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OGX 2013 First Quarter Results



  OGX 2013 First Quarter Results

Business Wire

RIO DE JANEIRO -- May 10, 2013

OGX Petróleo e Gás Participações S.A. (Bovespa: OGXP3), Brazil’s largest
private oil and natural gas exploration company, announces its first quarter
results for the three months ended March 31, 2013.

Key Financial Metrics                     1Q 2013       4Q 2012    
Net Revenue (R$ mm)                       289           175        
EBITDA (R$ mm)                            74            (38)       
Net Profit (Loss) (R$ mm)                 (805)         (286)      
Realized oil price per barrel (US$)       103           104        
CAPEX (US$ mm)                            289           550        
Cash Position (US$ mm)                    1,148         1,655      
Production volume (kboepd)                10.9          10.2     
                                                                   

Luiz Carneiro, Chief Executive Officer of OGX, commented:

“OGX delivered a sequential improvement in its performance in the first
quarter of 2013, posting higher revenues and positive EBITDA for the first
time, while also achieving higher total production volume at the Tubarão Azul
Field in the Campos Basin, which totaled 954 thousand barrels of oil. OGX also
achieved total production of 4 million cubic meters of gas per day at the
Gavião Real Field, in the Parnaíba Basin, after the fourth turbine at the
Parnaíba I Thermo Power Plant has been synchronized with the National System.

“Despite this progress, the first quarter of 2013 was a challenging one for
OGX as operational issues led to production stoppages at the OGX-68HP and
TBAZ-1HP wells, along with intermittent production at the OGX-26HP well. We
continue to analyze the reservoir behavior, as well as the impact on total
estimated recoverable volume.

“As announced on May 7, 2013, the company has entered into an important
strategic partnership with Petronas, the Malaysian oil major, to jointly
exploit two blocks in the Campos Basin that encompass the Tubarão Martelo
Field besides Peró and Ingá accumulations. Under the transaction, Petronas
will acquire a 40% non-operating work interest in the two blocks, BM-C-39 and
BM-C-40, for a total value of US$850 million, and has an option to acquire a
5% stake of our company from our controlling shareholder, Mr. Eike Batista.
The partnership with Petronas, which has more than 32 billion barrels of
recoverable resources and produces about 2 million barrels of oil equivalent
per day, underscores the quality of our assets and our management team,
strengthens our cash position and secures additional funding to continue
developing our portfolio and pursuing new growth opportunities.”

SHORT TERM OUTLOOK

UPCOMING EVENTS

OGX has several important events planned for the coming months:

  * Continue the execution of the Discovery Evaluation Plans (PADs) by
    drilling appraisal wells and performing tests in the Campos and Santos
    basins
  * Continue the exploration and wildcat campaigns in the Parnaíba and
    Espírito Santo basins
  * Update our resource evaluation report
  * Continue to develop the Tubarão Martelo Field by preparing for OSX-3’s
    arrival and conclude studies for OSX-2’s development area
  * Commence drilling of the first development well in the Atlanta Field (BS-4
    Block) in 2H13
  * FPSOs OSX-2 and OSX-3 expected to arrive in the 3Q13 and first production
    wells expected to come on-stream by the end of the year

STRATEGIC PARTNERSHIP WITH PETRONAS

  * OGX has entered into an agreement with Petronas to sell a 40%
    non-operating work interest in the BM-C-39 and BM-C-40 blocks, located in
    the Campos Basin, for a total value of US$850 million. The blocks
    encompass the Tubarão Martelo Field (2C resources of 212 million barrels
    estimated by DeGolyer and MacNaughton in February 2012) and the Peró and
    Ingá accumulations. The transaction is subject to approval from Brazil’s
    National Petroleum, Natural Gas and Biofuels Agency (ANP) and the
    Brazilian Council for Economic Defense (CADE)
  * Upon financial closing of the transaction, US$250 million and an
    additional amount equivalent to 40% of the development costs of TBMT field
    incurred since May 1^st 2013 (capex and opex) will be paid directly to OGX
    (and will become immediately available for any purpose). The remaining
    US$600 million will be deposited on behalf of OGX into an escrow account
    and released as described below:

       * US$500 million upon first oil
       * US$50 million upon achievement of an aggregate production of 40
         kboepd
       * US$25 million upon achievement of an aggregate production of 50
         kboepd
       * US$25 million upon achievement of an aggregate production of 60
         kboepd

