |  |                               | 2,049,502 |  |                                     |   | 973,155 |                                       |  |   | 109,925                       |  |  |                          | 538,174 |  |                                  |  
|Ecodiesel S.A.                 |  |                             | 50.00 | % |                                |   | 52,976    |                          |  |   | 53,353                   |  |  |                               | 137,384   |  |                                     |   | 84,031  |                                       |  |   | 22,765                        |  |  |                          | 26,488  |  |                                  |  
|Sociedad Portuaria de Olefinas |  |                             | 50.00 | % |                                |   | 1,022     |                          |  |   | 1,299                    |  |  |                               | 1,518     |  |                                     |   | 219     |                                       |  |   | 198                           |  |  |                          | 511     |  |                                  |  
|Transgas de Occidente S.A.     |  |                             | 20.00 | % |                                |   | 149,189   |                          |  |   | 211,622                  |  |  |                               | 308,655   |  |                                     |   | 97,024  |                                       |  |   | 12,525                        |  |  |                          | 29,838  |  |                                  |  
|                               |  |                             |       |   |                                |   |           |                          |  |   |                          |  |  |                               |           |  |                                     |   |         |                                       |  |   |                               |  |  | $                        | 712,282 |  |                                  | $



For the Year Ended December 31, 2012

|Company                        |  | Percentage ofVotingInterest |       |   | EquityCalculatedunderU.S. GAAP |   |         | EquityUnderColombianGAAP |  |   | AssetsUnderColombianGAAP |  |  | LiabilitiesUnderColombianGAAP |           |  | Net Income(Loss) UnderColombianGAAP |   |         | InvestmentUnder U.S.GAAPEquityMethod |  |   | EquityMethodAccountingAdj (*) |  |  | TotalEquityMethodInvestment |        
|------------------------------ |  | --------------------------- | ----- | - | ------------------------------ | - | ------- | ------------------------ |  | - | ------------------------ |  |  | ----------------------------- | --------- |  | ----------------------------------- | - | ------- | ------------------------------------ |  | - | ----------------------------- |  |  | --------------------------- | -------
|                               |  |                             |       |   |                                |   |         |                          |  |   |                          |  |  |                               |           |  |                                     |   |         |                                      |  |   |                               |  |  |                             |        
|Invercolsa S.A.                |  |                             | 43.35 | % |                                | $ | 208,648 |                          |  | $ | 554,914                  |  |  | $                             | 571,945   |  |                                     | $ | 17,031  |                                      |  | $ | 82,570                        |  |  | $                           | 90,449 
|Serviport S.A.                 |  |                             | 49.00 | % |                                |   | 6,660   |                          |  |   | 14,679                   |  |  |                               | 47,919    |  |                                     |   | 33,240  |                                      |  |   | 2,181                         |  |  |                             | 3,263  
|Offshore International Group   |  |                             | 50.00 | % |                                |   | 914,845 |                          |  |   | 914,845                  |  |  |                               | 1,794,451 |  |                                     |   | 879,606 |                                      |  |   | 122,287                       |  |  |                             | 457,422
|Ecodiesel S.A.                 |  |                             | 50.00 | % |                                |   | 30,938  |                          |  |   | 38,817                   |  |  |                               | 129,258   |  |                                     |   | 90,441  |                                      |  |   | 17,455                        |  |  |                             | 15,469 
|Sociedad Portuaria de Olefinas |  |                             | 50.00 | % |                                |   | 452     |                          |  |   | 878                      |  |  |                               | 1,224     |  |                                     |   | 346     |                                      |  |   | 112                           |  |  |                             | 226    
|Transgas de Occidente S.A.     |  |                             | 20.00 | % |                                |   | 127,912 |                          |  |   | 206,382                  |  |  |                               | 356,244   |  |                                     |   | 149,862 |                                      |  |   | 7,285                         |  |  |                             | 25,582 
|                               |  |                             |       |   |                                |   |         |                          |  |   |                          |  |  |                               |           |  |                                     |   |         |                                      |  |   |                               |  |  | $                           | 592,411



(*) Represents the purchase price allocation
adjustments



|Concept                                     |  | 2013 |         |   | 2012 |  
|------------------------------------------- |  | ---- | ------- | - | ---- | -
|Fair value of property, plant and equipment |  | $    | (9,946  | ) |      | $
|Goodwill                                    |  |      | 469,316 |   |      |  
|Total                                       |  | $    | 459,370 |   |      | $



The number of shares which the Company
owns with respect to its investment in Invercolsa S.A. has been subject to a legal dispute with another Invercolsa shareholder. 
Lower court decisions had ruled in favor of both the Company and the other shareholder and a final court decision in January 2011
determined that 324 million shares, equivalent to 11.58% of the capital stock of Invercolsa should be returned to Ecopetrol. 
As a result Ecopetrol controls 43.35%. The dividends paid relating to the shares returned to Ecopetrol are still in dispute, as
well as the ownership of shares constituting 8.53% of Invercolsa. The resolution of these matters is still pending.



|b. | Variable
    Interest Entity (VIE)
|-- | ----------------------------------



Under U.S. GAAP, ASC 810-10-15-10 requires
that consolidated financial statements include subsidiaries in which the Company has a controlling financial interest, i.e., a
majority voting interest.  However, application of the majority voting interest requirement to certain types of entities
may not identify the party with a controlling financial interest because that interest may be achieved through other arrangements. 
Thus, the U.S. GAAP rules also require a Company to consolidate a variable interest entity if that company is the primary beneficiary
of the VIE, with that has the power to direct the activities of the VIE that most significantly affect the entity’s
economic performance and will absorb a majority of the entity’s expected losses, receive a majority of the entity’s
expected residual returns, or both.  In determining whether it is a primary beneficiary of a variable interest entity, a
company shall treat variable interests in that same entity held by the Company’s related parties as its own interest. 
Under Colombian Government Entity GAAP, consolidated financial statements only include subsidiaries in which the Company has the
majority voting interest.



In October 2009, the subsidiary Oleoducto
de los Llanos Orientales (hereinafter “ODL”) assigned its rights under a "Ship or Pay” contract for the
completion of a securitization for the purpose of obtaining funds required to finish the second phase of the project, the refund
of capital to the associates, and maintaining the capital structure initially agreed. The structure of this issuance was made
through assets in a trust fund (hereinafter “Fideicomiso P.A. ODL - ECOPETROL”) administered by Corficolombiana S.A.,
who has to pay the security holder on the due dates. Additionally, each month, the trust company must report to ODL income and
expenses that are generated in this process and that are paid, if applicable, to ODL as advances.



Based on the ASC 810, ODL determined that
it must consolidate Fideicomiso P.A. ODL - ECOPETROL, since it is a VIE and ODL is the primary beneficiary.



F-65







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The adjustments of Fideicomiso P. A. ODL
– ECOPETROL, according to financial information under U.S. GAAP as of and for the years ended December 31, 2013 and 2012,
are as follows:



|            |  | 2013 |         |   | 2012 |  
|----------- |  | ---- | ------- | - | ---- | -
|            |  |      |         |   |      |  
|Assets      |  | $    | (93,076 | ) |      | $
|Liabilities |  |      | 93,076  |   |      |  
|Equity      |  | $    | -       |   |      | $
|Net income  |  | $    | -       |   |      | $



The financial information summary of Fideicomiso
P. A. ODL - ECOPETROL according to U.S. GAAP as of and for the years ended December 31, 2013 and 2012, are as follows:



|            |  | 2013 |          |   | 2012 |  
|----------- |  | ---- | -------- | - | ---- | -
|            |  |      |          |   |      |  
|Assets      |  | $    | 433,560  |   |      | $
|Liabilities |  |      | (306,923 | ) |      |  
|Equity      |  | $    | 126,636  |   |      | $
|Net income  |  | $    | 106,675  |   |      | $



|c. | Impairment
|-- | ----------



Under Colombian Government Entity GAAP
it is not mandatory to perform impairment tests of the Equity Method Investments unless positive evidence is identified.



Under U.S. GAAP ASC 323-10-35-31 to 33
and 325-20-35 1A and 2, assets held at cost, including non-marketable equity investments, should be evaluated for impairment if
the Company is aware of any events or changes in circumstances that may have significant adverse effects on the fair value of
the investment.  If the Company believes such circumstances exist, the Company would estimate the asset’s fair value
and compare that to cost to determine if any impairment is necessary. During 2013 and 2012 the Company evaluated its investments
and concluded that there were recorded an impairment of $51,671.



|iii. | DERIVATIVES
|---- | -----------



Ecopetrol is exposed to market risk from
changes in foreign currency exchange rates, interest rate risk of its financial obligations and to commodity price risk, resulting
from the fluctuations of international crude oil prices which affect its earnings, cash flows and financial condition. Ecopetrol
manages and constantly monitors its exposure to these market risks through its regular operating and financial activities and,
when appropriate, through the use of derivative financial instruments.



Ecopetrol has established control activities
to assess, approve and monitor derivative financial instrument operations. Ecopetrol does not buy, hold or sell derivative financial
instruments for trading purposes. Ecopetrol's primary foreign currency exposures relate to the U.S. dollar; however, Ecopetrol
manages and constantly monitors its foreign currency risk position internally, using non-deliverable forwards, according to the
size of the mismatches between its asset-liability position in U.S. dollars and its asset-liability position in Colombian pesos.
If no mismatches occur, Ecopetrol has a perfect natural hedge. Ecopetrol may utilize other derivative agreements to mitigate changes
in the fair value of commodities or foreign exchange. None of the derivatives were designated or documented for hedge accounting.
In addition, only the subsidiary Hocol S.A. is exposed to foreign currency fluctuations due to the expenditures are denominated
in currencies other than its functional currency, which is the U.S. dollar.



According to the Company’s risk
policy, for international negotiations the minimum required credit rating of each counterparty shall be “A” for long
term, and “A1/P1/F1” in short term. For local negotiations minimum required credit risk of each counterparty shall
be “AAA” for long term, and “F1+/BRC1+” for short term.



These derivatives are recognized at their
fair value as either a financial asset or obligation with corresponding income or expense recognized.



Total results recognized related to derivative
activities during the years are as follows:



|            |  | 2013     |       |  | 2012       |   |     | 2011     | 
|----------- |  | -------- | ----- |  | ---------- | - | --- | -------- | 
|            |  | Realized |       |  | Unrealized |   |     | Realized | 
|Options (1) |  | $        | 467   |  |            | $ | (45 | )        | 
|Swaps       |  |          | -     |  |            |   | -   |          | 
|Forwards    |  |          | 542   |  |            |   | -   |          | 
|Total       |  | $        | 1,009 |  |            | $ | (45 | )        | 



(1)	Amounts include premiums
paid



F-66







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Under RCP, each derivative has its own
accounting treatment depending on the type of derivative. Option premiums paid are recorded as deferred charges and amortized
to the income statement as financial expense on a straight-line basis over the life of the contract, the option contract is recognized
in memo accounts unless it is likely to be exercised, and the gain is recognized as an investment.  Swap and forward contract
net results are recorded as an investment. In all cases, gains and losses are recognized in earnings as financial income or expense.
Amounts receivable or payable upon maturity resulting from net payments are recorded using current rates for the period.



U.S. GAAP requires that all derivative
instruments be recorded on the balance sheet at fair value.  Changes in the fair value of derivatives are recorded each period
in earnings.  The fair value of derivatives instruments is recorded as other assets and other liabilities.



Under U.S. GAAP, embedded derivative instruments
shall be separated from the host contract, and accounted for using different measurement attributes, if certain conditions are
met.  In the case of the Company, some contracts to which the Company a counterparty include embedded foreign exchange derivatives.
According to ASC 815-15-15-10 through 13 these contracts do not require separate accounting for the embedded derivative and the
host contract because contract payments are made in the functional currency of a party to the contract or contract payments are
made in a currency in which the price of the good or service delivered is routinely denominated in international commerce.



|iv. | EXCHANGE
    OF NON-MONETARY ASSETS
|--- | -----------------------------------



During 2007, the Company exchanged a refinery
business with a book value of $234,371 for a 49% interest in Refinería de Cartagena S.A. The Company estimated the fair
value of the 49% investment as $1,369,546. Under Colombian Government Entity GAAP, this difference between the cost of the assets
given and the fair value of the assets received was recorded as an increase to asset revaluation and equity. However, under ASC
845-10-30, 51% of the difference between the book value of the Refinery and the fair value of the assets received, which the Company
determined to be a more reliable indicator of the value of the exchange, was recorded in the results of operations as a gain in
the amount of $578,939. The remaining 49% of unrealized gain was recorded as a deferred gain with a corresponding increase to
the investment, equivalent to a deferred gain of $556,236, to be amortized over the expected useful life of the equipment. In
2011, the Company determined that in 2009, as a result of the acquisition of the remaining participation in Reficar S.A., the
unamortized unrealized gain should have been recorded at fair value since the Company obtained the remaining 51% of Refinería
de Cartagena S.A. in 2009 in line with the acquired entity’s fair value of the assets and liabilities acquired as of
May 27, 2009. However, according to ASC 250 and SAB 108, we do not consider such amount significant and decided to fully amortize
the remaining balance as of 2011. As a result, the net income reconciliation includes amortized income of $425,521 in 2011.



|v. | DEFERRED
    CHARGES
|-- | --------------------



Under Colombian Government Entity GAAP,
the Equity Tax is recognized as a deferred charge for the total amount due payable during the years 2011 through 2014. The deferred
charge is amortized as an expense of the year based on the payments made. The local regulatory entities also allowed companies
that applied inflation adjustments and still have outstanding balances in the Equity Revaluation account to reduce such balance
instead of recognizing a deferred charge. Under U.S. GAAP Equity Tax was fully expensed in 2011 since amortization of certain
expenses is not allowed under ASC 350.



Other deferred assets recognized under
Colombian Government Entity GAAP are related to certain pre-operating expenses and other charges that include normal recurring
maintenance and fees. Under U.S. GAAP  ASC 730 forbids namely capitalization of pre-operating expenses and thus established
that these are expensed as incurred.



For U.S. GAAP purposes, the amount of
the adjustment in the Company’s net income related to deferred expenses amounting to $476,091 in 2013, $493,159 in 2012,
1,710,944 in 2011.



|vi. | EMPLOYEE
    BENEFIT PLANS
|--- | --------------------------



Under Colombian Government Entity GAAP,
the Company estimates the net present value of its actuarial obligation for all pension plans and other post-retirement obligations.
Annually, the Company estimates the net present value of the actuarial obligation and adjusts it accordingly. The amounts of the
adjustments related to health care, education and severance plans are reflected in the Company’s net income. However, the
amounts related to the pension and bonds plans are recorded in memorandum accounts.



For other post-retirement benefits, the
payments are made according to seniority and the salary at the time of retirement, as stipulated in the Collective Labor Convention
and Agreement No. 01.



Under the post-retirement benefits plan
those workers who had met the age and continuous or discontinuous service time requirements of the law, the Collective Bargaining
Agreement in effect and/or Agreement 01 of 1977, prior to August 1, 2010, had consolidated their right to their pension with Ecopetrol.
However, it was mandatory for other workers, who were not covered, to join the General Pension System. The pension administrator
chosen by the worker (either Colpensiones or Private Pension Fund or whichever may correspond) would be responsible for recognizing
and paying the respective pension.



F-67







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Under the post-retirement benefits plan
for Ecopetrol personnel, the Company covers 90% of educational expenses for children of employees, including enrollment fees,
tuition and other associated costs. A fixed annual sum, depending on education level, is also provided for the acquisition of
textbooks. Educational coverage includes kindergarten, elementary school, high school and college. Ecopetrol ́s financial
statements must also show the cost of post-retirement educational benefits for children of retired employees, since benefits continue
irrespective of retirement or death.



According to the Collective Labor Agreement
and Agreement No. 01, the Company will pay for health services for employees and enrolled family members. Health services include:
office visits and required laboratory services, drugs, diagnostic examinations, ambulatory treatment, hospitalization due to illness
or accident, surgery due to illness or accident, maternity and rehabilitation treatments and orthopedic parts. Therefore, such
post-retirement health benefit costs are recorded in the consolidated financial statements of the Company prepared in accordance
with Colombian Government Entity GAAP, since retired workers and enrolled family members continue to receive full medical coverage.
The same is true for deceased non-retired employees.



Collective Labor Agreement expires in
June 2014. Currently Ecopetrol is negotiating with the Union representatives the new terms on this agreement. As of the filing
date there has not been any official agreement or relevant unfavorable conditions on this topic that need to be disclosed.



Under U.S. GAAP, the Company applies the
provisions of ASC 710, 715 and 835 as amended. Accordingly, the Company accrues fot its obligations under its employee defined
benefit plans, net of plan assets. The cost of defined benefit pensions and other post-employment benefits is actuarially determined
using the projected benefit method based on length of service and reflects Management’s best estimate of salary escalation,
retirement ages of employees and expected future health care costs. The expected return on plan assets is based on historical
and projected rates of return for assets in the investment plan portfolio. The actual return is based on the fair value of plan
assets. The projected benefit obligation is discounted using the market interest rate on high-quality corporate debt instruments
as at the measurement date. Actuarial gains and losses related to the change in the over-funded or under-funded status of the
defined benefit pension plan and other post-employment benefit plans are recognized in other comprehensive income.



Under Colombian law, employees are entitled
to one month salary for each year of service. This benefit is known as the “severance obligation” or “cesantias”.
This benefit accumulates during the time of employment and is paid to employees upon their termination or retirement from Ecopetrol.
However, employees may request advanced benefit payments at any time. In 1990, the Colombian government revised its labor regulations
to permit companies, subject to employee approval, to pay the severance obligation to their employees on a current basis. Law
50 of 1990 also enabled each employee to freely choose which trust fund would manage the amount accrued during each year in which
they are eligible for severance payments. This amount must be transferred by the company to the trust fund no later than February
14th in the subsequent year.



In addition, under Colombian law the Company
must pay pension bonds for certain employees when they leave Ecopetrol. Those bonds payable accrue interest at the DTF rate, according
to the class of bonds, as follows:



| | 1) | For pension bonds type B, DTF
                                         + 4%;
| | -- | ----------------------------------------------------------------------------

| | 2) | For pension bonds type A, with
                                         date of transfer before December 31, 1998, DTF + 4%;
| | -- | ----------------------------------------------------------------------------------------------------------------------------

| | 3) | For the remaining pension bonds
                                         type A, DTF + 3%.
| | -- | ------------------------------------------------------------------------------------------



The economic assumptions used in the determination
of pension obligations under U.S. GAAP differ from those used under RCP since the latter are established by Colombian regulations.



The combined costs for the above mentioned
benefit plans, determined using U.S. GAAP, for the years ended December 31, 2013, 2012 and 2011 are summarized below: (all obligations
were measured at year-end)





|                                                                  |  | 2013    |          |   | 2012                        |   |         | 2011  | 
|----------------------------------------------------------------- |  | ------- | -------- | - | --------------------------- | - | ------- | ----- | 
|Components of net periodic benefit
    costs:                     |  | Pension |          |   | Other
    
    Benefits (*) |   |         | Total | 
|Service cost                                                      |  | $       | -        |   |                             | $ | 63,742  |       | 
|Interest cost                                                     |  |         | 739,816  |   |                             |   | 402,817 |       | 
|Expected return on plan assets                                    |  |         | (592,897 | ) |                             |   | (38,922 | )     | 
|Amortization of net actuarial gain or loss                        |  |         | 31,605   |   |                             |   | 69,126  |       | 
|Net periodic pension cost under U.S. GAAP                         |  |         | 178,524  |   |                             |   | 496,763 |       | 
|Net periodic pension cost under
    Colombian GAAP (gain) or loss |  |         | -        |   |                             |   | 500,855 |       | 
|Difference to be recognized
    under U.S. GAAP (income) loss     |  | $       | 178,524  |   |                             | $ | (4,092  | )     | 









(*) Other benefits include education,
health care, pension bonds and accrued retroactive severance.



