OGX Expects Output at $270 Mln Block in 2014

OGX Petroleo e Gas Participacoes SA, Latin America’s third-largest oil producer by market value, expects output to start in late 2014 at a recently acquired offshore Brazilian block, the company’s press office said in an e-mailed statement.

OGX, which is controlled by its billionaire Chairman Eike Batista, acquired a 40 percent stake in the 1,500 meter deep block for $270 million from Petroleo Brasileiro SA last month. The block holds 2.1 billion barrels of oil equivalent of so-called in-place reserves at the Atlanta and Oliva oil fields, according to OGX data.

QGEP Participacoes SA, the operator of the block, has said it expects to drill the first well next year, start producing in late 2014 and reach full development between 2017 and 2018. QGEP owns 30 percent while Barra Energia Petroleo & Gas owns the remaining 30 percent.

OGX is planning to drill 11 wells in two basins next year and three more with partner Perenco SA in the Espirito Santo basin. The company also plans to seek new clients for its oil after closing a deal to deliver 800,000 barrels of crude to Chile’s state-controlled Empresa Nacional de Petroleo in January as it seeks to diversify its customers. OGX this year sold oil shipments to Royal Dutch Shell Plc and Reliance Industries Ltd.

(Company corrects estimated time for start of oil output in first paragraph.)
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