  * In addition to the stake in the BM-C-39 and BM-C-40 blocks, Petronas has
    an option to purchase 5% of OGX’s capital at a price of R$6.30 per share
    at any time until April 2015. Exercise of this option will not involve any
    issuance of new shares or imply dilution for minority shareholders since
    the shares will come from the current holdings of OGX´s controlling
    shareholder, Mr. Eike Batista

OPERATIONS REVIEW

HIGHLIGHTS

  * Attained total production volume of 954 thousand barrels of oil in the
    Tubarão Azul Field (Campos Basin) in 1Q13, up 5.1% on the previous quarter
  * 1.2 million barrels of oil sold in 1Q13, delivered in two different cargos
  * Third production well in the Tubarão Azul Field (Campos Basin), TBAZ-1HP,
    was connected to FPSO OSX-1 and commenced production on January 4, 2013
  * OGX-68HP well: operational issues in the electrical submersible pump (ESP)
    resulted in a 15 day stoppage of production in March. Repairs commenced in
    mid-April and its conclusion is expected for mid-May
  * TBAZ-1HP well: unstable electrical generation at OSX-1 along with lower
    than expected flow rate at the well led to intermittent operations and
    damage to the ESP resulting in an 11 day stoppage during March. Repairs to
    begin once OGX-68HP is back in operation
  * OGX-26HP well: 2 day stoppage at the well in March caused by unstable
    electrical generation at OSX-1. Well production has been periodically
    stopped since the beginning of April to prevent damages at the ESP, and
    its production is being monitored
  * Drilled and made the lower completion of six production wells in the
    Tubarão Martelo Field (Campos Basin). The first well is projected to come
    on-stream late 2013 after the arrival of FPSO OSX-3
  * Final stage of reservoir engineering for FPSO OSX-2 installation, with
    delivery scheduled for 2H13
  * Average net gas production of 3.2 kboepd, 5.5 kboepd, 6.8 kboepd and 12.1
    kboepd in January, February, March and April 2013, respectively, in the
    Gavião Real Field (Parnaíba Basin)
  * Achieved total production of 4.0 M m^3/d (~25 kboepd) in the Gavião Real
    Field after the fourth turbine at the Parnaíba I Thermo Power Plant has
    been synchronized with the National System on April 5, 2013

PRODUCTION - CAMPOS BASIN

  * Total production volume of 954 thousand barrels of oil in the Tubarão Azul
    Field in 1Q13
  * Sale of 1.2 million barrels of oil in 1Q13, distributed in two cargos

       * 779 thousand barrels of oil to ENAP, in January 2013
       * 425 thousand barrels of oil to BP, in February 2013

  * Sale of 394 thousand barrels of oil to Shell, in April 2013
  * Connection start-up of the third production well in the Tubarão Azul
    Field, TBAZ-1HP on January 4, 2013
  * Drilling and lower completion of six production wells concluded in the
    Tubarão Martelo Field
  * Final stage of reservoir engineering for FPSO OSX-2 installation, with
    delivery scheduled for 3Q13

Tubarão Azul Field Development

In March, production in the Tubarão Azul Field was mainly affected by
operational issues that caused damage to the ESP at wells OGX-68HP and
TBAZ-1HP, resulting in a 15 day stoppage and an 11 day stoppage, respectively.
Works to repair OGX-68HP have already commenced and are expected to complete
in mid-May. Work on the TBAZ-1HP well should commence once repairs on the
OGX-68HP have been completed. Production at both wells will remain interrupted
until the ESP overhauls are completed. Additionally, production at the
OGX-26HP well also stopped for 2 days in March as a result of unstable
electrical generation at FPSO OSX-1.

In the first two months of the year, before the operational issues occurred,
average daily production was 12.3 kboepd, while in March it decreased to 8.3
kboepd as a result of these issues.

In April after the OGX-26HP well returned to production, we noticed that the
gas oil ratio (GOR) increased, resulting in the ESP overheating. In order to
prevent any damage to the equipment, we decided to periodically stop the well
production, which led to intermittent operations, producing only during 16
days with an average daily flow rate of 3.4 kboepd, considering the effective
production days.

OGX’s technical team is currently analyzing the reservoir behavior to define
the next steps on the development of this field.

During 2013, we delivered the fifth, sixth and seventh shipments of
approximately 779 thousand barrels, 425 thousand barrels and 394 thousand
barrels, respectively. The first shipment was delivered to ENAP (Chile) on
January 5, the second to BP on February 7 and the third to Shell on April 6.

The table below shows the pro-forma OSX-1 EBITDA after the delivery of the
first six shipments.