F-68







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



In 2008, Ecopetrol was approved by Colombian
Government to partially transfer its pension net liability to an autonomous trust fund. According to Colombian Government Entity
GAAP (RCP), the assets and liabilities transferred shall be accounted for in memorandum accounts, off balance sheet. This implies
that the net liability transferred is not part of the assets and liabilities of Ecopetrol instead a pension trust fund, a separate
entity not controlled by the Company. In 2012, we found a misstatement in our reconciliation to U.S. GAAP, due to we considered
the transferred assets and liabilities to be a part of the Company’s balance sheet, when reconciling our financial statements
to U.S. GAAP. According to ASC 250, we analyzed the effect of this error and conclude it did not have a material effect on previously
issued financial statements. As of December 2012, this error had a net effect on the net actuarial liability of $89,775, net after
tax. Since this is not a material misstatement, we corrected it prospectively in our 2013 financial statements.



The changes in the benefit obligations
and in plan assets for the above mentioned benefit plans, determined using U.S. GAAP, for the years end December 31, 2013 and
2012, are summarized below:



|                                                     |  | Pension Plan |             |   | Other Benefits |  
|---------------------------------------------------- |  | ------------ | ----------- | - | -------------- | -
|                                                     |  | 2013         |             |   | 2012           |  
|Reconciliation of project benefit obligation:        |  |              |             |   |                |  
|Project benefit obligation as of January 1           |  | $            | (12,179,576 | ) |                | $
|Service cost                                         |  |              | -           |   |                |  
|Interest cost                                        |  |              | (739,816    | ) |                |  
|Actuarial gain (loss)                                |  |              | 826,026     |   |                |  
|Benefit payments                                     |  |              | 670,512     |   |                |  
|Projected benefit obligation as of December 31       |  | $            | (11,422,854 | ) |                | $
|Reconciliation of plan assets :                      |  |              |             |   |                |  
|Fair value of plan assets as of January 1            |  |              | 11,122,471  |   |                |  
|Fund contribution                                    |  |              | -           |   |                |  
|Actual return on assets                              |  |              | 240,030     |   |                |  
|Benefits paid                                        |  |              | (670,512    | ) |                |  
|Fair value of plan assets as of December 31          |  | $            | 10,691,989  |   |                | $
|Net liability                                        |  |              | (730,865    | ) |                |  
|Net liability under Colombian Government Entity GAAP |  |              | -           |   |                |  
|Net effect under pension plan and other benefits     |  | $            | (730,865    | ) |                | $
|                                                     |  |              |             |   |                |  
|Amounts recognized in other comprehensive (income)   |  |              | (1,353,502  | ) |                |  



Net liability of employee benefit plans,
net of other employee benefits, is classified as follows:



|                  |  | Pension Plans |          |   | Other Benefits |   |            | TOTAL | 
|----------------- |  | ------------- | -------- | - | -------------- | - | ---------- | ----- | 
|                  |  | 2013          |          |   | 2012           |   |            | 2013  | 
|Current portion   |  | $             | -        |   |                | $ | -          |       | 
|Long-term portion |  |               | (730,865 | ) |                |   | (1,057,105 | )     | 
|Net liability     |  | $             | (730,865 | ) |                | $ | (1,057,105 | )     | 



As of December 31, 2013 and 2012, net
obligation amounts recognized in the balance sheet related to pension, health, education, bonds and severance obligations consist
of:



|                          |  | 2013 |            |   | 2012 |  
|------------------------- |  | ---- | ---------- | - | ---- | -
|Long-term liability       |  |      |            |   |      |  
|Pension                   |  | $    | (730,865   | ) |      | $
|Health care               |  |      | (4,910,787 | ) |      |  
|Education                 |  |      | (449,269   | ) |      |  
|Bonds                     |  |      | (13,183    | ) |      |  
|Severance                 |  |      | (833       | ) |      |  
|Total long-term liability |  | $    | (6,104,937 | ) |      | $



As of December 31, 2013, 2012 and 2011,
the amounts recognized in accumulated other comprehensive income, related to pension, health and education obligations consist
of:



|                                        |  | 2013 |            |   | 2012 |   |            | 2011 | 
|--------------------------------------- |  | ---- | ---------- | - | ---- | - | ---------- | ---- | 
|Other comprehensive income              |  |      |            |   |      |   |            |      | 
|Actuarial income (loss)                 |  |      |            |   |      |   |            |      | 
|Pension                                 |  | $    | (1,353,502 | ) |      | $ | (1,858,266 | )    | 
|Health care                             |  |      | (2,671,715 | ) |      |   | (3,239,842 | )    | 
|Education                               |  |      | (215,252   | ) |      |   | (213,816   | )    | 
|Bonds                                   |  |      | 1,124,927  |   |      |   | 1,102,706  |      | 
|Severance                               |  |      | 3,811      |   |      |   | 5,382      |      | 
|Total other comprehensive income (loss) |  |      | (3,111,731 | ) |      |   | (4,203,836 | )    | 
|Deferred income tax effect              |  |      | 1,026,871  |   |      |   | 1,387,266  |      | 
|Total                                   |  | $    | (2,084,860 | ) |      | $ | (2,816,570 | )    | 



F-69







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The significant variation in other comprehensive
income from 2012 to 2013 relates to Health and Pension plans due to changes in actuarial assumptions since the last actuarial
valuation.



The Company expects the following amounts
in other comprehensive income to be recognized as components of net periodic pension cost during 2014:



|            |  | Amortization |         
|----------- |  | ------------ | --------
|            |  | Gain (loss)  |         
|Pension     |  | $            | (10,989 
|Health Care |  |              | (111,345
|Education   |  |              | (8,457  
|Bonds       |  |              | 100,752 
|Severance   |  |              | -       
|Total       |  | $            | (30,039 



As of December 31, 2013 and 2012, the
amounts of gain (loss) in the year and accumulated related to pension, health, education bonds and severance consist of:



|            |  | 2013                    |         |   | 2012                   |  
|----------- |  | ----------------------- | ------- | - | ---------------------- | -
|            |  | Gain (loss) in the year |         |   | Cumulative Gain (loss) |  
|            |  |                         |         |   |                        |  
|Pension     |  | $                       | 473,159 |   |                        | $
|Health care |  |                         | 434,236 |   |                        |  
|Education   |  |                         | (9,437  | ) |                        |  
|Bonds       |  |                         | (94,583 | ) |                        |  
|Severance   |  | $                       | (1,167  | ) |                        | $



The economic assumptions adopted are shown
below in nominal terms. Those assumptions were used in determining the actuarial present value of the pension obligation and the
projected pension obligations for the plans:



|                                           |  | 2013    |      |   | 2012   | 
|------------------------------------------ |  | ------- | ---- | - | ------ | 
|                                           |  | Pension |      |   | Health | 
|Discount rate                              |  |         | 7.00 | % |        | 
|Rate of compensation and pension increases |  |         | 4.50 | % |        | 
|Expected rate of return                    |  |         | 5.50 | % |        | 
|Mortality table                            |  |         | *    |   |        | 



* Colombian Mortality Table ISS, male
and female, 2005-2008.



The actuarial assumptions of the Health
Plan have changed since the last actuarial valuation as of December 31, 2012. In 2012 we used a health cost trend rate starting
at 11.20% and grading down to general inflation +1% over 10 years. In 2013 trend rate starts at 10.40% and grades down to inflation
+ 1% in 10 years, since the most recent analyses by the health department shows a decrease tendency related to costs control initiatives
from management.



The 2011 pension bond liability was calculated
assuming that if a retired participant had not claimed his bond there was a likelihood that we would never claim it of: a) 100
% after 15 years b) 50% among 10 and 15 years, c) 25% among 5 and 10 years; and d) 0% for less than 5 years. For years 2012 and
2013 this assumption was revised assuming there was a 100% likelihood after 3 years and 0% for less than 3 years.



Estimated future benefit payments



The benefit payments, which reflect expected
future service, as appropriate, are expected to be paid as follows:



|                  |  | Pension  |           |  | Health Care |   |           | Education |  |   |               |  |  | Severance |        
|----------------- |  | -------- | --------- |  | ----------- | - | --------- | --------- |  | - | ------------- |  |  | --------- | -------
|Period            |  | Benefits |           |  | benefits    |   |           | benefits  |  |   | Pension Bonds |  |  | Plan      |        
|2014              |  | $        | 694,364   |  |             | $ | 223,937   |           |  | $ | 65,563        |  |  | $         | 54,593 
|2015              |  |          | 711,887   |  |             |   | 244,095   |           |  |   | 69,632        |  |  |           | 4,308  
|2016              |  |          | 730,665   |  |             |   | 263,490   |           |  |   | 69,082        |  |  |           | 6,799  
|2017              |  |          | 749,151   |  |             |   | 282,293   |           |  |   | 69,265        |  |  |           | 20,444 
|2018              |  |          | 767,599   |  |             |   | 300,450   |           |  |   | 67,682        |  |  |           | 31,901 
|Years 2019 – 2023 |  | $        | 4,100,967 |  |             | $ | 1,719,823 |           |  | $ | 215,127       |  |  | $         | 227,395



F-70







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



All of the benefits estimated in the table
above are to be paid from plan assets. The Company does not have any insurance policies that are intended to cover benefits that
plan participants are to receive in the future.



Furthermore, the Company does not intend
to contribute to the fund in the upcoming fiscal year. Management believes that the plan assets will provide for a sufficient
return to cover any payments that are necessary to be made in the upcoming year.



Assumed health care cost trend rates have
an effect on the amounts reported for the health care plans. A one percentage point change in assumed health care cost trend rates
would have the following effects:



|                                                        |  | 1% Percentage Point |        
|------------------------------------------------------- |  | ------------------- | -------
|                                                        |  | Increase            |        
|Effect on total of service and interest cost components |  | $                   | 63,861 
|Effect on postretirement benefit obligation             |  | $                   | 782,004



The discount rate is a critical assumption
on the actuarial calculation. The effect of variations in the projected benefit obligation by plan is as follows:



|                   |  | % point   |     |   |          |   |          |          | 
|------------------ |  | --------- | --- | - | -------- | - | -------- | -------- | 
|                   |  | variation |     |   | Increase |   |          | Decrease | 
|Pension plan       |  |           | 0.5 | % |          | $ | (646,611 | )        | 
|Medical plan       |  |           | 1.0 | % |          |   | (637,237 | )        | 
|Education plan     |  |           | 0.5 | % |          |   | (13,198  | )        | 
|Pension Bonds plan |  |           | 0.5 | % |          |   | (42,398  | )        | 
|Severance plan     |  |           | 0.5 | % |          | $ | (152     | )        | 



Plan assets



Medical, Education and Severance plans
are unfunded. Pension and pension bonds plans are covered by assets in five trust funds with the following investment allocation:



|Investment                                  |  | 2013 |            |  | 2012 | 
|------------------------------------------- |  | ---- | ---------- |  | ---- | 
|                                            |  |      |            |  |      | 
|Colombian Government treasury bonds (TES)   |  | $    | 4,311,575  |  |      | 
|Non-governmental entity bonds               |  |      | 3,567,065  |  |      | 
|Other securities in COP                     |  |      | 2,038,017  |  |      | 
|Other bonds                                 |  |      | 864,917    |  |      | 
|Other securities in foreign currency        |  |      | 389,416    |  |      | 
|Foreign countries government treasury bonds |  |      | 196,404    |  |      | 
|Variable yield investments and other        |  |      | 82,948     |  |      | 
|Total                                       |  | $    | 11,450,342 |  |      | 



The plan assets do not contain any shares
of stock of Ecopetrol or any of its related parties. However it includes bonds issued by the Company, representing 1.0% of fund
investments. There is no significant risk concentrations within the plan assets.



The fair value of plan asset is calculated
using quoted market prices in active markets. The company obtains these quoted prices from renowned trustworthy financial data
providers in Colombia or abroad depending on the investment. For those portfolio items not having a quoted price the Company uses
an income approach technique capturing observable market data. Our fair value measurements do not use any unobservable inputs
for significant valuations.



Decree 1861 of 2012 establishes the investment
regime for trust funds guaranteeing pension plans of governmental entities, whose precepts are intended to bear a moderate risk.
Assets fund investment decisions are made accordingly, following, among other, the following restrictions:



| | - | Investments in public debt shall not
                                         exceed 50% of fund assets value.
| | - | --------------------------------------------------------------------------------------------------------------

| | - | Investments in joint portfolios, limited
                                         to 5% of fund assets value, are allowed only if its index is representative of general
                                         market behavior, and is not related to specific economic sectors or specific issuers.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | - | Investments in funds representing a
                                         foreign index are limited to 5% of fund assets.
| | - | ----------------------------------------------------------------------------------------------------------------------------

| | - | Investments in Ecopetrol S.A. shares
                                         are allowed.
| | - | ------------------------------------------------------------------------------------------

| | - | Forbidden investments:
| | - | ----------------------

| | o | Shares of foreign companies or securities
                                         representing these shares.
| | - | -------------------------------------------------------------------------------------------------------------

| | o | Asset-backed securities different
                                         from mortgage-backed securities.
| | - | -----------------------------------------------------------------------------------------------------------

| | o | Private capital funds.
| | - | ----------------------

| | o | Investments regarding related parties
                                         of the trust fund manager.
| | - | ---------------------------------------------------------------------------------------------------------



F-71







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



|vii. | PROVISIONS
    AND CONTINGENCIES
|---- | --------------------------------



For U.S. GAAP, Accounting for Contingencies
(ASC 450), provides guidance for recording contingencies. Under ASC 450, there are three levels of assessment of contingent events
– probable, reasonably possible and remote. The term probable in ASC 450 is defined as “the future event or events
that are likely to occur”. The term reasonably possible is defined as “the chance of the future event or events occurring
is more than remote but less than likely”. While the term remote is defined as “the chance of the future event
or events occurring is slight”.



Under ASC 450, an estimated loss related
to a contingent event shall be accrued by a charge to income if both of the following conditions are met:



|• | Information
    available prior to issuance of the financial statements indicates that it is probable that an asset had been impaired or a
    liability had been incurred at the date of the financial statements
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                   
|• | The
    amount of loss can be reasonably estimated.                                                                                                                                                               



The amount recorded is an estimate of
the amount of loss at the date of the financial statements. If the contingent event is evaluated to be reasonably possible, no
provision for the contingent event may be made, but disclosure of the event is required with amount of loss that is reasonably
possible.



As a result of the difference in the definition
of “probable” between Colombian Government Entity GAAP and U.S. GAAP, and the general interpretation of the definition
in practice in Colombia, there is a difference in the amount of the provision for legal proceedings.



Under Colombian Government Entity GAAP,
it is required to recognize additional provisions regarding to capitalize the pension assets. According to Colombian actuarial
assumptions, we estimate the difference between pension assets and liabilities, and accrued a provision due to capitalize the
five trusts funds during 2014. Under U.S. GAAP, the estimates is write-off due to the explanation showed at note vi. Employee
benefit plans.

The effects of these adjustments in the
reconciliation of income were $802,341; $141,755 and $335,983 in December 2013, 2012 and 2011, respectively.



The effects of these adjustments in the
reconciliation of consolidated shareholders ́ equity were $1,294,564 and 492,223 in December 2013 and 2012, respectively.



|viii. | ASSETS
    AND LIABILITIES PRESENT VALUE
|----- | ----------------------------------------



Under Colombian government Entity GAAP,
accounts receivable and payable are recognized at amortized cost, represented by any uncollected or unpaid balances, regardless
if such balances are due within the year or not. For U.S. GAAP purposes, the Company measures the long-term balances at present
value by discounting future cash flows at the appropriate discount rate. Such balance is amortized using the effective interest
method.



The estimated discount rate for long-term
liability is based on the Colombian Government Treasury bonds as it was considered that the Company has a similar credit risk.



As a result of the measurement of the
Equity Tax liability and after minor adjustments recognized by Ecopetrol and its subsidiaries in the year 2013, 2012 and 2011,
an adjustment for $39,029, $(99,188), and $126,861 respectively was recorded.



|ix. | DEFERRED
    INCOME TAXES
|--- | -------------------------



Under U.S. GAAP a valuation allowance
is provided for deferred tax assets to the extent that it is more likely than not that they will not be realized.



Under Colombian Government Entity GAAP,
deferred income taxes are calculated using the current statutory tax rate. Under U.S. GAAP, deferred income taxes are calculated
based on rates and tax laws enacted at the reporting date considering the future tax rate that will apply when the deferred income
tax difference will be realized.



All of the income tax effects in the U.S.
GAAP reconciliation are the tax effect of pretax adjustments, and none relate to differences between the accounting for income
tax standards.



The Company and its subsidiaries file
separate income tax returns since tax regulations do not allow consolidated income tax returns. There are no requirements to file
tax returns by segments. Tax returns for each legal entity are required. The tax rate of Refineria de Cartagena S.A. Bioenergy
and Comai is 15% because they are located he free trade zone until 2023, 2025 and 2021, respectively. The tax savings for the
last three years has not been significant.



F-72







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Taxable loss carry forwards will be deductible
in future years, and will depend on the countries’ specific tax regulations. As of December 31, 2013, Ecopetrols’
subsidiaries had accumulated tax loss carry-forwards and excesses of presumptive income generated in previous years, as follows:



|Expiration date             |  |                     |           |  | Deferred   |   |           | Excess of       |  |   | Deferred   | 
|--------------------------- |  | ------------------- | --------- |  | ---------- | - | --------- | --------------- |  | - | ---------- | 
|                            |  | Loss carry-forwards |           |  | Income Tax |   |           | presumed income |  |   | Income Tax | 
|2012                        |  | $                   | -         |  |            | $ | -         |                 |  | $ | 369        | 
|2013                        |  |                     | -         |  |            |   | -         |                 |  |   | 63,677     | 
|2014                        |  |                     | 7,964     |  |            |   | 30        |                 |  |   | 77,982     | 
|2015                        |  |                     | -         |  |            |   | -         |                 |  |   | 59,092     | 
|2016                        |  |                     | -         |  |            |   | -         |                 |  |   | 37,407     | 
|2017                        |  |                     | -         |  |            |   | -         |                 |  |   | 33,896     | 
|2018                        |  |                     | -         |  |            |   | -         |                 |  |   | 29,234     | 
|2019                        |  |                     | -         |  |            |   | -         |                 |  |   | 3,258      | 
|With no Maximum expiry date |  |                     | 4,264,932 |  |            |   | 1,247,914 |                 |  |   | -          | 
|                            |  | $                   | 4,272,896 |  |            | $ | 1,247,944 |                 |  | $ | 304,915    | 



Tax reform



The Colombian Congress of the Republic
adopted Law 1607 of December 26, 2012, which introduces significant reforms to the Colombian tax system, in particular, the income
tax rate was reduced from 33% to 25% starting in 2013, and the Equality Income Tax (Impuesto de Renta para la Equidad - CREE),
was created with a rate of 9% from 2013 to 2015 and 8% starting in 2016; there are some differences between the treatment used
to determine this tax and the one used to determine ordinary income tax.



