History and Company Profile

OGX is the largest Brazilian private sector oil and natural gas company in terms of offshore exploratory acreage, with concession blocks covering approximately 7,000 km² (1.7 million acres), as well as an onshore area of 21,500 km² that corresponds to a 70% participation interest in 7 onshore blocks in the Parnaíba Basin.

Since its inception, in June 2007, OGX has established a leading position in the Brazilian oil and natural gas exploration and production sector by acquiring a diversified portfolio of high potential exploration blocks.

In November 2007, OGX raised US$1.3 billion in an equity private placement, generating capital to purchase concession rights in the Ninth Bidding Round held by the ANP (Brazilian National Petroleum Agency). In this round, OGX acquired concession rights to 21 exploratory blocks in the Campos, Santos, Espírito Santo and Pará-Maranhão basins, comprising a total area of 6,400 km².

Planning to pursue additional growth opportunities, OGX also entered into a farm-in agreement for a 50% participating interest in an exploration block in the Santos Basin, totaling 6,800 km² of offshore exploratory acreage. In May 2009, the ANP approved an additional participation of 15%, increasing OGX’s working interest in the block to 65%.

In March 2008, OGX engaged DeGolyer & MacNaughton, a leading consultant in reserve certification for the oil and natural gas industry with over 70 years of experience, to prepare an appraisal report. Based on primarily 2D seismic data, the study indicated that the 22 exploratory blocks of the company contained total Risked Prospective Resources of 4.835 billion barrels of oil equivalent, considering an average probability of exploratory success of 27%. In November 2009, after the interpretation of recently-acquired the 3D seismic data and the acquisition of the seven blocks in the Parnaíba Basin, a new certification study was conducted by D&M, certifying Net Risked Prospective Resources of 6.672 billion of boe, based on an average probability of success of 34.5%, and Contingent Resources of 212 million boe.

In June 2008, OGX held its Initial Public Offering (IPO) whereby approximately R$6.7 billion were raised in a 100% primary offer, representing the largest IPO in Brazil’s history. The resources raised in the offering will be used to fund OGX’s exploration campaign and initial development of production. 

The execution of OGX’s Business Plan is well underway, with seismic data acquired for all the offshore exploratory blocks and all the major equipment and services necessary for the exploration campaign already procured. OGX has chartered five drilling rigs, seven vessels and two helicopters, as well as one onshore base in the city of Rio de Janeiro.

The month of August 2009 was marked by the commencement of drilling activities, with the drilling on the BM-S-29 block, located in the Santos Basin, where OGX holds 65% of participation interest and the operator Maersk, 35%. Oil and gas shows have been identified in this well, where drilling is still in progress. In September 2009, drilling on the block BM-C-43, located in the Campos Basin, signaled the beginning of the drilling campaign on our wholly-owned and operated blocks. This drilling resulted in a discovery of recoverable volume estimated between 500 million and 1.5 billion barrels. The third drilling, on the block BM-C-41, also located in the Campos Basin, is still in progress. In this well, evidence of hydrocarbons has been found in the Eocene and Albian reservoirs and a discovery estimated to be between 400 and 500 million barrels was made in the Upper Cretaceous reservoirs. The drilling of a fourth well, OGX-3, is also in progress. As a consequence, two of the five drilling rigs that OGX has contracted, Ocean Ambassador and Sea Explorer, are now in operation. Two other wells are expected to be drilled prior to the conclusion of 2009, part of a drilling campaign that contemplates a total of 79 wells through 2013.

OGX is a member of the EBX Group, the industrial group founded and under the leadership of Brazilian entrepreneur Eike F. Batista, who has a successful track record in developing new enterprises in the natural resources and infrastructure sectors.