Delivered       2012                                                             2013                   
cargos
                                                                                                         Overall
                1st ¹        2nd ¹       3rd          4th          Total 2012    5th         6th
                                                                                                         Total
Delivery        03/28/2012   4/21/2012   07/26/2012   10/15/2012                 5/1/2013    7/2/2013
Date
Operation       51 days      27 days     98 days      80 days                    73 days     39 days
Period
                                                                                                                      
Production
related to
the             547,376      246,809     789,774      809,495      2,393,454     779,110     425,313     3,597,877  
shipments -
in barrels
(bbls)
                                                                                                                      
R$ ('000)
Sales           118,003      55,996      150,686      174,707      499,392       165,000     89,634      754,026
Revenues
                                                                                                                      
Sales Taxes     -            -           -            -            -             -           -           -          
Royalties       (10,687  )   (4,938  )   (14,842  )   (15,772  )   (46,239   )   (15,351 )   (8,685  )   (70,275   )
Leasing         (24,078  )   (13,222 )   (52,708  )   (41,998  )   (132,006  )   (39,116 )   (20,868 )   (191,990  )
OSX             (13,944  )   (7,236  )   (28,071  )   (22,499  )   (71,750   )   (25,194 )   (12,471 )   (109,415  )
Services
Logistics       (12,005  )   (7,410  )   (27,795  )   (18,405  )   (65,615   )   (8,355  )   (4,310  )   (78,280   )
Freight
cost on         -            -           -            (5,831   )   (5,831    )   (3,877  )   (1,631  )   (11,339   )
sales
Others          (871     )   36          (1,183   )   (1,529   )   (3,547    )   (2,394  )   (1,200  )   (7,141    )
                                                                                                                      
EBITDA          56,418       23,226      26,087       68,673       174,404       70,713      40,469      285,586
                                                                                                                      
% EBITDA /      47.81    %   41.48   %   17.31    %   39.31    %   34.92     %   42.86   %   45.15   %   37.87     %
Revenues
EBITDA /
barrel -        103.07       94.11       33.03        84.83        72.87         90.76       95.15       79.38      
(R$/barrel)

    Note:
    ¹Sales occurred during the Extended Well Test and before the declaration
    of commerciality - not accounted in Results and recorded as a reduction of
    "Fixed Assets"
     

The following table demonstrates the effective daily rates (in USD) of each of
the costs associated with the FPSO OSX-1 operation, related to the operation
period in each of the first six delivered cargos:

Daily
Cost (USD     2012                            2013                   
'000)
              1st     2nd     3rd     4th     Avg.    5th     6th     Overall
              cargo   cargo   cargo   cargo   2012    cargo   cargo
                                                                      Average
                                                                       
Leasing       (268)   (262)   (268)   (259)   (264)   (263)   (263)   (264)
OSX           (155)   (143)   (143)   (139)   (145)   (169)   (157)   (151)
Services
Logistics     (134)   (147)   (141)   (113)   (134)   (56)    (54)    (108)
Others        (10)    1       (6)     (9)     (6)     (16)    (15)    (9)
                                                                       
Total         (567)   (551)   (557)   (520)   (549)   (504)   (489)   (531)
                                                                               

Tubarão Martelo Field Development

OGX has drilled and made the lower completion of six horizontal production
wells (TBMT-2HP, TBMT-4HP, TBMT-6HP, OGX-44HP, TBMT-8H and TBMT-10H). FPSO
OSX-3 is scheduled to arrive by 3Q13 and its first production well is expected
to come on-stream by 4Q13.

We have performed drill-stem tests on five production wells and the results
were in line with our expectations.

PRODUCTION – PARNAÍBA BASIN

  * Revenue generation commenced in January 2013, starting with gas dispatch
    for the synchronization of the first Parnaíba I Thermo Power Plant (TPP)
    turbine
  * Average net gas production of 3.2 kboepd, 5.5 kboepd, 6.8 kboepd and 12.1
    kboepd in January, February, March and April, respectively
  * Achieved total production of 4.0 M m^3/d (~25 kboepd) in the Gavião Real
    Field after synchronizing the fourth turbine at the Parnaíba I Thermo
    Power Plant with Brazil’s National Interconnected System (SIN) on April 5,
    2013

Gavião Real and Gavião Azul Field Development

In January 2013, OGX started gas dispatch for the synchronization of the first
Parnaíba I TPP turbine, initiating the project’s revenue generation only 16
months after the drilling of the first development well in the Parnaíba Basin.