The following information regarding income
taxes has been prepared under U.S. GAAP:



Income Taxes



Total income taxes for the years ended
December 31, 2013, 2012 and 2011 were comprised as follows:



|                                                                 |  | 2013 |           |   | 2012 |   |           | 2011 | 
|---------------------------------------------------------------- |  | ---- | --------- | - | ---- | - | --------- | ---- | 
|Income tax expense                                               |  | $    | 8,774,819 |   |      | $ | 7,525,988 |      | 
|Income tax effects based on items of other comprehensive income: |  |      |           |   |      |   |           |      | 
|Pension plan liability                                           |  |      | 360,395   |   |      |   | 28,321    |      | 
|Available-for-sale securities                                    |  |      | (47,894   | ) |      |   | (27,721   | )    | 
|                                                                 |  | $    | 9,087,320 |   |      | $ | 7,526,588 |      | 



Income tax expense attributable to income
from continuing operations consists of:



|                  |  | 2013 |           |  | 2012 |   |           | 2011 | 
|----------------- |  | ---- | --------- |  | ---- | - | --------- | ---- | 
|Current provision |  | $    | 8,291,571 |  |      | $ | 7,095,874 |      | 
|Deferred tax      |  |      | 483,248   |  |      |   | 430,114   |      | 
|                  |  | $    | 8,774,819 |  |      | $ | 7,525,988 |      | 



In 2013, 2012 and 2011, there are foreign
subsidiaries that do not pay income taxes and therefore do not generate income tax expense or deferred tax effects. The entities
that paid taxes and currently do not generate taxable income recorded valuation allowances against any deferred tax asset previously
recorded.



Amount of foreign and domestic pretax
income:



|                         |  | 2013 |            |  | 2012 |   |            | 2011 | 
|------------------------ |  | ---- | ---------- |  | ---- | - | ---------- | ---- | 
|Domestic pretax income   |  | $    | 22,692,204 |  |      | $ | 21,083,067 |      | 
|Foreign pretax income    |  |      | 569,160    |  |      |   | 1,330,415  |      | 
|Income before income tax |  | $    | 23,261,364 |  |      | $ | 22,413,482 |      | 



Unremitted earnings accumulated as of
December 31, 2013 of certain international subsidiaries totaling $1,841,175 are permanently invested. No deferred tax liability
was recognized for the remittance of such earnings. The income tax liability that might be incurred if such earnings were remitted
to Colombia is not practicable to estimate.



F-73







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Tax Rate Reconciliation



Income tax expense attributable to income
from continuing operations was $8,774,819, $7,525,988, and $8,399,086, for the years ended December 31, 2013, 2012 and 2011, respectively,
and differed from the amounts computed by applying the statutory income tax rate for Colombian entities that is 34% in 2013 and
33% , in 2012 and 2011, to pretax income from continuing operations as follows:



|                                                       |  | 2013 |       |    | 2012 |  |       | 2011 | 
|------------------------------------------------------ |  | ---- | ----- | -- | ---- |  | ----- | ---- | 
|Statutory income tax                                   |  |      | 34.00 | %  |      |  | 33.00 | %    | 
|Non – taxable income (exempt domestic dividend income) |  |      | (0.36 | )% |      |  | 0.04  | %    | 
|Non – deductible expenses                              |  |      | 3.03  | %  |      |  | 0.28  | %    | 
|Other exempt income                                    |  |      | -     |    |      |  | (0.30 | )%   | 
|Income taxable at other tax rate                       |  |      | 0.19  | %  |      |  | 0.60  | %    | 
|Changes in tax rate                                    |  |      | (0.03 | )% |      |  | 0.11  | %    | 
|Others                                                 |  |      | 0.89  | %  |      |  | (0.15 | )%   | 
|Effective income tax under U.S. GAAP                   |  |      | 37.72 | %  |      |  | 33.58 | %    | 



Ecopetrol S.A. has no unrecognized tax
benefits. The tax years open to the taxation authorities’ reviews by major components are as follows:



|Company                     |  | Tax
    years   
|--------------------------- |  | ----------------
|Bioenergy                   |  | 2010
    to 2013
|Cenit                       |  | 2012            
|Comai                       |  | 2011
    to 2013
|Equion                      |  | 2010
    to 2012
|Hocol                       |  | 2010
    to 2012
|Propilco                    |  | 2011
    to 2013
|Reficar                     |  | 2007
    to 2012
|Oleoducto
    de los Llanos |  | 2009
    to 2012
|Oleoducto
    Bicentenario  |  | 2010
    to 2012
|Oleoducto
    de Colombia   |  | 2008
    to 2013
|Ocensa                      |  | 2010
    to 2013
|Perú                        |  | 2009
    to 2013



The Company is subject to income taxation
in many jurisdictions around the world. Unrecognized tax benefits reflect the difference between positions taken or expected to
be taken on income tax returns and the amounts recognized in the financial statements.



We recognize interest accrued related
to an underpayment of income taxes in interest expense. Penalties, if recognized, would be presented as a component of other expense.



F-74









Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Deferred Taxes



The significant components of deferred
income tax expense attributable to income from continuing operations for the years ended December 31, 2013, 2012 and 2011
are as follows:



|                                                                                             |  | 2013 |          |   | 2012 |   |          | 2011 | 
|-------------------------------------------------------------------------------------------- |  | ---- | -------- | - | ---- | - | -------- | ---- | 
|Deferred income tax expense (exclusive of the effects of other components below):            |  |      |          |   |      |   |          |      | 
|Accounts payable                                                                             |  | $    | (64,485  | ) |      | $ | 100,511  |      | 
|Inventories                                                                                  |  |      | 314      |   |      |   | (5,967   | )    | 
|Property, plant and equipment, principally due to DD&A                                       |  |      | (123,172 | ) |      |   | 78,201   |      | 
|Deferred charges                                                                             |  |      | (13,357  | ) |      |   | (11,185  | )    | 
|Prepaid expenses                                                                             |  |      | 161      |   |      |   | (75      | )    | 
|Capital lease asset                                                                          |  |      | (43,086  | ) |      |   | 83,829   |      | 
|Monetary correction and other                                                                |  |      | 84,370   |   |      |   | (275,294 | )    | 
|DD&A and inflation adjustments                                                               |  |      | 191,961  |   |      |   | 310,351  |      | 
|Investment                                                                                   |  |      | (236,500 | ) |      |   | (352,018 | )    | 
|Direct finance lease                                                                         |  |      | 44,847   |   |      |   | (39,922  | )    | 
|Estimated liabilities and provisions                                                         |  |      | (101,425 | ) |      |   | (73,955  | )    | 
|Accounts and notes receivable                                                                |  |      | (80,492  | ) |      |   | (6,194   | )    | 
|Carry forward loss                                                                           |  |      | (914,601 | ) |      |   | (159,549 | )    | 
|Pension and benefits obligations                                                             |  |      | 363,630  |   |      |   | (56,941  | )    | 
|Deferred income                                                                              |  |      | -        |   |      |   | -        |      | 
|Natural and environmental resources capitalized expenses                                     |  |      | 667,635  |   |      |   | 381,072  |      | 
|Valuation allowance                                                                          |  |      | 304,623  |   |      |   | 604,394  |      | 
|Additional tax discount on the acquisition of productive assets according
    to ASC 740 (1) |  |      | (15,114  | ) |      |   | 534      |      | 
|Excess in presumptive income tax                                                             |  |      | 641,773  |   |      |   | (373,085 | )    | 
|Other                                                                                        |  |      | (88,861  | ) |      |   | 37,608   |      | 
|Amortization of actuarial loss recorded in OCI                                               |  |      | (360,395 | ) |      |   | 28,321   |      | 
|Unrealized loss in available for sale securities                                             |  |      | 47,894   |   |      |   | (27,721  | )    | 
|Amortization of fiscal goodwill according to ASC 350                                         |  |      | 177,527  |   |      |   | 187,199  |      | 
|                                                                                             |  | $    | 483,247  |   |      | $ | 430,114  |      | 



|(1) | This value corresponds to the deferred tax generated by the calculation of ASC
    740, due to the implementation of the special deduction for investment in real productive assets.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-75







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The tax effects of temporary differences
that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2013 and 2012
are presented below:



|                                                                                                   |  | 2013 |            |   | 2012 |  
|-------------------------------------------------------------------------------------------------- |  | ---- | ---------- | - | ---- | -
|Deferred income tax assets and liabilities                                                         |  |      |            |   |      |  
|Deferred income tax assets:                                                                        |  |      |            |   |      |  
|Inventories                                                                                        |  | $    | 39,572     |   |      | $
|Investments                                                                                        |  |      | 195,808    |   |      |  
|Accounts and notes receivable                                                                      |  |      | 97,920     |   |      |  
|Property, plant and equipment, principally due to DD&A                                             |  |      | 3,263,018  |   |      |  
|Deferred charges                                                                                   |  |      | 41,706     |   |      |  
|Prepaid expenses                                                                                   |  |      | 9          |   |      |  
|Financial obligation, principally due to capitalized leasing                                       |  |      | 105,882    |   |      |  
|Pension obligations                                                                                |  |      | 740,525    |   |      |  
|Accounts payable                                                                                   |  |      | 234,561    |   |      |  
|Carry forward loss (1)                                                                             |  |      | 1,247,945  |   |      |  
|Excess in presumptive income tax (2)                                                               |  |      | 49,406     |   |      |  
|Other                                                                                              |  |      | (7,813     | ) |      |  
|Amortization of fiscal goodwill according to ASC 830                                               |  |      | 206,734    |   |      |  
|Estimated liabilities and provisions                                                               |  |      | 1,020,194  |   |      |  
|Total gross deferred income tax assets                                                             |  |      | 7,235,467  |   |      |  
|Less valuation allowance (3)                                                                       |  |      | (1,131,236 | ) |      |  
|Deferred income tax assets                                                                         |  |      | 6,104,231  |   |      |  
|Deferred income tax liabilities                                                                    |  |      |            |   |      |  
|Accounts and notes receivable                                                                      |  |      | 10,532     |   |      |  
|Natural and environmental properties due to the difference between the methods
    of amortization |  |      | 2,582,791  |   |      |  
|Monetary correction and other                                                                      |  |      | 590,158    |   |      |  
|DD&A and inflation adjustments                                                                     |  |      | 1,383,011  |   |      |  
|Investments                                                                                        |  |      | 403,910    |   |      |  
|Direct finance lease                                                                               |  |      | 44,847     |   |      |  
|Deferred income tax liabilities                                                                    |  |      | 5,015,249  |   |      |  
|Net deferred income tax assets                                                                     |  | $    | 1,088,982  |   |      | $



The realizability of the net deferred
tax assets detailed above is expected given that it is more likely than not that the results of future operations will generate
sufficient taxable income to realize the deferred tax. For those which realizability is in question valuation allowances have
been provided.



|(1) | Carry forwards losses are
    generated by subsidiaries and according to local tax laws, these losses do not expire.                                                                                                                 
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                      
|(2) | The excess in presumptive income tax
    are generated by subsidiaries and will expire in 5 years.                                                                                                                                   
|    |                                                                                                                                                                                                                                      
|(3) | The changes in the valuation allowances
    are mainly due to 2013 tax losses  originated by Ecopetrol do Brazil, Ecopetrol America Inc., Ecopetrol del Perú,
    Bioenergy and Refineria de Cartagena $1,092,621 as detailed bellow:



|                       |  | 2013 |           |  | Variation |   |         | 2012 | 
|---------------------- |  | ---- | --------- |  | --------- | - | ------- | ---- | 
|Ecopetrol do Brazil    |  | $    | 306,215   |  |           | $ | 57,224  |      | 
|Ecopetrol del Peru     |  |      | 57,223    |  |           |   | 10,330  |      | 
|Bioenergy              |  |      | 463       |  |           |   | -       |      | 
|Ecopetrol America Inc. |  |      | 746,000   |  |           |   | 225,138 |      | 
|Refineria de Cartagena |  |      | 21,335    |  |           |   | 11,931  |      | 
|                       |  | $    | 1,131,236 |  |           | $ | 304,623 |      | 



|x. | REVENUE RECOGNITION
|-- | -------------------



| | a.1 | Over and under deliveries
| | --- | -------------------------



Under Colombian Government Entity GAAP,
the Company recognizes receivables from or payables to partners and to pipeline companies based on the cost of the inventory.



For U.S. GAAP purposes, the Company utilizes
the entitlement method of accounting for over and under positions by which the amount of crude oil sold is based on its shared
interest in the properties, and revenue is recognized based on market prices. The pipeline imbalances determined through volume
allocation are recorded as either receivables or payables as per ASC 932-10-S99-5 valued at selling prices.



The Company’s crude oil under balance
position at December 31, 2013 was $119,010 and at December 31, 2012 was $221,350 and at December 31, 2011 was $659,535
equivalent to 662,545, 968,656 and 4,184,690 barrels, respectively.



F-76







S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011





| | a.2 | Cost of Sales
| | --- | -------------



Under U.S. GAAP, the related cost of sale
in the reconciliation of net income for over and under deliveries transactions described at a.1 above amounted to $296,317, $208,644
and $(449,225) during 2013, 2012 and 2011, respectively, in comparison with the amount recognized under Colombian Government Entity
GAAP.



| | a.3 | Net vs. Gross sales
| | --- | -------------------



The Company the sales transactions where
it transports crude oil, from the supplier to the customer, using its pipelines. For U.S. GAAP purposes, when price is fixed,
there are no changes made to the product and the Company has no physical inventory loss risk, among other criteria, the Company
records such sales on a net basis. Under Colombian Government Entity GAAP, such crude oil sales are recognized gross.



|xi. | INFLATION ADJUSTMENTS
|--- | ---------------------



The Colombian Government Entity GAAP consolidated
financial statements were adjusted for inflation based on the variation in the IPC (Colombia’s equivalent to the consumer
price index in the United States) for middle income-earners from January 1, 1992 to December 31, 2001 for Ecopetrol S.A. and from
January 1, 1992 to December 31, 2006 for Oleoducto de Colombia S.A. (ODC), Hocol S.A., Oleoducto Central S.A. (Ocensa), Equion,
and Reficar S.A. The adjustment was applied monthly to non-monetary assets, equity (except for the valuation surplus) and memorandum
accounts.



Under U.S. GAAP, the aforementioned adjustments
under Colombian Government Entity GAAP are not applicable and have been reversed.



|xii. | INVENTORIES
|---- | -----------



Under Colombian Government Entity GAAP,
inventories are valued at the lower of average cost or sale price. Under U.S. GAAP, inventories are valued at the lower of
average cost or market value, the determination of which can be made using several different methods acceptable under U.S. GAAP. An
adjustment has been recorded to reflect the difference in the method used to determine the valuation of inventories that arises
from using sale price instead of market value, as defined by U.S. GAAP. Inventories are also affected by the effect of adjustments
to cost of sales included in this reconciliation. These adjustments are related to depreciation, capitalized expenses in property,
plant and equipment, asset retirement cost and impairment of long-lived assets.



The effects of this adjustment (loss)
gain in the reconciliation of income were $30,289, $(16,699) and $76,126 in December 2013, 2012 and 2011, respectively.



The effects of these adjustments in the
reconciliation of equity and the corresponding effect in inventory were $(18,410) and $(55,078) at December 31, 2013 and 2012,
respectively.



|xiii. | LEASE ACCOUNTING
|----- | ----------------



Under both Colombian Government Entity
GAAP and U.S. GAAP there are, lessee accounting for capital leases and operating leases. However, the tests used to determine
if a lease is a capital or an operating lease differs between Colombian Government Entity GAAP and U.S. GAAP. In applying
the tests in accordance with Colombian Government Entity GAAP, the Company has determined that all leases are operating leases. Under
U.S. GAAP some of these leases should be accounted for as capital leases in accordance with ASC 840-10. As a result, adjustments
were recorded to reflect the related assets and liabilities, and to recognize interest expense and de-recognize operating expenses
associated with the lease payments.



Embedded Leasing



Under Colombian Government Entity GAAP,
there is no requirement to identify whether the arrangements or contracts contain leases.



Under U.S. GAAP, an arrangement contains
a lease if both of the following criteria are met:



|1. | The arrangement depends
    on a specific fixed asset, either identified contractually or implicitly identified as no alternative item could feasibly
    be used.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------



|2. | The purchaser has the right
    to control the use of the underlying fixed asset, such control demonstrated by the existence of any of the following qualitative
    conditions:
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) | The purchaser can operate
    the asset or direct others to operate the asset while obtaining or controlling more than a minor amount of the asset’s
    output;
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------



F-77







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



| | b) | The purchaser can control
    physical access to the asset while obtaining or controlling more than a minor amount of the asset’s output; or
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                             
| | c) | Probability is remote that another
    party will take more than minor amount of the asset’s output and the price is not fixed per unit.    



Under U.S. GAAP, if the arrangement contains
a lease, ASC 840 is applied by both purchaser and supplier for recognition, measurement, classification and disclosure purposes.



Build, Operate, Maintain and Transfer
(BOMT)





|Future Payments     |  | Ecogas (1) - ECP |      |  | Termo ERB (2)  -
    ODL |   |         | Termo Servicios (2) -
     ODL |  |   | Termo Proyectos (2)  -
     ODL | 
|------------------- |  | ---------------- | ---- |  | ------------------------ | - | ------- | ------------------------------ |  | - | ------------------------------- | 
|Year                |  | USD  (million)   |      |  | Pesos                    |   |         | USD  (million)                 |  |   | Pesos                           | 
|2014                |  | $                | 17.0 |  |                          | $ | 32,731  |                                |  | $ | 2.7                             | 
|2015                |  |                  | 17.0 |  |                          |   | 32,731  |                                |  |   | 2.7                             | 
|2016                |  |                  | 16.2 |  |                          |   | 31,269  |                                |  |   | 2.7                             | 
|2017                |  |                  | 10.4 |  |                          |   | 19,993  |                                |  |   | 2.7                             | 
|Payments after 2018 |  |                  | -    |  |                          |   | -       |                                |  |   | 8.8                             | 
|                    |  | $                | 60.6 |  |                          | $ | 116,724 |                                |  | $ | 19.6                            | 





In 2010, we entered in a new BOMT, corresponding
to the gas treatment plant located in the Dina-Tello field with an estimated value of construction US$28 million. This BOMT is
accounted as capital lease in accordance with ASC 840 such as the contracts described previously, this contract had an original
term of 8 years, ending in 2017.



Ecopetrol entered into a contract with
Unión Temporal Gas Gibraltar firm to advance the design, build, operation and maintenance of a treatment plant with 30
mpcd capacity. Likewise, we entered into a contract with Natural Gas E.S.P for marketing purposes. The Gibraltar gas processing
plant is located between the cities of Toledo (Norte de Santander) and Cubará (Boyacá). This BOMT is accounted as
a capital lease in accordance with ASC 840. This contract had original term of 15 years, ending in 2026.



