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Company Announces Third Quarter 2012 Results


OGX, Brazil’s largest private oil and natural gas exploration company, releases its third quarter results for 2012. In the quarter, the company reached an important milestone, posting revenues from the sale of approximately 800,000 barrels for the first time since it began commercial production, as well as obtaining Operator A qualification, allowing it to operate in blocks located in deepwater and ultra-deepwater. The construction work at the Gas Treatment Unit (GTU), in the Parnaíba Basin, is moving ahead at a rapid pace, with the commissioning scheduled for the fourth quarter of this year.

“Production is progressing well and is on schedule in the Campos Basin, and a third production well in the Tubarão Azul Field will be connected in the coming weeks. In exploration, we began drilling new prospects in the Campos Basin where we continue to have strong expectations for our activities. In addition, we are continuing to develop the Tubarão Martelo Field, in the Campos Basin, and the Gavião Real Field project in the Parnaíba Basin where we expect to begin commercial gas production in early 2013. We expect to invest about US$1.2 billion towards capital expenditures in 2013 to continue delivering on our potential in both exploration and production,” said Luiz Carneiro, Chief Executive Officer of OGX.

See the company’s main numbers below:

Production – OGX production activities in the Campos Basin are progressing on schedule and reached an average daily production of 9.3 kboepd and a total production volume of 856,800 boe in 3Q12 in the Tubarão Azul Field. A third production well in this field is under completion and due to be connected to the FPSO OSX-1 in the coming weeks. The company is now concluding the drilling of three horizontal production wells in the Tubarão Martelo Field, the next area to begin offshore production, after the arrival of FPSO OSX-3 in the second half of 2013.

In the Parnaíba Basin (Maranhão), the drilling of all 16 production wells in the Gavião Real Field has already been concluded and they are in the process of completion and connection to the GTU, with a processing capacity of 7.5 million m³ of natural gas per day. After obtaining the Operating License from the Environmental and Natural Resources Secretary of the State of Maranhão (SEMA/MA) in September, OGX plans to begin in this quarter the commissioning of the GTU and the MPX Parnaíba Thermoelectric Power Plant turbines. Commercial generation of power will begin in 2013.

Exploration – In exploration, OGX has begun drilling new prospects in the Campos Basin and continues to have strong expectations for its activities. Also, in October, the company participated in Colombia’s 2012 National Hydrocarbon Agency (ANH) Round, and had the winning bid for another block in the Lower Magdalena Valley Basin.

Oil Sales – In July, OGX made the final delivery of a shipment of approximately 800,000 barrels under the Company’s first oil sale contract with Shell, marking the commencement of the Company’s revenues generation after the declaration of commerciality of the Tubarão Azul Field, resulting in sales revenues of R$150.7 million.

On October 15, following the declaration of commerciality and the conclusion of the Extended Well Test (EWT), the fourth shipment of approximately 800,000 barrels was delivered to Reliance Industries Ltd., one of the world’s largest refineries and India’s largest private company.

Earnings Results – OGX ended the third quarter of 2012 with sales revenues of R$ 150.7 million and negative EBITDA of R$ 51.6 million, due to the non-recording of the fourth shipment sold to the Indian company Reliance, on October 15. In the third quarter, OGX recorded a net loss of R$ 343.6 million. The result was largely impacted by accounting expenses with non-cash effect.

Cash Position – OGX ended 3Q12 with a solid cash position of R$ 5.1 billion (equal to US$2.5 billion).

Access the full release here.



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