In a 12-day production period in January with only one turbine synchronized,
we registered an average net gas production of 3.2 kboepd (0.5 M m³/d). In
February, operating with 2 turbines from February 9, we registered an average
net gas production of 5.5 kboepd (0.9 M m³/d). In March, the third turbine was
synchronized with the system on March 16 and we reached an average net gas
production of 6.8 kboepd (1.1 M m³/d). In April, operating with 4 turbines
synchronized from April 5, we registered an average net gas production of 12.1
kboepd (1.9 M m³/d) and the Thermal Power Plant Parnaíba I reached its total
installed capacity of 676 MW.

We have also started the drilling of two additional development wells: GVR-17
and GVR-18, which will be completed and connected to the production clusters
soon.

The table below shows the pro-forma GTU EBITDA after the three months of
operations. The pro-forma EBITDA margin of approximately 73% reflects the
asset’s profitability, still leaving room for margin increase with the full
ramp-up of our production, in particular in April and May, with the
synchronization of the fourth and fifth turbines.

                                                                   
GTU Parnaíba                       Jan-13     Feb-13     Mar-13     Total
Operation Period¹           From   20-Jan     26-Jan     26-Feb
                            To     25-Jan     25-Feb     25-Mar
                                                                              
OGX Maranhão gas                   3.62       35.42      44.49      83.53   
production - in Mm3
                                                                              
R$ ('000)
Revenues²                          4,259      18,504     16,516     39,279
                                                                              
Sales Taxes³                       (433   )   (2,088 )   (2,002 )   (4,523 )
O&M                                (1,089 )   (1,246 )   (1,262 )   (3,597 )
Royalties & Landowners'            (272   )   (1,038 )   (1,408 )   (2,718 )
right
                                                                              
EBITDA                             2,465      14,132     11,844     28,441
                                                                              
% EBITDA / Revenue                 57.88  %   76.37  %   71.71  %   72.41  %
EBITDA / Mm3 - (R$/Mm3)            681.71     398.97     266.20     340.49  

      Notes:
      ¹ Closing date for accounting numbers: 25^th day of the month
      ² Gross revenue composed by gas sales revenue and GTU rental revenue
      ³ Sales taxes composed by: PIS/COFINS/ICMS
       

EXPLORATION REVIEW

HIGHLIGHTS

  * Presented Declaration of Commerciality for the Pipeline, Fuji and Illimani
    accumulations to the ANP. The fields will be named Tubarão Gato, Tubarão
    Tigre and Tubarão Areia, with total estimated volume of oil in place of
    823 million barrels of oil (P50)
  * Submission of Discovery Evaluation Plans (PAD) to the ANP for Vesúvio,
    Viedma, Tulum and Itacoatiara accumulations in the Campos Basin, and for
    Curitiba, Belém and Natal accumulations in the Santos Basin
  * Drilled the first appraisal well, OGX-109, committed at the PAD for Viedma
    accumulation, where 6 meters of net pay was discovered in the Santonian
    section
  * Decided to not continue the exploration of the Cozumel and Cancun areas in
    the Campos Basin after not identifying the presence of hydrocarbons
  * Returned Tambora and Tupungato accumulations to the ANP as the Company
    decided not to continue its development
  * Made new and important discoveries of gas in the Parnaíba Basin: Fazenda
    Chicote (OGX-107) and São Raimundo (OGX-110) prospects, as well as Fazenda
    Santa Isabel (OGX-108), a wildcat adjacent to the OGX-88 (Bom Jesus)
    discovery

CAMPOS BASIN

The Company commenced the execution of the PADs by drilling the first
appraisal well, OGX-109, for the Viedma accumulation, situated in the Campos
Basin, where 6 meters of net pay was discovered in the Santonian section. OGX
is currently evaluating whether to continue exploring the area.

Following the submission of the Declaration of Commerciality of the Pipeline,
Fuji and Illimani accumulations, with total estimated volume of oil in place
of 823 million barrels of oil (P50), we should submit the fields’ Development
Plans. Currently, we also continue to work on the reservoir engineering for
the installation of FPSO OSX-2, with delivery scheduled for 2H13.

In March, we have decided to not continue the exploration of the Cancun and
Cozumel areas in the Campos Basin, BM-C-37 block, after not identifying
significant presence of hydrocarbons. In April, we returned the Tambora and
Tupungato accumulations, BM-C-41 block, as the Company decided not to continue
this development.

Furthermore, the ANP approved the PADs for the Vesuvio, Krakatoa and Honolulu
areas in blocks BM-C-38, BM-C-41, BM-C-42 and BM-C-43, and for Peró-Ingá areas
in block BM-C-40, enabling us to extend the exploration period for these
accumulations while we continue to wait for the approval of the submitted PADs
for Tulum and Itacoatiara areas.