Since 2012, the gas treatment plant located
in Dina- Tello field, and the contracts with Unión Temporal Gas Gibraltar were recognized in our local financial statements,
as a result of an internal consistency process between local and U.S. GAAP requirements.



| | (1) | Three original leases that
    were accounted for as capital leases under U.S. GAAP are BOMT contracts, the use of which are specifically required under
    Colombian law for projects that involve the building, operating, maintaining and transferring of natural gas pipelines for
    the transportation of natural gas.  These contracts had original terms of 20 years, no renewal provisions, and a
    purchase option.  The rights to the leased assets were subsequently transferred to a related Company (ECOGAS) that
    was sold, but Ecopetrol was not relieved of the primary obligation under the original lease.  This transfer was
    considered a sublease accounted for as a direct finance lease.  In 2007, Ecopetrol received a prepayment of all
    amounts to be received during the term of the sublease contract.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | ODL signed three agreements for
        the acquisition of energy conversation assets to meet the needs of power consumption of the booster stations ER1, ER2
        and Rubiales field.
        
        The assets will be owned by ODL
        if the purchase option is exercised during the term or at the end the contract. However, ODL has the alternative of not
        exercising the purchase option, in which case the assets will be removed by the Contractor.
        
        Under U.S. GAAP these contacts
        were accounted for by ODL as finance leases registering the present value of the corresponding assets and liabilities
        net of amortization
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|xiv. | PROPERTY, PLANT AND EQUIPMENT
|---- | -----------------------------



Under Colombian Government Entity GAAP,
property, plant and equipment are recorded at cost and are adjusted for inflation until 2001. The cost includes administrative
expenses until 2004, financial expenses and exchange differences from foreign currency financing until the asset is placed in
service. Normal disbursements for maintenance and repairs are charged to expense and those significant costs that improve efficiency
or extend the useful life are capitalized. Under U.S. GAAP, cost includes expenditures until the asset is placed in service such
as installation cost, freight, interest, retirement cost; construction cost and other direct expenses are capitalized, with exception
of adjustment for inflation and foreign currency loss. For U.S. GAAP purposes, administrative expenses capitalized were eliminated
from property, plant and equipment. In addition, a deferred income tax asset resulted from the application of the provisions of
ASC 740-10, Accounting for Acquired Temporary Differences in Certain Purchase Transactions that are not Accounted for as Business
Combinations, since the investment in real productive assets creates an additional tax deduction of 30% in 2010. Starting
in January 2011, income tax deductions from investments in said asset are no longer be available.



F-78







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The following table reflects the net changes
in capitalized exploratory wells during 2013 and 2012. It does not include amounts that were capitalized and recorded as expenses
during the same period under the successful efforts method.



|                                                                                                       |  | 2013 |           |   | 2012 |  
|------------------------------------------------------------------------------------------------------ |  | ---- | --------- | - | ---- | -
|Opening balance at January 1                                                                           |  | $    | 1,427,947 |   |      | $
|Additions to capitalized exploratory well costs                                                        |  |      | 1,456,994 |   |      |  
|Reclassifications to wells, facilities and equipment based on the determination of proved
    reserves |  |      | (136,747  | ) |      |  
|Capitalized exploratory well costs charged to expense*                                                 |  |      | (394,372  | ) |      |  
|Ending balance at December 31                                                                          |  | $    | 2,353,822 |   |      | $



* Includes $110,327 and $10,748 of capitalized
exploratory well costs at December 31, 2013 and 2012 respectively, which were declared as dry wells during 2014 and 2013, respectively.



Accounting For Suspended Exploratory
Wells



The following table represents a classification
by ages for constructions in progress based on the drilling completion date and the number of projects that are in ongoing drilling
for a period exceeding one year as from the completion date.



|                                  |  | 2013 |         |  | 2012 |  
|--------------------------------- |  | ---- | ------- |  | ---- | -
|Between 1 and 3 years (a)         |  | $    | 400,276 |  |      | $
|Between 3 and 5 years (b)         |  |      | 53,028  |  |      |  
|More than 5 years (c)             |  |      | 33,521  |  |      |  
|Total suspended exploratory wells |  | $    | 486,825 |  |      | $
|No. of projects exceeding 1 year  |  |      | 26      |  |      |  



| | (a) | Corresponds to 9 projects of Ecopetrol,
                                         3 projects of Ecopetrol America Inc. and 14 projects of Hocol that are pending project
                                         tradability statement or that are temporarily closed due to environmental issues.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | For 2013, it corresponds to well
                                         Oripaya 1 which was temporarily abandoned. It will be reactivated when required as a
                                         producing well after conducting workover procedure. For 2012, it corresponds to well
                                         Rio Zulia West 3 which is a producing well and was pending license from the National
                                         Hydrocarbons Agency.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | Corresponds to Huron-1 well closed
                                         because it is not connected to production facilities. There is a currently development
                                         project to connect at the facilities of the Piedemonte contract, because the size and
                                         Huron’s economy do not support an independent development. We expect to start production
                                         in 2016.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a. | Interest
| | -- | --------



Under Colombian Government Entity GAAP,
all interest paid net of interest income is subject to capitalization regardless of the utilization of the funds. Exchange rate
differentials are also capitalized as part of the asset. The Company ́s assessment of the methodology followed to determine
the capitalization amount under U.S. GAAP considered more detailed information available to estimate the interest to be capitalized.
The Company obtained detail of the assets associated to the debt and is able to apply the analysis and calculations based
on each project, providing further detail of interest capitalized.



The total interest capitalized during
2013 under Colombian Government Entity GAAP was $637,043 and the total interest capitalized under U.S. GAAP was $156,530. The
effect of this adjustment in the reconciliation of income was $480,513 The total interest capitalized during 2012 under Colombian
Government Entity GAAP was $761,199 and the total interest capitalized under U.S. GAAP was $153,999. The effect of this adjustment
in the reconciliation of income was $607,200. The total interest capitalized during 2011 under RCP was $207,514 and the total
interest capitalized under U.S. GAAP was $85,337. The effect of this adjustment in the reconciliation of income was $122,177.



| | b. | Impairment
| | -- | ----------



Under Colombian Government Entity GAAP, technical appraisals for property, plant and equipment are performed
at least every three years. If the technical study is lower than the carrying value, the difference is recorded in equity as a
reduction of the property, plant and equipment carrying value even if it reduces the valuation surplus below zero. Under U.S. GAAP,
in accordance with ASC 360-10, Property, Plant, and Equipment - Impairment or Disposal of Long-Lived Assets (ASC 360-10), property,
plant, and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount
of an asset may not be recoverable. If circumstances require a long-lived asset to be tested for possible impairment, the Company
first compares undiscounted cash flows expected to be generated by the asset to the carrying value of the asset. If the carrying
value of the long-lived asset is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent
that the carrying value exceeds its fair value. Fair value is determined through discounted cash flow models. For U.S. GAAP purposes,
the Company reviewed property, plant and equipment for impairment as of December 31, 2013, 2012, 2011, and recorded impairment
losses when required.



F-79







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



For U.S. GAAP purposes, the Company recorded
an impairment loss of $45,620 in 2013 related to the decrease of reserves estimate revision. In 2012, the company recognized an
impairment loss of $276,145, $80,242 corresponding to production fields and $195,903 related to pipeline transportation systems.
$136,357 in 2011, as additional impairment charges to reduce the net book value of certain field assets and pipelines to their
estimated fair values.



| | c. | Revaluation of property,
                                         plant and equipment and public accounting effect
| | -- | ------------------------------------------------------------------------------------------------------------------



Under Colombian Government Entity GAAP
valuation surplus of property, plant and equipment and public accounting effect correspond to the difference between net book
value and the market value for real estate or the current value in use for property, plant and equipment, determined by specialists.
These accounts are reflected as valuations and as valuation surplus from reappraisals of assets and the public accounting effect
(components of equity) in the Company’s consolidated balances sheets. The last valuation was in December 2013. Technical
appraisals are valid for three years.



Under U.S. GAAP, the valuation surplus
of assets and the public accounting effect are not permitted.



|xv. | DEPRECIATION, DEPLETION
    AND AMORTIZATION
|--- | --------------------------------------------



Under Colombian Government Entity GAAP,
all tangible equipment, including those used in crude oil and natural gas, exploration and development, are depreciated on a straight-line
basis over the related estimated useful lives. Intangible crude oil and natural gas assets reflected on the Company’s consolidated
balance sheets as natural and environmental resources are depleted on a units-of-production basis.



In the case of HOCOL, all tangible and
intangible assets used in the production of crude and natural gas production are depreciated or depleted using the units of production
method, using developed proved reserves, except for the pipeline asset which is depreciated on a straight-line basis over the
related estimated useful life (20 years). For REFICAR, in the case of the unit “Viscorreductora”, this is depreciated
based on a 4 year life on a straight line basis, ending in December 2013. For BIOENERGY, in relation to agricultural sugarcane
crops, the company develops the plantations that it will use as base for the production of Bioethanol. The cost of the agricultural
plantations will be amortized during productive cycle time frame, using a method at recognized technical value.



Under U.S. GAAP, all assets, including
tangible equipment, used in crude oil and natural gas producing activities are required to be depreciated or depleted using a
units-of-production method, using proved reserves calculated in accordance with SEC requirements. Therefore, an adjustment to
net income per U.S. GAAP has been recorded to account for the difference in depreciation, depletion and amortization expense based
on the above-described differences in the methods used. In addition, the financial statements reflect the amortization of those
assets affected by the application of ASC 740-10, Accounting for Acquired Temporary Differences in Certain Purchase Transactions
That Are Not Accounted for as Business Combinations. Therefore, an adjustment to net income per U.S. GAAP has been recorded
to account for the difference in depreciation, depletion and amortization expense.



|xvi. | ASSET RETIREMENT OBLIGATIONS
|---- | ----------------------------



Under Colombian Government Entity GAAP,
the Company updates annually the analysis of the estimated liability for future asset retirement obligations as of each balance
sheet date. The liability is adjusted to the current value and an offsetting amount is recorded as an adjustment to the asset
cost.



For purposes of U.S. GAAP reporting, the
Company follows the provisions of Accounting Standards Codification ASC 410-20 Asset Retirement Obligations. ASC 410-20
requires the Company to recognize a liability for the present value of all legal obligations associated with the retirement of
tangible, long-lived assets as of the date when the legal obligation began 	and capitalize an equal amount as an asset retirement
cost (asset). Each period the liability is accreted using the effective interest rate method. The accretion is included as an
operating expense. The cost associated with the abandonment obligation, is included in the computation of depreciation, depletion
and amortization.



An adjustment has been recorded in the
consolidated financial statements to reflect accretion expense, and the related obligation and assets in accordance with ASC 410-20.



For Pipeline systems there is insufficient
information to reasonably determine the timing and/or method of settlement for estimating the fair value of the asset retirement
obligation. In these cases, the asset retirement obligation cost is considered indeterminate because there is no data or information
that can be derived from past practice, industry practice, our intentions or the estimated economic life of the asset. Useful
lives of most pipeline systems are primarily derived from available supply resources and ultimate consumption of those resources
by end users. Variables can affect the remaining lives of the assets which preclude us from making a reasonable estimate of the
asset retirement obligation. Indeterminate asset retirement obligation costs will be recognized in the period in which sufficient
information exists to allow us to reasonably estimate potential settlement dates and methods.



In addition to the aforementioned situation,
it is not possible at this time to reasonably estimate the amount of any obligation for asset retirement obligation related to
refineries. In addition, The Company believes there is not sufficient information available to estimate the fair value of the
asset retirement obligation because the settlement date or the range of potential settlement dates have not been specified by
others and information is not available to apply an expected present value technique.





F-80







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The following table presents the changes
in asset retirement obligations for 2013 and 2012 as is required by ASC 410-20.



|                                          |  | 2013 |           |   | 2012 |  
|----------------------------------------- |  | ---- | --------- | - | ---- | -
|Balance at beginning of year              |  | $    | 2,219,651 |   |      | $
|Liabilities incurred in the current year  |  |      | 25,097    |   |      |  
|Revisions in estimated cash flows         |  |      | 426,727   |   |      |  
|Liabilities settled in the current period |  |      | (94,950   | ) |      |  
|Accretion expense                         |  |      | 177,545   |   |      |  
|Balance at end of year                    |  | $    | 2,754,070 |   |      | $



|xvii. | EQUITY CONTRIBUTIONS
|----- | --------------------



|a. | Incorporated Institutional
    Equity
|-- | -------------------------------------



At the end of association contracts that
were signed prior to January 1, 2004, private companies are required to transfer, without cost, to Ecopetrol, all producing wells,
facilities and other real estate and assets acquired in executing the contracts. Under Colombian Government Entity GAAP, the Company
accounts for the receipt, using the relinquishing Company’s reported historical cost, by recording an increase to assets
and equity. The assets are then depreciated in accordance with the Company’s previously disclosed accounting policies. For
U.S. GAAP reporting purposes, these balances and their related impacts on accumulated depreciation, depletion and amortization,
and cost of production have been removed from the financial statements, based on the fact that the cost of these assets is zero.



The adjustment to conform to U.S. GAAP
in 2013 was a reduction in equity of $28,300 (original value of $149,923 net of $121,623 in accumulated depreciation for the assets
received).



The adjustment to conform to U.S. GAAP
in 2012 was a reduction in equity of $37,088 (original value of $149,695 net of $112,607 in accumulated depreciation for the assets
received).



The adjustment to conform to U.S. GAAP
in 2011 was a reduction in equity of $50,479 (original value of $148,999 net of $98,520 in accumulated depreciation for the assets
received).



|b. | Reversal of Concession
    Rights Contributed as Capital
|-- | --------------------------------------------------------



Under Colombian Government Entity GAAP
, the Company recorded as reservoirs the contributions of the Nation represented by crude oil and natural gas reserves deriving
from the reversion of concessions of oilfield areas in favor of the Nation, given before the effectiveness of Decree 1760 of 2003.
Reserves were valued by means of the technical-economic model where the value per barrel resulted from the relation of the net
present value obtained at a discount rate and the total proved reserves on the contribution date.



For U.S. GAAP purposes, these reversions
were considered a transfer of assets between entities under common control. Ecopetrol, the entity that received the net assets,
recognized the assets transferred at their carrying amounts in the accounts of the transferring entity at the date of transfer
which was zero value. The unamortized amount reverted at December 31, 2013 and 2012 was $14,733 and $17,013, respectively. Since
2003 (creation of the Agencia Nacional de Hidrocarburos - ANH) there have not been reversals of concessions.



|xviii. | PUBLIC OFFERING COST AND
    DISCOUNT ON ISSUANCE OF SHARES
|------ | -----------------------------------------------------------



In August 2011, the Company issued shares
in a second public offering in Colombia. Under Colombian Government Entity GAAP, all related costs of this issuance were expensed
as well as a discount granted to shares fully paid in cash. For U.S. GAAP purposes, direct costs incurred in public offerings
and cash discounts are recorded as a reduction of the proceeds received and, consequently, a reduction in equity. An adjustment
in the amount of $103,949 was recorded to recognize the effect of these amounts. There were not any public offering Shares
during 2013 and 2012.



|xix. | INDEBTEDNESS COST
|---- | -----------------



Under Colombian Government Entity GAAP,
the borrowing costs correspond to interest paid, lender commissions and other costs related to the debt transactions, the exchange
difference for the interest rate to be paid, the amortization of premiums and discounts in the placement of bonds and securities,
and any income results earned on the temporary investment of such loans.



Under U.S. GAAP, the borrowing costs correspond
to interest paid, lender commissions and other costs related to the debt transactions, the amortization of premiums and discounts
in the placement of bonds and securities, should not offset interest expense with interest income, unless the financing transaction
involves restricted, tax-exempt borrowings. Unlike Colombian Government Entity GAAP, the cost of borrowing does not include the
exchange difference for the interest rate to be paid, unless such difference forms part of the negotiation of the interest rate
for the transaction.



F-81







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The total indebtedness cost incurred during
2013 under Colombian Government Entity GAAP was $1,022,774 and the total indebtedness cost incurred under U.S. GAAP was $1,021,389.
The effects of this adjustment in the reconciliation of income were $1,385. The total indebtedness cost incurred during 2012 under
Colombian Government Entity GAAP was $820,821 and the total indebtedness cost incurred under U.S. GAAP was $820,856. The effects
of this adjustment in the reconciliation of income were $36. The total indebtedness cost incurred during 2011 under Colombian
Government Entity GAAP was $ 608,261 and the total indebtedness cost incurred under U.S. GAAP was $608,912. The effects of
this adjustment in the reconciliation of income were $652.



|xx. | BUSINESS COMBINATIONS
|--- | ---------------------



|a. | Goodwill
|-- | --------



Under Colombian Government Entity GAAP,
goodwill corresponds to the difference between the acquisition price and the book value of the acquired company and is recognized
as an intangible asset. Separate intangibles are not identified under Colombian Government Entity GAAP nor are assets stepped
up to fair values as a result of acquisitions; if the book value is higher than the acquisition price, the resulting difference
is recorded as a gain. The amount recognized as goodwill is amortized during the period in which the Company expects to receive
future benefits; in addition, it is subject to an annual impairment test.



Under U.S. GAAP ASC 350-20-35-3, we first
assess qualitative factors to determine whether to perform the goodwill impairment test. If determined necessary, we use the two
step impairment test in order to identify potential goodwill impairments and to measure the amount of impairment loss to be recognized.
In the first step, we compare the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying
amount of a reporting unit exceeds its fair value of the reporting unit, goodwill of the reporting unit is considered impaired;
thus, the second step of the impairment test is necessary.



The second step of the goodwill impairment
test, used to measure the amount of impairment loss, compares the implied fair value of reporting unit goodwill with the carrying
amount of that goodwill. If the carrying amount of reporting unit goodwill exceeds the implied fair value of that goodwill, an
impairment loss shall be recognized in an amount equal to that excess. The loss recognized cannot exceed the carrying amount of
goodwill.



After a goodwill impairment loss is recognized,
the adjusted carrying amount of goodwill shall be its new accounting basis.



