Ecopetrol (EC) said late Thursday that it has received approval from Colombia's Ministry of Finance and Public Credit for a $1.25 billion five-year loan as part of its comprehensive debt management strategy.

The company said it will receive a loan of $350 million from Banco Bilbao Vizcaya Argentaria's (BBVA) New York branch, $350 million from Bank of America (BAC), $350 million from JP Morgan Chase (JPM), and $200 million from Bank of China's Panama branch.

Ecopetrol said that the loan will be repayable in four equal installments and bear a floating interest rate indexed to the secured overnight financing rate, under previously agreed terms.

Proceeds will be used to repay a previous $1.2 billion loan originally secured to acquire Interconexion Electrica and to repay the remaining $50 million of a separate $500 million loan, Ecopetrol said.