PARNAÍBA BASIN

With two rigs focused on drilling exploratory wells and one completion rig, we
initiated the drilling of five new wells in 2013. Of these five, three are
wildcats: OGX-105, Rocha Lima prospect, a dry well; OGX-107, Fazenda Chicote
prospect, where we discovered gas; and OGX-110, São Raimundo prospect, where
we also discovered gas.

In addition, we commenced the drilling of two wildcat adjacent to the OGX-88
(Bom Jesus), named Fazenda Santa Isabel (OGX-108), where we discovered gas,
and SE Bom Jesus (OGX-111), which is still in progress.

In January 2013, we presented to the ANP the Declaration of Commerciality for
the Bom Jesus accumulation (named the Gavião Branco Field) after discovering
gas in four exploratory wells in the area. We estimate a total volume in place
between 0.2 and 0.5 Tcf of gas for the Gavião Branco Field.

In March 2013, after notifying to the ANP a gas discovery of approximately 66
net pay meters in the Fazenda Chicote prospect (OGX-107), we performed a
drill-stem test in the well and obtained a gas flow rate of 3.2 million cubic
meters per day in Absolute Open Flow (AOF). The interval tested was of only 19
meters (between 1,342 meters and 1,361 meters) in the Poti Formation and
lasted approximately 36 hours. The test also confirmed a low gas condensate
ratio (GCR), indicating dry gas and demonstrating the similarity of these
results with the previous tests carried out in the Gavião Real and Gavião
Branco fields. We are planning to continue the drilling campaign in this area
in the coming months.

SANTOS BASIN

In the coming days, OGX will begin the Curitiba PAD where we will perform a
drill-stem test at the OGX-94DA well, where we have already notified presence
of light oil and gas. The success of this test will be important for the
continuation of our exploration efforts in the Santos Basin, where we also
submitted PADs for the Belém and Natal accumulations.

In January, ANP approved the Development Plan for the Atlanta Field, in block
BS-4 where we have a 40% participating interest. The first production well is
expected for the second half of 2013 using the Ocean Star rig which is part of
our current fleet.

In March, the Company decided not to proceed with the development of the
Fortaleza accumulation and returned the BM-S-57 block to the ANP.

ESPÍRITO SANTO BASIN

Perenco, our partner and operator of the blocks in the Espírito Santos Basin,
commenced drilling of the exploration well, PERN-3, at the Caju prospect in
the BM-ES-39 block using the Ocean Star rig, which is part of our current
fleet. Another prospect in the BM-ES-40 block should commence after Caju’s
drilling has been concluded.

In March 2013, OGX returned the BM-ES-37 block to the ANP, in which OGX had a
50% stake.

COLOMBIA

In the first quarter, OGX concluded the 3D seismic processing in the VIM-5
block and we are currently analyzing the results. The first exploration well
in this block should be drilled in the beginning of 2014.

OTHER

EXPLORATION AND DEVELOPMENT EQUIPMENT

As part of our transition to a production-focused campaign in the Campos and
Santos basins, we returned the drilling rigs Ocean Lexington and ENSCO-5002 in
February and April, respectively.

Going forward, we expect to continue reducing our fleet, which is currently
comprised of 3 rigs. One of them, Ocean Star, is already being shared with
Perenco (OGX 50% / Perenco 40% / Sinochem 10%) and, after the conclusion of
the works in the Espírito Santo Basin, should be used for the development of
the Atlanta field and therefore shared with our partners in the consortium
(OGX 40% / Consortium 60%).

PEOPLE MANAGEMENT

As of March 31, 2013, OGX had 357 employees and 3,869 third party service
providers responsible for conducting all administrative, exploration and oil
and gas production activities, down approximately 33% year over year. In
addition to our strategy of contracting internationally respected suppliers to
conduct operating activities, we maintain a high-performance, streamlined
structure focused on managerial excellence and with broad experience in the
oil and gas sector.

FINANCIALS

The financial and operational data below is presented on a consolidated basis,
in accordance with the International Financial Reporting Standards (IRFS)
issued by the International Accounting Standards Board – IASB and, in reais
(R$), except where otherwise indicated.

Sales Revenues

The Company’s sales in the first quarter of 2013 totaled R$293 million. Of
this total, R$254 million corresponded to the sale of 1.2 million barrels from
the Tubarão Azul Field and R$39 million related to the sale of 84 M m^3 of gas
from the Gavião Real Field. R$4 million of taxes (ICMS, PIS and COFINS) were
incurred in the gas operation.