The following table shows, by Company,
the goodwill balance as of December 31, 2013 and 2012, and the translation adjustment:



|Company                     |  | Balance
    beforeimpairment2012 |           |  | Goodwillacquired during2013 |   |   | Exchangerate effect |  |   | Deferredincome tax |  |  | Balance
    beforeimpairment2013 |        |   | Accumulatedimpairment 2013 |   |           | Balance
    2013 | 
|--------------------------- |  | -------------------------------- | --------- |  | --------------------------- | - | - | ------------------- |  | - | ------------------ |  |  | -------------------------------- | ------ | - | -------------------------- | - | --------- | ---------------- | 
|Propilco                    |  | $                                | 636,018   |  |                             | $ | - |                     |  | $ | 52,859             |  |  | $                                | (1,540 | ) |                            | $ | 687,337   |                  | 
|Refineria de Cartagena S.A. |  |                                  | 666,150   |  |                             |   | - |                     |  |   | 59,750             |  |  |                                  | -      |   |                            |   | 725,900   |                  | 
|Bioenergy                   |  |                                  | 8,993     |  |                             |   | - |                     |  |   | -                  |  |  |                                  | -      |   |                            |   | 8,993     |                  | 
|Total                       |  | $                                | 1,311,161 |  |                             | $ | - |                     |  | $ | 112,609            |  |  | $                                | (1,540 | ) |                            | $ | 1,422,230 |                  | 



|Company                     |  | Balance
     beforeimpairment2011 |           |  | Goodwillacquired during2012 |   |   | Exchangerate effect |  |   | Deferredincome tax |   |  | Balance
    beforeimpairment2012 |        |   | Accumulatedimpairment 2012 |   |           | Balance
    2012 | 
|--------------------------- |  | --------------------------------- | --------- |  | --------------------------- | - | - | ------------------- |  | - | ------------------ | - |  | -------------------------------- | ------ | - | -------------------------- | - | --------- | ---------------- | 
|Propilco                    |  | $                                 | 694,387   |  |                             | $ | - |                     |  | $ | (56,829            | ) |  | $                                | (1,540 | ) |                            | $ | 636,018   |                  | 
|Refineria de Cartagena S.A. |  |                                   | 731,879   |  |                             |   | - |                     |  |   | (65,729            | ) |  |                                  | -      |   |                            |   | 666,150   |                  | 
|Bioenergy                   |  |                                   | 8,993     |  |                             |   | - |                     |  |   | -                  |   |  |                                  | -      |   |                            |   | 8,993     |                  | 
|Total                       |  | $                                 | 1,435,259 |  |                             | $ | - |                     |  | $ | (122,558           | ) |  | $                                | (1,540 | ) |                            | $ | 1,311,161 |                  | 



F-82







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Under Colombian Government Entity GAAP,
the following table shows the amounts deductible for income tax purposes for 2013 and 2012.





|                                     |  | 2013     |          
|------------------------------------ |  | -------- | ---------
|Company                              |  | Goodwill |          
|Propilco                             |  | $        | 176,506  
|Andean Chemicals Ltd                 |  |          | 205,541  
|IPL Enterprises                      |  |          | 880,127  
|Offshore International Group – “OIG” |  |          | 536,079  
|Hocol                                |  |          | 742,345  
|Equion                               |  |          | 629,375  
|Total                                |  | $        | 3,169,973







|                                     |  | 2012     |          
|------------------------------------ |  | -------- | ---------
|Company                              |  | Goodwill |          
|Propilco                             |  | $        | 327,986  
|Andean Chemicals Ltd                 |  |          | 357,629  
|IPL Enterprises                      |  |          | 537,093  
|Offshore International Group – “OIG” |  |          | 748,986  
|Hocol                                |  |          | 748,947  
|Equion                               |  |          | 972,409  
|Total                                |  | $        | 3,693,050







Under Colombian Government Entity GAAP
in 2013 and 2012, $144,356 and $282,463 were amortized in regard to goodwill acquired from OIG, Hocol, Andean Chemicals, IPL Enterprises,
Propilco and Equion. The amortization in the table above represents the accumulated amortization of the companies that could
be deductible for income tax purposes. Under U.S. GAAP, goodwill acquired from OIG, which is recognized by the equity method,
is included as part of the investment.



Under U.S. GAAP, Ecopetrol tests goodwill
for impairment at least annually using a two-step process that begins with an estimation of the fair value of a reporting unit. The
first step is a screen for potential impairment and the second step measures the amount of impairment. Ecopetrol did not perform
a qualitative analysis although allowed.



For impairment purposes fair value is
determined by reference to market value, if available, or by a qualified evaluator or pricing model. Determination of a fair value
by a qualified evaluator or pricing model requires management to make assumptions and use estimates.  Management believes
that the assumptions and estimates used are reasonable and supportable in the existing market environment and commensurate with
the risk profile of the assets valued.  However, different assumptions and estimates could be used which would lead
to different results.  The valuation models used to determine the fair value of these companies are sensitive to changes
in the underlying assumptions.  For example, the prices and volumes of product sales to be achieved and the prices which
will be paid for the purchase of raw materials are assumptions which may vary in the future.  Adverse changes in any
of these assumptions could lead the Company to record a goodwill impairment charge.



During 2013 and 2011, Ecopetrol performed
an impairment test of goodwill which showed that the Propilco was impaired by $280,493 and $46,691, respectively. During 2013,
lower supply from Ecopetrol increased the variable costs, as the company switched their raw material suppliers.  Furthermore,
the company performance was challenged by shifts in the petrochemical markets, as a result  of new shale gas discoveries
in the U.S. and low costs products coming from Asia. During 2012, Ecopetrol Performed an impairment test of goodwill and there
was no impairment.



|b. | Business Combination
|-- | --------------------



During 2012 and 2013, Ecopetrol was not
in any business combinations.



In January 24, 2011, we obtained required
authorizations to completed the acquisition of BP Exploration Company (Colombia) Limited, a British Petroleum subsidiary operating
in Colombia, which includes assets in oil and gas exploration and production as well as oil transportation and gas marketing.
As a result of this acquisition, we increased our participation in the ownership of the Ocensa pipeline from 60.00% to 72.65%,
in ODC from 66% to 73% and in Oleoducto del Alto Magdalena, or OAM assets, from 83.00% to 85.12%. We also acquired a 10.20% interest
in Transgas de Occidente.



F-83







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The total acquisition price, paid in cash,
was US$1,596,157 thousands. Ecopetrol totals 51% ownership, the remaining 49% represents Talisman Energy Inc. share. The following
table details the purchase price calculation (USD in thousands) as well as the Colombian peso equivalent (in millions) of the
transaction using the effective exchange rate on the payments dates.



|                                |  | Amount USD |           |   | Amount COP |  
|------------------------------- |  | ---------- | --------- | - | ---------- | -
|Purchase Price                  |  | $          | 1,750,000 |   |            |  
|Less: Purchase Price Adjustment |  |            | (153,842  | ) |            |  
|Adjusted Purchase Price         |  |            | 1,596,157 |   |            |  
|Participation (%)               |  |            | 51        | % |            |  
|Total Purchase Price            |  | $          | 814,040   |   |            | $



The acquisition was accounted for as a
business combination (ASC 805) which, among other things, requires assets acquired and liabilities assumed to be measured at their
acquisition date fair values. Fair value measurements and Purchase Price Allocation process was finalized in fourth quarter 2011.



Pro-forma financial information is not
presented as it would not be materially different from the information presented in the Consolidated Statement of Income.



The following table summarizes the measurement
at fair value of the assets acquired and liabilities assumed:



|                                           |  | Amount USD |          
|------------------------------------------ |  | ---------- | ---------
|Current assets                             |  | $          | 293,465  
|Investments and long-term receivables      |  |            | 508,242  
|Property, plant and equipment and reserves |  |            | 1,367,948
|Deferred tax asset                         |  |            | 15,073   
|Other assets                               |  |            | 24,913   
|Total assets acquired                      |  | $          | 2,209,641
|Current liabilities                        |  |            | 331,145  
|Long term debt                             |  |            | 3,601    
|Deferred tax liability                     |  |            | 283,332  
|Other liabilities                          |  |            | 131,835  
|Total liabilities acquired                 |  |            | 749,913  
|Net assets acquired                        |  | $          | 1,459,728
|Non-controlling interest goodwill          |  |            | 66,850   
|Goodwill                                   |  |            | 69,579   
|Total consideration paid in cash           |  | $          | 1,596,157



Property, plant and equipment and reserves
were measured primarily using an income approach. The fair values of the acquired oil and gas properties were based on significant
inputs not observable in the market and thus represent Level 3 measurements. Significant inputs included estimated resource volumes,
assumed future production profiles, and assumptions on the timing and amount of future operating and development costs.



The net assets acquired for US$1,459,728,
represent $2,682,999 pesos and goodwill of $226,592 pesos. The goodwill represents the amount of the consideration transferred
in excess of the values assigned to the individual assets acquired and liabilities assumed. Goodwill represents the future economic
benefits arising from other assets acquired that could not be individually identified and separately recognized. The fair value
of the 49% share of Talisman Energy Inc. is US$782,117.



In Colombia, the goodwill is deductible
for tax purposes, thus, a deferred tax asset of $315,979 was recognized for the difference between the tax goodwill and the goodwill,
resulting in a bargain purchase gain of $89,387 recorded in earnings for the year ended December 31, 2011.



In addition, Ecopetrol increased its ownership
interest in Ocensa and ODC while retaining control, as a result, the difference between the fair value and the carrying amount
of the non-controlling interest was recognized in a decrease in additional paid-in-capital for the amount of $792,440.

F-84







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011





|xxi. | NON-CONTROLLING INTEREST
|---- | ------------------------



This table presents the carrying amount
of total equity (net assets) attributable to the non-controlling interest under U.S. GAAP as of December 31st of 2013,
2012 and 2011.



|                                  |  | OCENSA |          |   | ODC |   |        | ODL |  |   | BIOENERGY |   |  | OBC |        |   | EQUION |   |         | TOTAL | 
|--------------------------------- |  | ------ | -------- | - | --- | - | ------ | --- |  | - | --------- | - |  | --- | ------ | - | ------ | - | ------- | ----- | 
|Balance 2010                      |  |        | 143,490  |   |     |   | 10,921 |     |  |   | 150,458   |   |  |     | 9,524  |   |        |   | (5,042  | )     | 
|Acquired non-controlling interest |  |        | (88,970  | ) |     |   | (3,536 | )   |  |   | -         |   |  |     | -      |   |        |   | -       |       | 
|Issuance of Company shares        |  |        | -        |   |     |   | -      |     |  |   | 53,284    |   |  |     | -      |   |        |   | 321,044 |       | 
|Net income (loss)                 |  |        | 37,787   |   |     |   | (4,739 | )   |  |   | 22,493    |   |  |     | (2,294 | ) |        |   | (9,114  | )     | 
|Other comprehensive income        |  |        | -        |   |     |   | -      |     |  |   | -         |   |  |     | -      |   |        |   | -       |       | 
|Translation adjustments           |  |        | -        |   |     |   | -      |     |  |   | 1,404     |   |  |     | -      |   |        |   | -       |       | 
|Balance 2011                      |  | $      | 92,307   |   |     | $ | 2,646  |     |  | $ | 227,639   |   |  | $   | 7,230  |   |        | $ | 306,888 |       | 
|Acquired non-controlling interest |  |        | -        |   |     |   | -      |     |  |   | -         |   |  |     | (1,797 | ) |        |   | 672     |       | 
|Issuance of Company shares        |  |        | -        |   |     |   | -      |     |  |   | -         |   |  |     | 5,492  |   |        |   | -       |       | 
|Net income (loss)                 |  |        | 51,408   |   |     |   | 11,888 |     |  |   | 46,133    |   |  |     | (1,593 | ) |        |   | (13,700 | )     | 
|Other comprehensive income        |  |        | -        |   |     |   | -      |     |  |   | -         |   |  |     | -      |   |        |   | -       |       | 
|Translation adjustments           |  |        | -        |   |     |   | -      |     |  |   | (44       | ) |  |     | -      |   |        |   | -       |       | 
|Spin-off of Ocensa shares         |  |        | 73,797   |   |     |   | -      |     |  |   | -         |   |  |     | -      |   |        |   | -       |       | 
|Dividends for Spin-Off            |  |        | -        |   |     |   | -      |     |  |   | -         |   |  |     | -      |   |        |   | -       |       | 
|Balance 2012                      |  | $      | 217,512  |   |     | $ | 14,534 |     |  | $ | 273,728   |   |  | $   | 9,332  |   |        | $ | 293,860 |       | 
|Payment of dividends              |  |        | (255,719 | ) |     |   | -      |     |  |   | -         |   |  |     | -      |   |        |   | -       |       | 
|Capital contribution              |  |        | -        |   |     |   | -      |     |  |   | -         |   |  |     | 9,164  |   |        |   | -       |       | 
|Net income (loss)                 |  |        | 344,247  |   |     |   | 18,566 |     |  |   | 56,583    |   |  |     | (2,335 | ) |        |   | (37,992 | )     | 
|Other comprehensive income        |  |        | -        |   |     |   | -      |     |  |   | -         |   |  |     | -      |   |        |   | -       |       | 
|Translation adjustments           |  |        | -        |   |     |   | -      |     |  |   | 85        |   |  |     | -      |   |        |   | -       |       | 
|Balance 2013                      |  | $      | 306,040  |   |     | $ | 33,100 |     |  | $ | 330,396   |   |  | $   | 16,161 |   |        | $ | 255,868 |       | 



|xxii. | CUMULATIVE TRANSLATION
    ADJUSTMENT
|----- | -------------------------------------



Under Colombian Government Entity GAAP,
the companies domiciled outside Colombia, regardless of their functional currency, must report in USD and translate balances to
Colombian pesos with the impact recorded as a cumulative translation adjustment.



For U.S. GAAP, the Company must remeasure
all subsidiary financial information to its functional currency and then translate it to the reporting currency. This difference
in methodology results in a difference in the translated amounts recorded in the consolidated financial statements.



|xxiii. | EARNINGS PER SHARE
|------ | ------------------



Under Colombian Government Entity GAAP,
earnings per share ("EPS") are calculated by dividing net income by the weighted average of both common and preferred
shares outstanding for each period presented. However, although the Company has presented EPS under Colombian Government
Entity GAAP for informational purposes, the presentation of EPS is not required for financial statements issued under Colombian
Government Entity GAAP. The Company does not have any issued or outstanding preferred shares.



U.S. GAAP requires dual presentation of
basic and diluted EPS for entities with complex capital structures, as well as a reconciliation of the basic EPS calculation with
the diluted EPS calculation. Basic EPS is calculated by dividing net income available to common shareholders by the weighted
average of common shares outstanding for the corresponding period.



Diluted EPS assumes the issuance of common
shares for all dilutive potential common shares outstanding during the reporting period. For the years ended December 31,
2013, 2012 and 2011, the Company had a simple capital structure. There are not any other compensation plan involving shares. Therefore,
the Company is not required to present diluted EPS for these years.



|xxiv. | RECENTLY ADOPTED U.S. ACCOUNTING
    STANDARDS
|----- | ----------------------------------------------



In December, 2011, FASB issued ASU No.
2011-11 Balance Sheet (Topic 210) - Disclosures about Offsetting Assets and Liabilities, the amendments require an entity to disclose
information about offsetting and related arrangements on derivatives, hedging, repurchase agreements, reverse repurchase agreements,
and securities transactions, to enable users of the financial statements to understand the effect of those arrangements in the
financial position. An entity is required to apply the amendments for annual reporting periods beginning on or after January 1,
2013, and interim periods within those annual periods. The adoption of this ASU has not any effect because we do not have any
such compensation agreements.



In February, 2013, FASB issued ASU No. 2013-02
Other Comprehensive Income (ASC 220). The provisions of this ASU require an entity to disclose any reclassifications out of other
comprehensive income if the amount is required under U.S. GAAP to be reclassified in their entirety in the same reporting period.
For other amounts that are not required to be reclassified in their entirety to net income in the same reporting period an entity
is required to cross-reference other disclosures that provide additional detail about those amounts. These amendments are effective
prospectively for reporting periods beginning after December 15, 2012. Ecopetrol adopted this ASU from this reporting period as
shown in item 18, section C, note 3 Supplemental consolidated comprehensive income. No material effects arose from the adoption.



F-85







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011





| | Recently issued Accounting
    Standards and U.S. GAAP Pronouncements
| | ---------------------------------------------------------------------



In February, 2013, FASB issued ASU No.
2013-04 Liabilities (ASC 405) - Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount
of the Obligation Is Fixed at the Reporting Date. The amendments in this Update require an entity to measure obligations resulting
from joint and several liability arrangements for which the total amount is fixed at the reporting date, as the sum of: a) The
amount the entity agreed to pay on the basis of its arrangement among its- co-obligors; b) Any additional amount the entity expects
to pay on behalf of its co-obligors. An entity is also required to disclose the nature and amount of the obligation as well as
other information about those obligations. These amendments are effective retrospectively for fiscal years beginning after December
15, 2013; early adoption is permitted. As of the reporting date Ecopetrol has no operations within the scope of this ASU.



In March, 2013, FASB issued ASU No. 2013-05
Foreign Currency Matters (Topic 830) Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of
Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity. This update sets new
rules on how and when an entity is required to release the cumulative translation adjustment into net income when an entity ceases
to have a controlling interest in a subsidiary or a group of assets within a foreign entity. The amendments in this update are
effective prospectively for fiscal years beginning after December 15, 2013. Early adoption is permitted, however Ecopetrol does
not intend to use this option. As of the reporting date we do not expect any significant effects arising from the adoption of
this ASU.



In July, 2013, FASB issued ASU No. 2013-11
Income Taxes (Topic 740) - Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss,
or a Tax Credit Carryforward Exists. These amendments require an entity to present an unrecognized tax benefit as a liability
instead of being combined with an asset, to the extent that a net operating loss carryforward or similar tax loss or a tax credit
carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional
income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not
require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose.



|xxv. | CONCENTRATIONS
|---- | --------------



In 2013 one customer of the refining segment
accounted for 11.4% of total sales. No other customers accounted for more than 10% of total sales in 2013. In 2012 there were
no customers in excess of 10% of total sales. In 2011 there were no customers in excess of 10% of total sales. There was no exposure
that affects the financial position of Ecopetrol if the company lost the client.



The majority of the Company’s assets
and activities are located in Colombia. The financial position and results of operations of those subsidiaries located outside
of Colombia are not material to the Company.



|xxvi. | SEGMENT INFORMATION
|----- | -------------------



From the first quarter of 2013 a change
was implemented in the reported segments, which consisted of removing the segment of Supply and Marketing. This change is because
the marketing margin, which was the reason for that segment, has suffered different impacts (changes in the marketing scheme ANH
royalties and therefore in agreement with that entity; preference of the Refinery by loading ANH crude and third parties, leaving
this segment the crude oil marketing that has lower earning, among others) that make such a small margin today; and therefore
cannot be considered in itself a core business of the company. This activity could migrate to a simple model of marketing services
to Exploration and Production and Refining segments.



By
eliminating the Supply and Marketing segment,which was approved by the Board Director,
revenues and costs associated with the marketing of refined products, buying
crude oil and gas, were allocated in proportion to their use to the Refining & Petrochemicals and Exploration & Production
segments. The amounts for 2012 and 2011 were restated for comparative purposes.



The following segment information has
been prepared according to ASC 280, Disclosure about Segments of an Enterprise and Related Information. Financial information
by business segment is reported in accordance with the internal reporting system under RCP and shows internal segment information
that is used by the chief operating decision maker to manage and measure the performance of Ecopetrol.



The financial information among segments
is reported considering each business as a separate entity. Prices between segments are established by referencing those that
would apply in an arm’s length transaction. Each segment should bear the costs and expenses required to put the product
in terms of use or marketing. Each segment assumes its administrative expenses and all non-operational transactions related to
their activity.



The Company operates under the following
segments, which are described as follows:



Exploration and Production -
this segment includes the Company’s oil & gas exploration and production activities. Revenue is derived from the sale
of crude oil and natural gas to inter-company segments, at market prices, and to third parties. Revenue is derived from local
sales of crude oil, regulated fuels, non-regulated fuels and natural gas. Sales are made to local and foreign distributors. Costs
include those costs incurred in production. Expenses include all exploration costs that are not capitalized.



F-86







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Refining and Petrochemicals -this segment includes the Company’s refining activities. Goods sold, both internally and to third parties, include refined
products such as motor fuels, fuel oils and petrochemicals at market prices. This segment also includes sales of industrial services
to third parties.



Transportation and Logistics -
this segment includes the Company’s sales and costs associated with the Company’s pipelines and other transportation
activities



These functions have been defined as the
operating segments of the Company since these are the segments (a) that engage in business activities from which revenues are
earned and expenses are incurred; (b) whose operating results are regularly reviewed by the Company's chief operating decision
maker to allocate resources to the segments and assess their performance; and (c) for which discrete financial information is
available. Internal transfers represent sales to intercompany segments and are recorded and presented at market prices.



The following tables present the Company’s
consolidated balance sheet by segment in accordance with Colombian Government Entity GAAP:



|                                          |  | As of December 31, 2013 |            
|----------------------------------------- |  | ----------------------- | -----------
|                                          |  | Exploration &Production |            
|Current assets                            |  |                         |            
|Cash and cash equivalents                 |  | $                       | 4,341,135  
|Accounts and notes receivable             |  |                         | 4,514,267  
|Inventories                               |  |                         | 1,724,497  
|Investments                               |  |                         | 2,322,538  
|Other current assets                      |  |                         | 7,729,218  
|                                          |  |                         | 20,631,655 
|Investments in non-consolidated companies |  |                         | 692,954    
|Property, plant and equipment, net        |  |                         | 14,238,201 
|Natural and environmental resources, net  |  |                         | 21,456,659 
|Other long term assets                    |  |                         | 11,306,958 
|Long term assets                          |  |                         | 47,694,772 
|Total assets                              |  | $                       | 68,326,427 
|                                          |  |                         |            
|Accounts payable                          |  | $                       | (5,572,807 
|Financial obligations short-term          |  |                         | (236,376   
|Other current liabilities                 |  |                         | (7,239,844 
|Current liabilities                       |  |                         | (13,049,027
|Financial obligations long-term           |  |                         | (6,814,352 
|Other long term liabilities               |  |                         | (9,936,820 
|Long term liabilities                     |  |                         | (16,751,172
|Total liabilities                         |  |                         | (29,800,199
|Non-controlling interest                  |  |                         | (1,376,969 
|Shareholders’ equity of Ecopetrol         |  |                         | (37,149,259
|Total equity                              |  |                         | (38,526,228
|Total liabilities and equity              |  | $                       | (68,326,427
|Capital expenditures                      |  | $                       | 9,622,932  
|Goodwill                                  |  | $                       | 1,254,738  



F-87







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



|                                          |  | As of December 31, 2012  |            
|----------------------------------------- |  | ------------------------ | -----------
|                                          |  | Exploration & Production |            
|Current assets                            |  |                          |            
|Cash and cash equivalents                 |  | $                        | 6,210,697  
|Accounts and notes receivable             |  |                          | 3,546,348  
|Inventories                               |  |                          | 1,548,335  
|Investments                               |  |                          | 2,113,529  
|Other current assets                      |  |                          | 3,349,701  
|                                          |  |                          | 16,768,610 
|Investments in non-consolidated companies |  |                          | 1,024,057  
|Property, plant and equipment, net        |  |                          | 12,001,716 
|Natural and environmental resources, net  |  |                          | 18,650,368 
|Other long term assets                    |  |                          | 19,065,853 
|Long term assets                          |  |                          | 50,741,994 
|Total assets                              |  | $                        | 67,510,604 
|                                          |  |                          |            
|Accounts payable                          |  | $                        | (8,288,357 
|Financial obligations short-term          |  |                          | (405,327   
|Other current liabilities                 |  |                          | (6,522,910 
|Current liabilities                       |  |                          | (15,216,594
|Financial obligations long-term           |  |                          | (2,964,805 
|Other long term liabilities               |  |                          | (9,604,718 
|Long term liabilities                     |  |                          | (12,569,523
|Total liabilities                         |  |                          | (27,786,117
|Non-controlling interest                  |  |                          | (1,020,677 
|Shareholders’ equity of Ecopetrol         |  |                          | (38,703,810
|Total equity                              |  | $                        | (39,724,487
|Total liabilities and equity              |  | $                        | (67,510,604
|Capital expenditures                      |  | $                        | 8,225,642  
|Goodwill                                  |  | $                        | 1,945,463  



The Company’s consolidated statement
of net income by segment is as follows in accordance with Colombian Government Entity GAAP:



|                                               |  | Year ended December 31, 2013 |           
|---------------------------------------------- |  | ---------------------------- | ----------
|                                               |  | Exploration &Production      |           
|                                               |  |                              |           
|Revenues:                                      |  |                              |           
|Local sales                                    |  | $                            | 3,194,136 
|Foreign sales, net                             |  |                              | 41,153,504
|Services                                       |  |                              | 29,575    
|Inter-segment net operating revenues           |  |                              | 5,601,988 
|Total Revenue                                  |  |                              | 49,979,203
|Cost of sales                                  |  |                              | 20,962,509
|Depreciation, depletion and amortization       |  |                              | 3,911,239 
|Selling and projects                           |  |                              | 2,963,917 
|Administration expenses                        |  |                              | 640,800   
|Costs and expenses                             |  |                              | 28,478,465
|Operating income                               |  |                              | 21,500,738
|Financial income (expenses), net               |  |                              | 58,161    
|Pension expenses                               |  |                              | (192,587  
|Other non-operating income (expenses)          |  |                              | 250,126   
|Other expenses, net                            |  |                              | 115,700   
|Income before income taxes and non-controlling |  |                              | 21,616,438
|Income tax benefit (expense)                   |  |                              | (7,697,287
|Non-Controlling interest                       |  |                              | (255,051  
|Net income for the year                        |  | $                            | 13,664,100



F-88







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



|                                               |  | Year ended December 31, 2012 |           
|---------------------------------------------- |  | ---------------------------- | ----------
|                                               |  | Exploration &Production      |           
|                                               |  |                              |           
|Revenues:                                      |  |                              |           
|Local sales                                    |  | $                            | 2,517,035 
|Services                                       |  |                              | 184,441   
|Foreign sales, net                             |  |                              | 41,758,403
|Inter-segment net operating revenues           |  |                              | 8,191,244 
|Total Revenue                                  |  |                              | 52,651,123
|Cost of sales                                  |  |                              | 21,910,603
|Depreciation, depletion and amortization       |  |                              | 3,669,404 
|Selling and projects                           |  |                              | 2,769,044 
|Administration expenses                        |  |                              | 471,779   
|Costs and expenses                             |  |                              | 28,820,830
|Operating income                               |  |                              | 23,830,293
|Financial income (expenses), net               |  |                              | (153,936  
|Pension expenses                               |  |                              | (379,565  
|Other non-operating income (expenses)          |  |                              | 140,002   
|Other expenses, net                            |  |                              | (393,499  
|Income before income taxes and non-controlling |  |                              | 23,436,794
|Income tax benefit (expense)                   |  |                              | (7,432,174
|Non-Controlling interest                       |  |                              | (352,649  
|Net income for the year                        |  | $                            | 15,651,971



|                                               |  | Year ended December 31, 2011 |           
|---------------------------------------------- |  | ---------------------------- | ----------
|                                               |  | Exploration &Production      |           
|                                               |  |                              |           
|Revenues:                                      |  |                              |           
|Local sales                                    |  | $                            | 2,104,106 
|Foreign sales, net                             |  |                              | 39,407,562
|Inter-segment net operating revenues           |  |                              | 5,787,233 
|Total Revenue                                  |  |                              | 47,298,901
|Cost of sales                                  |  |                              | 17,077,573
|Depreciation, depletion and amortization       |  |                              | 3,253,845 
|Selling and projects                           |  |                              | 1,978,344 
|Administration expenses                        |  |                              | 586,780   
|Costs and expenses                             |  |                              | 22,896,542
|Operating income                               |  |                              | 24,402,359
|Financial income (expenses), net               |  |                              | (510,870  
|Pension expenses                               |  |                              | (292,648  
|Other non-operating income (expenses)          |  |                              | 135,188   
|Other expenses, net                            |  |                              | (668,330  
|Income before income taxes and non-controlling |  |                              | 23,734,029
|Income tax benefit (expense)                   |  |                              | (7,993,182
|Non-Controlling interest                       |  |                              | (208,962  
|Net income for the year                        |  | $                            | 15,531,885



The following tables illustrate sales
by geographic zones:



Sales by geographic zones December 31,
2013



|Zone                          |  | Products                                           |  | Value |            |  | Participation | 
|----------------------------- |  | -------------------------------------------------- |  | ----- | ---------- |  | ------------- | 
|Colombia*                     |  | Crude oil, Refined, Petrochemicals and natural gas |  | $     | 26,352,461 |  |               | 
|United States of America      |  | Crude oil, Refined and Petrochemicals              |  |       | 20,609,349 |  |               | 
|Asia                          |  | Crude oil, Refined and Petrochemicals              |  |       | 11,326,247 |  |               | 
|Europe                        |  | Crude oil, Refined, and Petrochemicals             |  |       | 4,895,570  |  |               | 
|South America                 |  | Crude oil, Refined Petrochemicals and natural gas  |  |       | 1,666,422  |  |               | 
|Central America and Caribbean |  | Crude oil, Refined and Petrochemicals              |  |       | 3,640,865  |  |               | 
|Other                         |  | Petrochemicals                                     |  |       | 1,937,800  |  |               | 
|                              |  |                                                    |  | $     | 70,428,714 |  |               | 



*Includes sales to free trade zone by
$144,562



F-89







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Sales by geographic zones December 31,
2012



|Zone                          |  | Products                                           |  | Value |            |  | Participation | 
|----------------------------- |  | -------------------------------------------------- |  | ----- | ---------- |  | ------------- | 
|Colombia*                     |  | Crude oil, Refined, Petrochemicals and natural gas |  | $     | 24,447,603 |  |               | 
|United States of America      |  | Crude oil, Refined and Petrochemicals              |  |       | 24,721,340 |  |               | 
|Asia                          |  | Crude oil, Refined and Petrochemicals              |  |       | 7,201,295  |  |               | 
|Africa                        |  | Refined and Petrochemicals                         |  |       | 330,775    |  |               | 
|Europe                        |  | Crude oil, Refined, and Petrochemicals             |  |       | 3,977,682  |  |               | 
|South America                 |  | Crude oil, Refined Petrochemicals and natural gas  |  |       | 1,791,111  |  |               | 
|Central America and Caribbean |  | Crude oil, Refined and Petrochemicals              |  |       | 6,213,770  |  |               | 
|Other                         |  | Petrochemicals                                     |  |       | 168,426    |  |               | 
|                              |  |                                                    |  | $     | 68,852,002 |  |               | 



*Includes sales to free trade zone by
$85,690



Sales by geographic zones December 31,
2011



|Zone                          |  | Products                                           |  | Value |            |  | Participation | 
|----------------------------- |  | -------------------------------------------------- |  | ----- | ---------- |  | ------------- | 
|Colombia*                     |  | Crude oil, Refined, Petrochemicals and natural gas |  | $     | 23,659,990 |  |               | 
|United States of America      |  | Crude oil, Refined and Petrochemicals              |  |       | 27,450,466 |  |               | 
|Asia                          |  | Crude oil, Refined and Petrochemicals              |  |       | 4,351,492  |  |               | 
|Africa                        |  | Refined and Petrochemicals                         |  |       | 140,512    |  |               | 
|South America                 |  | Crude oil, Refined, Petrochemicals and natural gas |  |       | 2,458,953  |  |               | 
|Central America and Caribbean |  | Crude oil, Refined and Petrochemicals              |  |       | 5,054,208  |  |               | 
|Europe                        |  | Crude oil, Refined and Petrochemicals              |  |       | 2,768,359  |  |               | 
|Other                         |  | Petrochemicals                                     |  |       | 83,534     |  |               | 
|                              |  |                                                    |  | $     | 65,967,514 |  |               | 

*Includes sales to free trade zone of
$105,361



The following tables illustrate sales
of products by segment:



Sales of products by segment December
31, 2013



|Local Sales                   |  | Exploration & Production |           |  | Refining Activities |   |            | Transportation |  |   | Eliminations |  |  | Total |           
|----------------------------- |  | ------------------------ | --------- |  | ------------------- | - | ---------- | -------------- |  | - | ------------ |  |  | ----- | ----------
|Medium distillates            |  | $                        | 4,429     |  |                     | $ | 11,578,473 |                |  | $ | -            |  |  | $     | -         
|Gasolines                     |  |                          | 613       |  |                     |   | 5,967,471  |                |  |   | -            |  |  |       | -         
|Crude oil                     |  |                          | 1,459,410 |  |                     |   | -          |                |  |   | -            |  |  |       | (37,790   
|Other products                |  |                          | 56,304    |  |                     |   | 1,154,899  |                |  |   | 163,180      |  |  |       | (132,109  
|Services                      |  |                          | 29,577    |  |                     |   | 202,323    |                |  |   | 5,639,436    |  |  |       | (3,409,460
|Natural gas                   |  |                          | 1,537,336 |  |                     |   | -          |                |  |   | -            |  |  |       | (9,645    
|L.P.G.                        |  |                          | 136,042   |  |                     |   | 239,316    |                |  |   | -            |  |  |       | -         
|Diesel and gasoline subsidies |  |                          | -         |  |                     |   | 938,679    |                |  |   | -            |  |  |       | -         
|Plastic and rubber            |  |                          | -         |  |                     |   | 615,424    |                |  |   | -            |  |  |       | -         
|Total local sales             |  | $                        | 3,223,711 |  |                     | $ | 20,696,585 |                |  | $ | 5,802,616    |  |  | $     | (3,589,004



|Foreign Sales               |  | Exploration & Production |            |  | Refining Activities |   |           | Transportation |  |   | Eliminations |  |  | Total |           
|--------------------------- |  | ------------------------ | ---------- |  | ------------------- | - | --------- | -------------- |  | - | ------------ |  |  | ----- | ----------
|Crude oil                   |  | $                        | 40,505,921 |  |                     | $ | -         |                |  | $ | -            |  |  | $     | (4,685,739
|Fuel oil                    |  |                          | -          |  |                     |   | 4,463,237 |                |  |   | -            |  |  |       | -         
|Gasolines                   |  |                          | -          |  |                     |   | 789,071   |                |  |   | -            |  |  |       | -         
|Diesel                      |  |                          | -          |  |                     |   | 1,195,704 |                |  |   | -            |  |  |       | -         
|L.P.G                       |  |                          | 2,360      |  |                     |   | 91,785    |                |  |   | -            |  |  |       | -         
|Natural gas                 |  |                          | 620,077    |  |                     |   | -         |                |  |   | -            |  |  |       | (33,390   
|Plastic and rubber          |  |                          | -          |  |                     |   | 857,397   |                |  |   | -            |  |  |       | -         
|Other products and services |  |                          | 25,146     |  |                     |   | 364,875   |                |  |   | -            |  |  |       | 98,362    
|Total foreign sales         |  | $                        | 41,153,504 |  |                     | $ | 7,762,069 |                |  | $ | -            |  |  | $     | (4,620,767



F-90







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Sales of products by segment December
31, 2012



|Local Sales                   |  | Exploration & Production |           |  | Refining Activities |   |            | Transportation |  |   | Eliminations |  |  | Total |           
|----------------------------- |  | ------------------------ | --------- |  | ------------------- | - | ---------- | -------------- |  | - | ------------ |  |  | ----- | ----------
|Medium distillates            |  | $                        | 1,839     |  |                     | $ | 11,131,140 |                |  | $ | -            |  |  | $     | -         
|Gasolines                     |  |                          | -         |  |                     |   | 5,697,178  |                |  |   | -            |  |  |       | -         
|Crude oil                     |  |                          | 842,975   |  |                     |   | -          |                |  |   | -            |  |  |       | (19,784   
|Other products                |  |                          | 116,265   |  |                     |   | 1,175,236  |                |  |   | 1,989        |  |  |       | (62,725   
|Services                      |  |                          | 186,449   |  |                     |   | 52,584     |                |  |   | 2,890,501    |  |  |       | (1,049,666
|Natural gas                   |  |                          | 1,392,889 |  |                     |   | -          |                |  |   | -            |  |  |       | (10,493   
|L.P.G.                        |  |                          | 160,968   |  |                     |   | 350,881    |                |  |   | -            |  |  |       | (19,409   
|Diesel and gasoline subsidies |  |                          | -         |  |                     |   | 809,773    |                |  |   | -            |  |  |       | -         
|Plastic and rubber            |  |                          | 91        |  |                     |   | 713,232    |                |  |   | -            |  |  |       | -         
|Total local sales             |  | $                        | 2,701,476 |  |                     | $ | 19,930,024 |                |  | $ | 2,892,490    |  |  | $     | (1,162,077



|Foreign Sales               |  | Exploration  &
    Production |            |  | Refining Activities |   |           | Transportation |  |   | Eliminations |  |  | Total |           
|--------------------------- |  | ----------------------------- | ---------- |  | ------------------- | - | --------- | -------------- |  | - | ------------ |  |  | ----- | ----------
|Crude oil                   |  | $                             | 41,129,261 |  |                     | $ | -         |                |  | $ | -            |  |  | $     | (5,242,401
|Fuel oil                    |  |                               | -          |  |                     |   | 4,283,814 |                |  |   | -            |  |  |       | -         
|Gasolines                   |  |                               | -          |  |                     |   | 1,182,367 |                |  |   | -            |  |  |       | -         
|Diesel                      |  |                               | -          |  |                     |   | 1,216,213 |                |  |   | -            |  |  |       | -         
|L.P.G                       |  |                               | 2,967      |  |                     |   | 48,540    |                |  |   | -            |  |  |       | -         
|Natural gas                 |  |                               | 606,011    |  |                     |   | -         |                |  |   | -            |  |  |       | (42,599   
|Plastic and rubber          |  |                               | -          |  |                     |   | 754,648   |                |  |   | -            |  |  |       | -         
|Other products and services |  |                               | 20,164     |  |                     |   | 531,103   |                |  |   | 477          |  |  |       | (476      
|Total foreign sales         |  | $                             | 41,758,403 |  |                     | $ | 8,016,685 |                |  | $ | 477          |  |  | $     | (5,285,476



Sales of products by Segment December
31, 2011



|Local Sales                   |  | Exploration & Production |           |  | Refining Activities |   |            | Transportation |  |   | Eliminations |  |  | Total |         
|----------------------------- |  | ------------------------ | --------- |  | ------------------- | - | ---------- | -------------- |  | - | ------------ |  |  | ----- | --------
|Medium distillates            |  | $                        | 6,141     |  |                     | $ | 9,736,205  |                |  | $ | -            |  |  | $     | -       
|Gasolines                     |  |                          | -         |  |                     |   | 5,206,873  |                |  |   | -            |  |  |       | -       
|Crude oil                     |  |                          | 460,591   |  |                     |   | -          |                |  |   | -            |  |  |       | (14,886 
|Other products                |  |                          | 63,979    |  |                     |   | 1,095,501  |                |  |   | -            |  |  |       |         
|Services                      |  |                          | 89,805    |  |                     |   | 27,468     |                |  |   | 2,543,697    |  |  |       | (874,326
|Natural gas                   |  |                          | 1,427,520 |  |                     |   | -          |                |  |   | -            |  |  |       | (8,413  
|L.P.G.                        |  |                          | 56,070    |  |                     |   | 671,041    |                |  |   | -            |  |  |       | -       
|Diesel and gasoline subsidies |  |                          | -         |  |                     |   | 2,251,322  |                |  |   | -            |  |  |       | -       
|Plastic and rubber            |  |                          | -         |  |                     |   | 816,041    |                |  |   | -            |  |  |       | -       
|Total local sales             |  | $                        | 2,104,106 |  |                     | $ | 19,804,451 |                |  | $ | 2,543,697    |  |  | $     | (897,625



|Foreign Sales       |  | Exploration &
    Production |            |  | Refining Activities |   |           | Transportation |  |   | Eliminations |  |  | Total |           
|------------------- |  | ---------------------------- | ---------- |  | ------------------- | - | --------- | -------------- |  | - | ------------ |  |  | ----- | ----------
|Crude oil           |  | $                            | 38,830,368 |  |                     | $ | -         |                |  | $ | -            |  |  | $     | (5,412,176
|Fuel oil            |  |                              | -          |  |                     |   | 4,447,657 |                |  |   | -            |  |  |       | -         
|Gasolines           |  |                              | -          |  |                     |   | 1,663,221 |                |  |   | -            |  |  |       | -         
|Diesel              |  |                              | -          |  |                     |   | 1,482,625 |                |  |   | -            |  |  |       | -         
|Natural gas         |  |                              | 554,540    |  |                     |   | -         |                |  |   | -            |  |  |       | (46,474   
|Plastic and rubber  |  |                              | -          |  |                     |   | 804,835   |                |  |   | -            |  |  |       | -         
|Other products      |  |                              | 22,654     |  |                     |   | 184,207   |                |  |   | 821          |  |  |       | (119,393  
|Total foreign sales |  | $                            | 39,407,562 |  |                     | $ | 8,582,545 |                |  | $ | 821          |  |  | $     | (5,578,043



NOTE: Certain amounts of the consolidated
financial statements of December 2012 and December 2011 were reclassified for presentation purposes consistent with those of December
31, 2013.



|xxvii. | RELATED PARTIES
|------ | ---------------



The Company is majority owned by Colombian
Government, so other state-owned companies and governmental entities are considered to be related parties. In addition to those
transactions disclosed in Note 16 of statutory financial statements and those included in Item 7, numerous transactions with these
entities exist. The most significant of them are disclosed below.