Net Income

We ended 1Q13 with net losses of R$805 million, largely without impact on
cash. This result is chiefly due to expenses of R$1,195 million related to dry
wells and sub-commercial areas relinquished to the ANP after the conclusion of
the exploratory period in March 2013, partially offset by the positive effect
of deferred income tax and social contribution of R$424 million.

Cash Expenditure

OGX expenditures on an accrual basis were US$322 million in the first quarter.
Compared to the previous quarter, the Company’s expenditure has significantly
decreased, in particular due to the Capex rationalization process that the
Company has begun with the plan of gradually returning our drilling rigs.

Cash Position

Despite our investing activities expenditures decline, our cash holdings
decreased approximately US$500 million, ending at US$1.15 billion in 1Q13. The
reduction was mainly driven by negative operational activities due to
increased disbursements with our recurring suppliers as a result of the
effective payment of previous accrued expenses - around R$400 million - as
reflected on our Trade Payables account.

Exploration Expenses

Exploration expenses decreased R$27 million compared with 4Q12. This change
was primarily the result of the reduction of the exploration campaign as part
of our transition to a production-focused campaign.

General and Administrative Expenses

General and administrative expenses decreased R$14 million compared with 4Q12,
driven by a reduction in headcount.

Dry and Sub-commercial Wells

In the first quarter of 2013, the Company posted an expense of R$1,195 million
with dry wells and sub-commercial areas. Of this amount, R$952 million
accounts for previously capitalized expenses, which include signature bonus
and expenses of drilled wells in relinquished areas. The remaining balance of
R$243 million refers to dry or sub-commercial wells.

Financial Result

The financial expense of R$103 million in 1Q13 is explained by: (a) the
un-capitalized interest on financing of R$119 million, partially offset by (b)
gains on financial investments of R$19 million.

Cost of Goods Sold

The cost of goods sold of R$138 million incurred with the oil sales is broken
down as: (a) expenses with leasing of R$60 million; (b) O&M services of R$38
million; (c) logistics of R$13 million; (d) royalties of R$24 million; and (e)
others of R$3 million.

The R$6.3 million cost of goods sold incurred with the gas sales is due to:
(a) O&M services of R$3.6 million; and (b) royalties and landowners’ right of
R$2.7 million.

Cash and Cash Equivalents

Cash and cash equivalents totaled R$2.3 billion (equivalent to about US$1.15
billion) on March 31, 2013, down R$1.1 billion from December 31, 2012. This
decrease is chiefly due to: (a) CAPEX of R$578 million; (b) payment of
interest totaling R$113 million; and (c) payment of recurring suppliers of
R$403 million; partially offset by (d) pro-forma EBITDA from FPSO OSX-1 of
R$111 million (5^th and 6^th cargos); and (e) pro-forma EBITDA from GTU
Parnaíba of R$28 million.

Property, Plant and Equipment (CAPEX)

Property, plant and equipment represented by capital expenditures during the
exploration and development phases include expenses related to drilling
campaigns and the acquisition of E&P equipment. From December 31, 2012 to
March 31, 2013, this balance increased by R$578 million.

Loans and Financing

The R$54 million decrease in the balance of loans and financing between
December 31, 2012 and March 31, 2013 is detailed in the loans and financing
table in the appendix.

Income Statement

                                       R$ ('000)
INCOME STATEMENT        1Q13           4Q12         ∆              1Q13           1Q12         ∆
                                                                                                             
Net revenue             289,391        174,707      114,684        289,391        -            289,391
                                                                                                             
Cost of goods           (144,259   )   (100,203 )   (44,056  )     (144,259   )   -            (144,259   )
sold (COGS) ¹
Exploration             (27,851    )   (54,784  )   26,933         (27,851    )   (89,202  )   61,351
expenses
Sales expenses          (5,508     )   (5,831   )   323            (5,508     )   -            (5,508     )
General and
administrative          (37,949    )   (52,121  )   14,172         (37,949    )   (54,266  )   16,317
expenses
                                                                                                             
EBITDA                  73,824         (38,232  )   112,056        73,824         (143,468 )   217,292
                                                                                                             
Depreciation            (38,776    )   (17,173  )   (21,603  )     (38,776    )   (1,533   )   (37,243    )
(part of COGS)
Amortization            (5,202     )   (4,522   )   (680     )     (5,202     )   (1,757   )   (3,445     )
(part of COGS)
Stock option            (20,566    )   (7,372   )   (13,194  )     (20,566    )   (35,334  )   14,768
Dry/subcommercial       (1,194,862 )   (231,238 )   (963,624 )     (1,194,862 )   (19,941  )   (1,174,921 )
wells/areas
Equity results          (479       )   -            (479     )     (479       )   -            (479       )
EBIT                    (1,186,061 )   (298,537 )   (887,524 )     (1,186,061 )   (202,033 )   (984,028   )
                                                                                                             