F-91







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Fuel subsidy: Selling prices of regular
motor gasoline and diesel are regulated by government. However a subsidy is granted to producers to compensate the difference
between selling price and U.S. Gulf reference market price. The amount received by the Company in 2013, 2012 and 2011 was $938,679,
$809,773 and $2,251,322, respectively.



Purchases of hydrocarbons from ANH: The
Company purchases the physical product that the ANH receives from all producers in Colombia at prices set forth by Law 756 of
2002 and Resolution 18-1709 of 2003, which references international prices. For more information on this transaction, please see
Notes 16 and 25.



The Company also paid in kind royalties
over certain fields as set forth in Law 141 of 1994, the Administrative Agreement of Collaborative Collection of Liquid Hydrocarbon
Royalties signed on September 16, 2010, with the ANH, and Decree 4923 of 2011. The quantities of oil and gas paid as in-kind royalties
to the ANH for the years ended December 31, 2013, 2012, 2011 were 51,973,436 boe, 54,095,846 boe and 59,059,539 boe, respectively.



The following tables present consolidated
accounts receivable, accounts payable as well as revenues and expenses with related parties of the Company as of December 31,
2013 and 2012:





|                                                                |  | 2013   |           |  | 2012        |  
|--------------------------------------------------------------- |  | ------ | --------- |  | ----------- | -
|                                                                |  | Assets |           |  | Liabilities |  
|Banco Agrario de Colombia                                       |  | $      | 5,482     |  |             | $
|Direccion de Impuestos y Aduanas Nacionales                     |  |        | 4,893,051 |  |             |  
|E.S.E. Hospital Universitario San Jorge-Pereira                 |  |        | -         |  |             |  
|Isagen S.A.                                                     |  |        | 12,689    |  |             |  
|Corporacion Autonoma Regional del Rio Grande de la Magdalena    |  |        | -         |  |             |  
|U.A.E. Agencia Nacional de Hidrocarburos                        |  |        | 61        |  |             |  
|Interconexion Electrica S.A.                                    |  |        | 536,222   |  |             |  
|Empresas Publicas de Medellín                                   |  |        | 9,168     |  |             |  
|Ministerio de Minas y Energia                                   |  |        | 50,401    |  |             |  
|Contraloria General de la Republica                             |  |        | -         |  |             |  
|E.S.P. Empresa de Energia de Bogotá  S.A.                       |  |        | 968,735   |  |             |  
|Ministerio de Hacienda y Credito Público                        |  |        | 586,870   |  |             |  
|Instituto Colombiano de Bienestar Familiar                      |  |        | -         |  |             |  
|E.S.P. Generadora y Comercializadora de Energia del Caribe S.A. |  |        | 11,184    |  |             |  
|Entidades Territoriales                                         |  |        | 63,217    |  |             |  
|Others                                                          |  |        | 10,178    |  |             |  
|                                                                |  | $      | 7,147,258 |  |             | $







F-92







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Other transactions with related parties
during 2013, 2012 and 2011 are:





|                                                       |  | 2013   |        |   | 2012     |   |           | 2011   | 
|------------------------------------------------------ |  | ------ | ------ | - | -------- | - | --------- | ------ | 
|                                                       |  | Income |        |   | Expenses |   |           | Income | 
|Banco Agrario de Colombia                              |  |        | -      |   |          |   | 11,641    |        | 
|Direccion de Impuestos y Aduanas Nacionales            |  |        | 19     |   |          |   | 17,828    |        | 
|Isagen S.A.                                            |  |        | 238    |   |          |   | -         |        | 
|Unidad de Planeacion Minero Energetica                 |  |        | -      |   |          |   | 7,282     |        | 
|Fondo Nacional Ambiental                               |  |        | 11     |   |          |   | 865       |        | 
|U.A.E. Agencia Nacional de Hidrocarburos               |  |        | 1,950  |   |          |   | 317,060   |        | 
|Corporacion Autonoma Regional de la Orinoquia          |  |        | 4      |   |          |   | 631       |        | 
|E.S.P. Empresa de Energia del Casanare - Enerca S.A.   |  |        | 686    |   |          |   | 137       |        | 
|Fondo Rotario de la Policia Nacional                   |  |        | -      |   |          |   | 13,093    |        | 
|Fiduciaria la Previsora S.A.                           |  |        | 36     |   |          |   | 854       |        | 
|Empresas Publicas de Medellín                          |  |        | 26,511 |   |          |   | 641       |        | 
|Ministerio de Minas y Energia                          |  |        | 331    |   |          |   | -         |        | 
|Contraloria General de la Republica                    |  |        | -      |   |          |   | 88,786    |        | 
|Ministerios de Hacienda y Crédito Público              |  |        | -      |   |          |   | 126,836   |        | 
|E.S.P. Empresa de Acueducto y Alcantarillado de Bogotá |  |        | 45     |   |          |   | 9         |        | 
|Instituto Colombiano de Bienestar Familiar             |  |        | -      |   |          |   | 6,621     |        | 
|E.S.P. Aguas de Barrancabermeja S.A.                   |  |        | -      |   |          |   | 13,000    |        | 
|E.S.P. Transportadora de Gas Internacional S.A.        |  |        | 736    |   |          |   | 330       |        | 
|Fuerzas Militares                                      |  |        | -      |   |          |   | 280,665   |        | 
|Entidades Territoriales                                |  |        | -      |   |          |   | 79,309    |        | 
|Others                                                 |  |        | (1     | ) |          |   | 41,096    |        | 
|                                                       |  | $      | 30,566 |   |          | $ | 1,006,684 |        | 





|xxviii. | FAIR VALUE
|------- | ----------



Accounting standards for fair value measurement
(ASC 820) establish a framework for measuring fair value and stipulate disclosures about fair value measurements. The standards
apply to recurring and non-recurring financial and non-financial assets and liabilities that require or permit fair-value measurements.
Among the required disclosures is the fair-value hierarchy of inputs the Company uses to value an asset or a liability. The three
levels of the fair-value hierarchy are described as follows:



Level 1: Quoted prices (unadjusted) in
active markets for identical assets and liabilities. For the Company, Level 1 inputs include marketable securities that are actively
traded.



Level 2: Inputs other than Level 1 that
is observable, either directly or indirectly. For the Company, Level 2 inputs include quoted prices for similar assets, prices
obtained through third-party broker quotes, and prices that can be corroborated with other observable inputs for substantially
the complete term of a contract.



Level 3: Unobservable inputs - The Company
does not use Level 3 inputs for any of its recurring fair-value measurements. Level 3 inputs may be required for the determination
of fair value associated with certain non-recurring measurements of non-financial assets and liabilities. The Company uses Level
3 inputs to determine the fair value of certain non-recurring non-financial assets.



F-93







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The fair value hierarchy for recurring
assets measured at fair value at December 31, 2013, and December 31, 2012, is as follows:



|                                                                           |  |      |           |   | Fair Value at Reporting Date Using                  |   |           |                                  |  |   | Fair Value at Reporting Date Using |  
|-------------------------------------------------------------------------- |  | ---- | --------- | - | --------------------------------------------------- | - | --------- | -------------------------------- |  | - | ---------------------------------- | -
|                                                                           |  |      |           |   | Quoted Pricein
    ActiveMarkets forIdenticalAssets |   |           | SignificantOtherObservableInputs |  |   | SignificantUnobservableInputs      |  
|Description                                                                |  | 2013 |           |   | (Level 1)                                           |   |           | (Level 2)                        |  |   | (Level 3)                          |  
|ASSETS                                                                     |  |      |           |   |                                                     |   |           |                                  |  |   |                                    |  
|Available for sale debt securities                                         |  |      |           |   |                                                     |   |           |                                  |  |   |                                    |  
|Securities issued by mixed – economy governmental
    entities             |  | $    | 1,504,957 |   |                                                     | $ | 1,504,957 |                                  |  | $ | -                                  |  
|Securities issued or secured by Colombian government                       |  |      | 210,493   |   |                                                     |   | 210,493   |                                  |  |   | -                                  |  
|Securities issued or secured by government sponsored enterprise
    (GSEs) |  |      | 42,129    |   |                                                     |   | 42,129    |                                  |  |   | -                                  |  
|Securities issued or secured by financial entities                         |  |      | 10,167    |   |                                                     |   | 10,167    |                                  |  |   | -                                  |  
|Securities issued or secured by financial entities                         |  |      | 641,658   |   |                                                     |   | -         |                                  |  |   | 641,658                            |  
|Other debt securities                                                      |  |      | 9,286     |   |                                                     |   | 9,286     |                                  |  |   | -                                  |  
|Securities issued or secured by USA government                             |  |      | 73,794    |   |                                                     |   | 73,794    |                                  |  |   | -                                  |  
|Total available for sale debt securities                                   |  | $    | 2,492,484 |   |                                                     | $ | 2,492,484 |                                  |  | $ | 641,658                            |  
|Short-term Investments – held to maturity securities:                      |  |      |           |   |                                                     |   |           |                                  |  |   |                                    |  
|Securities issued or secured by Colombian government                       |  |      | 98,039    |   |                                                     |   | -         |                                  |  |   | 98,039                             |  
|Other debt securities                                                      |  |      | 1,692     |   |                                                     |   | -         |                                  |  |   | 1,692                              |  
|Total Short-term Investments classified as
    held to maturity            |  | $    | 99,731    |   |                                                     | $ | -         |                                  |  | $ | 99,731                             |  
|Derivatives                                                                |  |      |           |   |                                                     |   |           |                                  |  |   |                                    |  
|Option                                                                     |  |      | (45       | ) |                                                     |   | -         |                                  |  |   | (45                                | )
|Swap                                                                       |  |      | -         |   |                                                     |   | -         |                                  |  |   | -                                  |  
|FX Forward                                                                 |  |      | -         |   |                                                     |   | -         |                                  |  |   | -                                  |  
|Total derivatives                                                          |  |      | (45       | ) |                                                     |   | -         |                                  |  |   | (45                                | )
|Total Recurring Assets
    at fair value                                   |  | $    | 2,592,170 |   |                                                     | $ | 1,850,826 |                                  |  | $ | 741,344                            |  



The fair value plan assets



Medical, Education and Severance plans
are unfunded. Pension and pension bonds plans are covered by assets in five trust funds with the following investment allocation:





|Investment                                                        |  | 2013 |            |  | Level | 
|----------------------------------------------------------------- |  | ---- | ---------- |  | ----- | 
|                                                                  |  |      |            |  |       | 
|Colombian government treasury bonds in COP                        |  | $    | 3,099,060  |  |       | 
|Other securities, liquidity, non-governmental entity bonds in COP |  |      | 978,427    |  |       | 
|Colombian government treasury bonds in COP                        |  |      | 472,085    |  |       | 
|Other securities, liquidity, non-governmental entity bonds in COP |  |      | 6,143,307  |  |       | 
|Colombian government treasury bonds in USD                        |  |      | 175,791    |  |       | 
|Other securities, liquidity, non-governmental entity bonds in USD |  |      | 562,401    |  |       | 
|Other securities, liquidity, non-governmental entity bonds in USD |  |      | 19,271     |  |       | 
|Total                                                             |  | $    | 11,450,342 |  |       | 







The fair value of the plan assets is calculated
using the information published by INFOVALMER, a renowned trustworthy financial price provider authorized by the Colombian Financial
Regulator (Superintendencia Financiera de Colombia). Accordingly, there are two methodologies to calculate the prices of the securities:
Average Price and Estimated price.



The Average Price is calculated mainly
from representative market transactions carried through electronic platforms approved and supervised by the named regulator. The
Investments that reflect this condition are located under level 1, bearing in mind that they include marketable securities that
are actively traded. Likewise, the Estimated Price is calculated for investments that do not reflect enough information to estimate
an average market price, replicating quoted prices for similar assets or prices obtained through third-party broker quotes. This
estimated price is also given by INFOVALMER as a result of the application of robust methodologies approved by the Financial Regulator
and broadly used by the financial industry. The investments reflecting this condition are located under level 2.



The company apply this methodology since March 2013, for that reason, we do not provide a fair value disclose
classified by levels for 2012.





Under U.S. GAAP the Company classifies
as restricted assets, those assets where their availability depends on a court decision, contractual or legal restriction, such
as cash, trust funds or investments. The detail of restricted assets is as follows:



|Concept                    |  | 2013 |         |  | Level | 
|-------------------------- |  | ---- | ------- |  | ----- | 
|Investment securities      |  | $    | 336,714 |  |       | 
|Investment securities      |  |      | 34,673  |  |       | 
|Specific destination funds |  |      | 299,702 |  |       | 
|Cash                       |  |      | 57,857  |  |       | 
|Total                      |  | $    | 728,946 |  |       | 



F-94







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The most significant restricted assets
are related to Santiago de Las Atalayas Fund which are detailed as follows:



|Concept                        |  | 2013 |         |  | Level | 
|------------------------------ |  | ---- | ------- |  | ----- | 
|Investments available for sale |  | $    | 336,714 |  |       | 
|Investments available for sale |  |      | 34,673  |  |       | 
|Specific destination funds     |  |      | 73,467  |  |       | 
|Cash                           |  |      | 510     |  |       | 
|Total                          |  | $    | 445,364 |  |       | 



Other restricted assets like specific
destination, correspond to Oleoducto Bicentenario for $111,482 and Cenit Transporte y Logística for $20,210 classify both
in level 2.



Marketable Securities: The
Company calculates fair value for its marketable securities based on quoted market prices.



Derivatives: The Company’s
derivative instruments principally include foreign exchange and refined-product (asphalt) swaps, options and forward contracts,
principally with financial institutions and other oil and gas companies, the fair values for which are obtained from third-party
broker quotes, industry pricing services and exchanges.



The Company obtains multiple sources of
pricing information for the Level 2 instruments. Since this pricing information is generated from observable market data, it has
historically been very consistent. The Company does not materially adjust this information.



The fair value hierarchy for non-recurring
assets measured at fair value at December 31, 2013 is as follows:



|                                        |  |      |           |  | Fair Value Measurements Using                                      |   |   |                                                    | 
|--------------------------------------- |  | ---- | --------- |  | ------------------------------------------------------------------ | - | - | -------------------------------------------------- | 
|Description                             |  | 2013 |           |  | Quoted Price in
     Active Markets  for Identical  Assets Level 1 |   |   | Significant  Other
     Observable  Inputs Level 2 | 
|Goodwill                                |  | $    | 930,023   |  |                                                                    | $ | - |                                                    | 
|Production fixed assets with impairment |  |      | 94,193    |  |                                                                    |   | - |                                                    | 
|Total Non-Recurring Assets              |  | $    | 1,024,216 |  |                                                                    | $ | - |                                                    | 



Impairment of“Goodwill”-During 2011, Ecopetrol performed an impairment test of goodwill which showed that goodwill had been impaired in Propilco by
$46,691, In 2012 it was cero. In 2013, Ecopetrol performed an impairment test on the recognized goodwill, resulting in a Propilco
impairment of $280,489. During 2013, lower supply from Ecopetrol increased the variable costs, as the company switched their
raw material suppliers.  Furthermore, the company performance was challenged by shifts in the petrochemical markets, as a
result  of new shale gas discoveries in the U.S. and low costs products coming from Asia.



Impairment of “Properties, plant
and equipment”- During 2013 and in accordance with the accounting standard for the impairment or disposal of long-lived
assets (ASC 360), long-lived assets “held and used” with a carrying amount of $139,813 were written down to a fair
value of $94,193, resulting in a before-tax loss of $45,620. The fair values were determined from internal cash-flow models, using
discount rates consistent with those used by the Company to evaluate cash flows of other assets of a similar nature. The respective
long-lived assets were reviewed for impairment on a field-by-field basis.



Assets and Liabilities Not Required to
Be Measured at Fair Value



The Company holds cash and cash equivalents.
The instruments held are primarily time deposits and money market funds. The fair values reflect the cash that would have been
received or paid if the instruments were settled at year-end. Cash equivalents had carrying/fair values of $8,750,039 and $7,972,335
at December 31, 2013 and 2012, respectively. Fair values of other financial instruments at the end of 2013 and 2012
were not material.



The Company’s financial instruments
that are exposed to concentrations of credit risk consist primarily of cash and accounts receivables. The carrying value of cash
and accounts receivable reflects management’s assessment of credit risk. As of December 31, 2012 and 2013, cash and cash
equivalents includes balances in savings and checking accounts, as well as term deposits and certificates of deposit, placed primarily
with governments and financial institutions with strong investment grade ratings.



The carrying amounts of the Company’s
accounts receivable, accounts payable and current notes payable approximate fair value because they have relatively short-term
maturities and bear interest at rates tied to market indicators, as appropriate. The Company’s long-term debt consists
of debt instruments that bear interest at fixed or variable rates tied to market indicators.



F-95





Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The carrying amount and estimated fair
values of the Company’s financial instruments that are not recognized in the balance sheets at fair value as of December
31 are as follows:



|                                                |  | 2013           |            |  |                     |   |            | 2012                    |  |  |                                                  | 
|----------------------------------------------- |  | -------------- | ---------- |  | ------------------- | - | ---------- | ----------------------- |  |  | ------------------------------------------------ | 
|Description                                     |  | CarryingAmount |            |  | EstimatedFair Value |   |            | Fair
    valuehierarchy |  |  | CarryingAmount                                   | 
|Long-term
    notes payable                     |  | $              | 11,284,800 |  |                     | $ | 10,757,433 |                         |  |  | Level
                                         2 | 
|Long-term
    debt (including current portion): |  | $              | 9,907,320  |  |                     | $ | 10,998,186 |                         |  |  | Level
                                         1 | 
|Total                                           |  | $              | 21,192,120 |  |                     | $ | 21,755,619 |                         |  |  |                                                  | 



|xxix. | SUPPLEMENTAL INFORMATION
    ON OIL AND GAS PRODUCING ACTIVITIES (UNAUDITED)
|----- | ----------------------------------------------------------------------------



In accordance with the requirements of
the United States Securities and Exchange Commission (SEC), Accounting Standards Codification 932 and the ASU- 2010-03 “Oil
and Gas reserve Estimation and Disclosures” rule, this section provides supplemental information on oil and gas exploration
and producing activities of the Company. The information included in items (i) through (iii) provides historical cost information
pertaining to costs incurred in exploration, property acquisitions and development, capitalized costs and results of operations.
The information included in items (iv) and (v) presents information on Ecopetrol’s estimated net proved reserve quantities,
standardized measure of estimated discounted future net cash flows related to proved reserves, and changes in estimated discounted
future net cash flows.



The following information corresponds
to Ecopetrol’s oil and gas producing activities at December 31 2013, 2012 and 2011 in direct and joint operations.



Under the SEC final rule, optional disclosure
of possible and probable reserves is allowed. But, the Company opted not to do so. Ecopetrol estimated its reserves without considering
non-traditional resources.



Table i – Capitalized costs relating
to oil and gas producing activities



|                                                                |  | Year ended December 31 |            
|--------------------------------------------------------------- |  | ---------------------- | -----------
|                                                                |  | 2013                   |            
|Natural and environmental properties                            |  | $                      | 30,639,705 
|Wells, equipment and facilities – property, plant and equipment |  |                        | 11,714,769 
|Construction in progress                                        |  |                        | 8,064,129  
|Accumulated depreciation, depletion and amortization            |  |                        | (22,647,249
|Net capitalized costs                                           |  | $                      | 27,771,354 



In accordance with ASC 410-20, these natural
and environmental costs include the asset retirement obligations amounting $12,598, $80,244, and $79,930, during 2013, 2012 and
2011, respectively.



For 2012, we disclosed an amount increased
in $19,014 due to a difference between our ARO tool and the accounting system. According to ASC 250, we consider this difference
is not material.



Table ii – Costs incurred in
oil and gas exploration and development activities



Costs incurred are summarized below and
include both amounts expensed and capitalized in the corresponding period.



|                                       |  | Year ended December 31 |           
|-------------------------------------- |  | ---------------------- | ----------
|                                       |  | 2013                   |           
|Acquisition of proved properties (1)   |  | $                      | 336,954   
|Acquisition of unproved properties (2) |  |                        | -         
|Exploration costs                      |  |                        | 2,486,283 
|Development costs                      |  |                        | 9,724,279 
|Total costs incurred                   |  | $                      | 12,547,517



| | (1) | Represents the scheduled buy-in
                                         costs paid to Murphy Oil (Operator) to participate in the Dalmatian and Gunflint projects
                                         in 2013. For 2011 includes wells, equipment and facilities associated with Equion.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | Represents the scheduled buy-in
                                         costs paid to Murphy Oil (Operator) to participate in the Dalmatian project in 2012 and
                                         wells, equipment and facilities associated with Caño Sur in 2011.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-96







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Table iii Results of operations for
oil and gas producing activities



|                                               |  | 2013 |            |   | 2012 |   |            | 2011 | 
|---------------------------------------------- |  | ---- | ---------- | - | ---- | - | ---------- | ---- | 
|Net revenues                                   |  |      |            |   |      |   |            |      | 
|Sales                                          |  | $    | 44,727,535 |   |      | $ | 29,515,227 |      | 
|Transfers                                      |  |      | 5,601,988  |   |      |   | 12,980,714 |      | 
|Total                                          |  | $    | 50,329,523 |   |      | $ | 42,495,941 |      | 
|                                               |  |      |            |   |      |   |            |      | 
|Production cost (1)                            |  |      | 6,752,329  |   |      |   | 5,361,603  |      | 
|Depreciation, depletion and amortization (2)   |  |      | 3,439,227  |   |      |   | 3,365,845  |      | 
|Other production costs (3)                     |  |      | 15,387,409 |   |      |   | 6,502,268  |      | 
|Exploration expenses (4)                       |  |      | 1,473,261  |   |      |   | 1,392,834  |      | 
|Other expenses (5)                             |  |      | 2,257,494  |   |      |   | 1,369,032  |      | 
|Total                                          |  | $    | 29,309,720 |   |      | $ | 17,991,582 |      | 
|Income before income tax                       |  |      | 21,019,803 |   |      |   | 24,504,359 |      | 
|Income tax expenses                            |  |      | (7,777,327 | ) |      |   | (8,064,384 | )    | 
|Results of operations for producing activities |  | $    | 13,242,476 |   |      | $ | 16,439,975 |      | 



Note: Effects of naphtha addition are
included into results of operations in the table above. During 2013, 2012 and 2011 the additional total barrels (million boe)
were 25.1, 19.4 and 15.4, respectively.



|(1) | Production costs are lifting
    costs incurred to operate and maintain productive wells and related equipment and facilities, including costs such as operating
    labor, materials, supplies, and fuel consumed in operations and the costs of operating natural gas liquids plants. In addition,
    it includes accretion expense related to the asset retirement obligations that were recognized during 2013, 2012, and 2011,
    amounting approximately $159,988, $150,754 and $ 133,796, respectively. The Company’s results of operations from oil
    and gas producing activities for the years ending December 31, 2013, 2012 and 2011 are shown above.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(2) | In accordance with ASC
    410-20, the expense related to asset retirement obligations that were recognized during 2013, 2012 and 2011 in depreciation,
    depletion and amortization, amounted approximately to $92,406, $131,342 and $28,676, respectively.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(3) | Corresponds to transportation
    costs and naphtha that are not part of the Company ́s lifting cost.
|--- | ----------------------------------------------------------------------------------------------------



|(4) | Exploration expenses include
    the costs of geological and geophysical activities as well as the non-productive exploratory wells.
|--- | ------------------------------------------------------------------------------------------------------------------------------------



|(5) | Corresponds to administration
    and marketing expenses.
|--- | ---------------------------------------------------------



During 2013, 2012 and 2011, respectively,
the Company transferred approximately 11%, 31% and 34% of its crude oil and gas production; (percentages based on the value sales
in Colombian pesos) to intercompany business units. Based on volume, those transfers were 36%, 39%, and 42%, respectively (including
Reficar). The intercompany transfers were recorded at values equal to the Company’s market prices.



Table iv – Reserve information



The reserve information presented in this
section is based on the definitions and rules used for U.S. GAAP purposes. The estimates for proved oil and gas reserves used
in the preparation of the consolidated financial statements were prepared by Ecopetrol’s engineers, audited in a 99% by
the “external engineers”.



Reserves are first estimated internally.
This process is supervised and coordinated by the corporate manager of reservoirs, a geologist who holds a master’s degree
in geology and has more than 20 years of experience in projects associated with reservoir characterization and development, estimation,
and reporting of reserves. The employees involved in the reserves process meet the Society of Petroleum Engineers, or SPE, qualifications
for reserves estimators. Internally estimated reserves are submitted for an external audit process, which was conducted by the
External Engineers (Ryder Scott, DeGolyer and MacNaughton and Gaffney, Cline & Associates). According to our corporate policy,
we report the reserves values obtained from the External Engineers.



The reserves process ends when the Reserves
Directorate who consolidates the results and presents them to the Reserves Committee, whose members are the Chief Financial Officer,
the Exploration and Production Executive Vice-President and the Vice-President of Strategy. Finally, results are presented to
the Audit Committee of the Board of Directors and approved by the Board of Directors.



Information concerning the technical definitions
used for the estimated proved reserves is included in this annual report. The information provided in this annual report about
our 2013 net proved reserves is based on the 2013 audited reserve reports for 99% of our total reserves prepared by experts under
the SEC definitions and rules. The remaining 1% corresponds to calculations made by us internally using SEC definitions and rules
set forth in Rule 4-10(a) of Regulation S-X and the disclosure guidelines contained in the SEC’s “Modernization of
Oil and Gas Reporting” final rule dated December 31, 2008 and effective as of January 1, 2010.



F-97







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Our 2013 crude oil and natural gas net
proved reserves include reserves from production assets located in Colombia regarding the Hocol and Equion’s assets, United
States and Peru.



The Company’s proved reserves as
of December 31, 2013, 2012 and 2011 are based on the SEC average price methodology for U.S. GAAP purposes, which mirrors the average
price methodology used by the Company in Colombia during this period.



Future development, abandonment and production
costs were computed by estimating the expenditures to be incurred in developing, producing, and abandoning proved oil and gas
reserves at the end of the year, based on year-end costs. Future income taxes were computed by applying statutory tax rates to
the estimated net pre-tax cash flows after consideration of tax basis and tax credits and carry forwards.



Discounted future net cash flows are calculated
using 10% mid period discount factors. This discounting requires a year-by-year estimate of when the future expenditures will
be incurred and when the reserves will be produced.



The valuation methodology prescribed under
ASU 2010-03 and ASU-2010-14 requires assumptions as to the timing and amount of future development and production costs. The calculations
are made as of December 31 each year and should not be relied upon as an indication of the Company’s future cash flows or
the value of its oil and gas reserves.



Ecopetrol used deterministic methods that
are commonly used internationally to estimate reserves. These methods have some uncertainty in degradation, and thus, the estimates
should not be interpreted as being exact amounts. However, the estimates used to evaluate reserves is considered reliable.



Estimates of reserves were prepared by
geological and engineering methods commonly used in the oil industry. The method or combination of methods used in the analysis
of reserves was adopted from experience with similar reserves, stage of development, quality and completeness of basic data and
production history.



The majority of the producing proved reserves
were estimated by applying appropriate decline curves or other performance relationships. In analyzing decline curves, reserves
were estimated by calculating economic limits that are based on current economic conditions. In certain cases, where the methods
previously employed could not be used, reserves were estimated by analogy with similar reserves where more complete data was available.



Most of the Company’s activities
and reserves are located in Colombia. The Colombian Nation is the owner of all mineral interests located in Colombia. The Company
and, by extension of joint association contracts, its partners, are given the right to explore, develop, produce and sell those
reserves, but do not own them. The reserve quantities and their standardized measure, presented in the following tables, represent
those reserves and their estimated value that the Company has the right to extract and sell.



The information provided does not represent
management’s estimate of the Company’s expected future cash flows or value of proved oil and gas reserves. Estimates
of proved reserve quantities involve uncertainty and change over time as new information becomes available.



The table below sets forth the Company’s
total proved oil and gas reserves together with their changes therein as of and for the years ended December 31, 2013, 2012 and
2011. The estimates (oil in million barrels, gas in billion cf, gas converted to million barrels at 5.7 billion cf per million
barrels) using the SEC rules in effect for each respective year.



F-98





Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



The following is the reserve quantity
information:



|                                |  | 2013                |         |   | 2012       |  |         | 2011             | 
|------------------------------- |  | ------------------- | ------- | - | ---------- |  | ------- | ---------------- | 
|                                |  | Oil                 |         |   | Gas        |  |         | Total            | 
|                                |  | million
    barrels |         |   | billion cf |  |         | million 
    boe | 
|Proved Reserves:                |  |                     |         |   |            |  |         |                  | 
|Beginning of year               |  |                     | 1,370.3 |   |            |  | 2,886.4 |                  | 
|Revisions of previous estimates |  |                     | 172.7   |   |            |  | 337.5   |                  | 
|Improved recovery               |  |                     | 23.2    |   |            |  | 19.9    |                  | 
|Purchases of minerals in place  |  |                     | 7.5     |   |            |  | 11.0    |                  | 
|Extensions and discoveries      |  |                     | 66.2    |   |            |  | 49.3    |                  | 
|Sales of minerals in place      |  |                     | (0.6    | ) |            |  | (12.3   | )                | 
|Production                      |  |                     | (205.7  | ) |            |  | (223.5  | )                | 
|End of year                     |  |                     | 1,433.6 |   |            |  | 3,068.4 |                  | 
|                                |  |                     |         |   |            |  |         |                  | 
|Proved developed reserves:      |  |                     |         |   |            |  |         |                  | 
|Beginning of year               |  |                     | 933.3   |   |            |  | 2,535.9 |                  | 
|End of year                     |  |                     | 933.0   |   |            |  | 2,663.3 |                  | 
|Proved undeveloped reserves:    |  |                     |         |   |            |  |         |                  | 
|Beginning of year               |  |                     | 437.0   |   |            |  | 350.6   |                  | 
|End of year                     |  |                     | 500.6   |   |            |  | 405.0   |                  | 



Revisions



In 2013, net revisions increased
reserves by 231.9 million boe. The main revisions are in Colombian fields. Our most important heavy crude oil projects in Castilla,
Chichimene, Rubiales and Quifa Fields drove a 91.7 million boe increase in reserves. New development projects in Castilla Field
units K1 and K2 caused a 68.2 million boe increase in reserves and development activities and improved reservoir performance in
Chichimene, Rubiales and Quifa Fields accounted for a 23.4 million boe increase.



Improved performance in natural
sales gas in Cupiagua Field accounted for a 45.5 million boe increase in reserves and, in Pauto field, accounted for a 9.7 million
boe increase in reserves. Revisions in Yarigui, Tisquirama, Provincia, Galan, San Roque and Cusiana Fields as a result of better
production performance and drilling activities accounted for a 32.4 million boe increase in reserves.



The revisions described above
accounted for 77% of the increase in reserves due to revisions in 2013. Revisions of the remaining 23% (52.7 million boe) were
caused from varying increases and decreases from other fields.



Improved Recovery



In 2013, improved recovery
increased reserves by 26.7 million boe. The improved recovery additions in 2013 were associated with the continued development
of water flood projects through existing wells, though additional drilling may be required to fully optimize the development configuration.
The main additions were in Yarigui field representing a 6.7 million boe increase, Tibu field representing 5.4 million boe increase
and Peñas Blancas Field representing 4.9 million boe increase.



Extensions and Discoveries



The Company’s extensions
and discoveries during 2013 amounted to 74.9 million boe, which corresponded to 39.8 million boe of newly discovered fields and
35.1 million boe of extensions of proved acreage. The newly discovered fields corresponded to our Acacias, Caño Sur and
Vigia Sur fields.



In terms of the extensions
of proved acreage, which amounted to 35.1 million boe, 68% was associated with activities in the followings fields: 7.7 million
boe related to new proved areas in the Hocol ́s Mamey field; 8.8 million boe related to new proved areas in the Rubiales
and Quifa fields; and 7.4 million boe related to new proved areas in La Cira – Infantas fields. The remaining 32% corresponds
to smaller changes in several other Company fields.



Purchases



In 2013, purchases of participation
interests increased liquid volumes 9.4 million boe representing the acquisition of a 31.5% participation in Gunflint Field by
Ecopetrol America.



F-99







Ecopetrol S.A. and Subsidiaries

Notes to the Consolidated Financial Statements

Years ended December 31, 2013, 2012 and
2011



Sales



In 2013, sales of participation
interests decreased reserves 2.8 million boe, resulting from the sale of a portion of the Company's equity interest in the Dificil
and Entrerrios Fields in Colombia.



Of the total amount of proved undeveloped
reserves that we had at the end of 2012 (498 million boe), we converted approximately 147 million boe, or 29%, to proved developed
reserves during 2013, primarily associated with the development of crude oil projects through drilling and workovers in Castilla,
Rubiales, Pidemonte, La Cira Infantas, Quifa Suroeste, Apiay, Casabe, Suria and Palagua fields. These projects accounted for approximately
81% of the total conversion. The conversion of the remaining 19% is associated with development execution in other fields such
as the Ocelote, Suria Sur, Yarigui – Cantagallo and Gala fields, among others. The amount of investments made during 2013
to convert proved undeveloped reserves to proved developed reserves was US$2,352 million.



|Table v – | Standardized measure
    of discounted future net cash flows relating to proved oil and gas quantities and changes therein
|--------- | --------------------------------------------------------------------------------------------------------------------------



The standardized measure of discounted
future net cash flows, related to the above proved crude oil and natural gas reserves, is calculated in accordance with the requirements
of ASU 2010-03. Estimated future cash inflows from production under U.S. GAAP are computed by applying unweighted arithmetic average
of the first-day-of-the-month oil and gas price to year-end quantities of estimated net proved reserves.



|                                                         |  | 2013 |             |   | 2012 |   |             | 2011 | 
|-------------------------------------------------------- |  | ---- | ----------- | - | ---- | - | ----------- | ---- | 
|Future cash inflows                                      |  | $    | 264,155,176 |   |      | $ | 251,891,162 |      | 
|Future production cost                                   |  |      | (72,941,680 | ) |      |   | (68,593,660 | )    | 
|Future development costs                                 |  |      | (17,793,007 | ) |      |   | (12,811,379 | )    | 
|Future income tax expenses                               |  |      | (58,115,581 | ) |      |   | (55,445,509 | )    | 
|Future net cash flow                                     |  |      | 115,304,908 |   |      |   | 115,040,614 |      | 
|10% annual discount for estimated timing of cash flows   |  |      | (42,044,683 | ) |      |   | (42,457,937 | )    | 
|Standardized measure of discounted future net cash flows |  | $    | 73,260,225  |   |      | $ | 72,582,677  |      | 



The following are the principal sources
of change in the standardized measure of discounted net cash flows:





|                                                                                                          |  | 2013 |             |   | 2012 |   |             | 2011 | 
|--------------------------------------------------------------------------------------------------------- |  | ---- | ----------- | - | ---- | - | ----------- | ---- | 
|Net change in sales and transfer prices and in production (lifting) cost related
    to future production |  | $    | 11,751,390  |   |      | $ | 8,921,835   |      | 
|Changes in estimated future development costs                                                             |  |      | (5,387,485  | ) |      |   | 2,092,588   |      | 
|Sales and transfer of oil and gas produced during the period                                              |  |      | (43,577,194 | ) |      |   | (37,134,338 | )    | 
|Net change due to extension discoveries                                                                   |  |      | (142,673    | ) |      |   | 2,370,545   |      | 
|Net change due to purchase and sales of minerals in place                                                 |  |      | 55,199      |   |      |   | -           |      | 
|Net change due to revisions in quantity estimates                                                         |  |      | 15,600,101  |   |      |   | 3,017,004   |      | 
|Previously estimated development costs incurred during the period                                         |  |      | 6,176,479   |   |      |   | 5,928,223   |      | 
|Accretion of discount                                                                                     |  |      | 10,756,496  |   |      |   | 10,527,661  |      | 
|Timing and other                                                                                          |  |      | 7,387,316   |   |      |   | 6,564,830   |      | 
|Net change in income taxes                                                                                |  |      | (1,942,081  | ) |      |   | 1,293,602   |      | 
|Aggregate change in the Standardized measure of discounted future net
    cash flows for the year         |  | $    | 677,548     |   |      | $ | 3,581,950   |      | 







F-100