Financial revenue       24,435         43,145       (18,710  )     24,435         87,719       (63,284    )
Financial expense       (127,485   )   (149,637 )   22,152         (127,485   )   (94,769  )   (32,716    )
Net financial           (103,050   )   (106,492 )   3,442          (103,050   )   (7,050   )   (96,000    )
results
Currency exchange       66,160         1,788        64,372         66,160         31,070       35,090
Derivatives             (5,704     )   (1,909   )   (3,795   )     (5,704     )   (5,461   )   (243       )
                                                                                                             
EBT                     (1,228,655 )   (405,150 )   (823,505 )     (1,228,655 )   (183,474 )   (1,045,181 )
                                                                                                             
(-) Income tax          424,068        119,444      304,624        424,068        38,672       385,396
                                                                                                             
Net profit (loss)
for the year- Pro       (804,587   )   (285,706 )   (518,881 )     (804,587   )   (144,802 )   (659,785   )
forma
                                                                                                             
OGX Campos Merger       -              -            -              -              -            -
                                                                                                             
Net profit (loss)
for the year-           (804,587   )   (285,706 )   (518,881 )     (804,587   )   (144,802 )   (659,785   )
Book value
                                                                                                             
Attributed to:
Non controlling         5,818          (12,803  )   18,621         5,818          (12,399  )   18,217
interests
Controlling             (810,405   )   (272,903 )   (537,502 )     (810,405   )   (132,403 )   (678,002   )
shareholders

Note:
¹ This balance does not include parts of COGS related to depreciation,
amortization and royalties that are disclosed in specific lines of the table
above
 
 

Balance Sheet

                                            R$ ('000)
BALANCE SHEET   Mar 31,      Dec 31,                          Mar 31,       Dec 31,
                2013         2012                             2013          2012
ASSETS                                      LIABILITIES AND                  
                                            EQUITY
Current                                     Current
assets                                      Liabilities
Cash and cash   2,311,016    3,381,326      Trade payables    522,944       925,513
equivalents
                                            Taxes,
Escrow          15,180       14,963         contributions     28,617        22,894
deposits                                    and profit
                                            sharing payable
Taxes and                                   Salaries and
contributions   28,879       -              payroll charges   70,297        58,921
recoverable
Derivative                                  Loans and
financial       24,975       26,350         financings        136,967       84,534
instruments
Oil                                         Derivative
inventories     77,107       118,027        financial         2             1,416
                                            instruments
                                            Accounts
Other credits   106,226      94,686         payable to        84,244        100,845
                                            related parties
                                            Other accounts    23,576        20,096
                                            payable
                2,563,383    3,635,352
                                                              866,647       1,214,219
                                            Noncurrent
                                            Liabilities
                                            Loans and         7,854,127     7,960,166
                                            financings
                                            Provisions        218,250       210,887
Noncurrent
Assets
Inventories     231,895      206,511                          8,072,377     8,171,053
Taxes and                                   Shareholders’
contributions   199,080      215,311        Equity
recoverable
Deferred
income taxes    1,216,497    791,893        Capital stock     8,821,155     8,821,155
and social
contributions
Credits with                                Capital
related         180,514      179,454        reserves          191,013       178,793
parties
                                            Earnings          -             -
                                            reserves
                                            Currency
Investments     12,490       -              translation       38,583        42,571
                                            adjustments
                                            Retained
                                            earnings          (2,142,075)   (1,343,306)
                                            (deficit)
Fixed assets    9,756,663    10,027,389
                                            Portion
                                            attributed to     6,908,676     7,699,213
                                            controlling
                                            shareholders
                                            Portion
Intangible      1,713,223    2,060,438      attributed to     26,045        31,863
assets                                      non-controlling
                                            interests
                                                                                         
                13,310,362   13,480,996                       6,934,721     7,731,076
                                                                                         
                                            Total
Total Assets    15,873,745   17,116,348     Shareholders’     15,873,745    17,116,348
                                            Equity
                                                                                         
                                                                                         

Fixed Assets

                                              R$ ('000) 
FIXED ASSETS
                                                            
Balance as of December 31, 2012               10,027,389
                                                            
(+) CAPEX
Campos Basin                                  422,764
Santos Basin                                  10,969
Parnaíba Basin                                49,688
Espirito Santo Basin                          6,947
Pará Maranhão Basin                           3,974
Colombian Basins                              0
Corporate                                     83,854      
                                              578,196
                                                            
(+) Borrowing costs                           44,477
                                                            
(+) Asset retirement obligation               -
                                                            
(-) Gross margin EWT                          -
                                                            
(-) Disposals                                 -
                                                            
(-) Depreciation                              (37,189    )
                                                            
(-) Write off Dry/Subcommercial wells         (856,210   )
                                                            
Balance as of March 31, 2013                  9,756,663     
                                                            
                                                            

Loans and Financing

                                        R$ ('000) 
LOANS AND FINANCING
                                                      
Balance as of December 31, 2012         (8,044,700 )
                                                      
(-) New fundings                        -
(-) Accrued interests                   (163,884   )
(-) Currency exchange                   109,169
(+) Interest paid                       112,658
(+) Funding costs                       -
(-) Amortization of funding costs       (4,337     )
                                                      
Balance as of March 31, 2013            (7,991,094 )
                                                      

Conference Call:
 
Friday, May 10 at 1:00 P.M. (Brasília Time); 12:00 P.M. (EST)
Telephone (Brazil): +55 11 4688-6341
Telephone Toll-free (US): +1 855 281-6021
Telephone (US): +1 786 924-6977
Code: OGX
Webcast in Portuguese: www.ccall.com.br/ogx/1t13.htm

Webcast in English: www.ccall.com.br/ogx/1q13.htm
 
Audio will be available three hours after the conference call on the IR
website: www.ogx.com.br/ri

The conference call will be conducted in English with simultaneous translation
to Portuguese.
 

ABOUT OGX

OGX Petróleo e Gás SA is focused on oil and natural gas exploration and
production and is conducting the largest private-sector exploratory campaign
in Brazil. OGX has a diversified, high-potential portfolio, comprised of 26
exploratory blocks in the Campos, Santos, Espírito Santo, Pará-Maranhão and
Parnaíba Basins in Brazil, and 5 exploratory blocks in Colombia, in the Lower
Magdalena Valley and the Cesar-Ranchería basins. The total extension area is
of approximately 4,600 km² in sea and approximately 36,700 km² on land, with
24,500 km² in Brazil and 12,200 km² in Colombia. OGX relies upon an
experienced management team and has a solid cash position, with approximately
US$1.1 billion in cash (as of March 2013) to fund its E&P investments and new
opportunities. In June of 2008, the company went public, raising R$6.7
billion, which at the time was the largest amount ever raised in a Brazilian
IPO. OGX is part of the EBX Group, an industrial group founded and led by
Brazilian entrepreneur Eike F. Batista, who has a proven track record in
developing new ventures in the natural resources and infrastructure sectors.
For more information, please visit: www.ogx.com.br/ri

LEGAL NOTICE

This document contains Company-related statements and information that reflect
the current vision and/or expectations the Company and its management have
regarding its business plan. These include, among others, all forward-looking
statements that involve forecasts and projections, indicate or imply results,
performance or future achievements, and may contain words such as “believe,”
“foresee,” “expect,” “consider,” “is likely to result in” or other words or
expressions of similar meaning. Such statements are subject to a series of
expressive risks, uncertainty and premises. Please be advised that several
important factors can cause the actual results to diverge materially from the
plans, objectives, expectations, estimations, and intentions expressed in this
document. In no event shall the Company or the members of its board,
directors, assigns or employees be liable to any third party (including
investors) for investment decisions or acts or business carried out based on
the information and statements that appear in this presentation, or for
indirect damage, lost profit or related issues. The Company does not intend to
provide to potential shareholders with a revision of the statements or an
analysis of the differences between the statements and the actual results. You
are urged to carefully review OGX's offering circular, including the risk
factors included therein. This presentation does not purport to be
all-inclusive or to contain all the information that a prospective investor
may desire in evaluating OGX. Each investor must conduct and rely on its own
evaluation, including of the associated risks, in making an investment
decision.

Photos/Multimedia Gallery Available:
http://www.businesswire.com/multimedia/home/20130509006660/en/

Multimedia
Available:http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50629775&lang=en

Contact:

OGX Contacts
Investors:
Roberto Monteiro, roberto.monteiro@ogx.com.br
Eduardo Lucchesi, eduardo.lucchesi@ogx.com.br
Thomaz Freire, thomaz.freire@ogx.com.br
Gabriel Browne, gabriel.browne@ogx.com.br
+55 21 2163 6237
or
Media:
Daniele Rivera, daniele.rivera@ogx.com.br
+55 21 2163 7568
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