OGX Announces Business Plan for Campos and Parnaiba Discoveries
OREANDA-NEWS. June 21, 2011. OGX Petroleo e Gas, the Brazilian oil and gas company responsible for the largest private-sector exploratory campaign in
"Following OGX’s discoveries and successful appraisal campaign in the
In order to fund its exploration and production activities, OGX raised approximately USD 8 billion, including USD 1.3 billion through an equity private placement in 2007, an additional USD 4.1 billion in the 2008 initial public offering (IPO), and a further USD 2.563 billion through the senior unsecured notes offering announced on May 26, 2011.
Since its IPO, OGX has made the following important achievements in executing its business plan:
- A significant increase in its portfolio’s potential resources from 4.8 to 10.8 billion boe;
- The drilling of 52 wells in the past 20 months with an overall success rate exceeding 90%;
- An increase in the number of concessions from 21 to 34, of which 29 are located in
five in
- The expansion of the Company’s concession acreage from approximately
km?; and
- A growth in the current number of employees to more than 250, while leveraging a total
workforce of over 6,100 professionals.
As a result of the Company’s financial discipline, OGX has maintained strong liquidity throughout all of its exploratory activities, with cash and cash equivalents of USD 2.5 billion as of March 31, 2011. OGX expects that this level of liquidity, plus the USD 2.563 billion of proceeds from the debt offering and its operating cash flows from production, will enable the Company to fully fund its production development of the discoveries already made and to reach stable positive free cash flows in 2014.
OGX’s successful exploratory campaign has been followed by an intensive appraisal campaign in order to gather more information on the accumulations discovered and optimize the execution of the development plans, which were based on 4.2 billion boe already discovered in the
In the Campos Basin, production will begin in the first project (Waimea complex) in October 2011, with anticipated production of up to 20,000 barrels per day (bpd) from the OGX?26 well. The second project (
The Company will adopt the best practices in the oil and gas industry in its production in order to avoid reservoir damage. OGX expects to achieve 150,000 bpd of production from the
In addition to these three FPSOs, OSX has acquired two very large crude oil carriers (VLCCs), which will be converted into two FPSOs (OSX?4 and OSX?5). These equipment will be leased to OGX, with delivery expected in 2014. It is anticipated that both of these FPSOs will have approximately 1.3 million barrels of storage capacity and approximately 100,000 bpd of installed oil processing capacity.
The gas production ramp-up in the
The Company anticipates that the Campos and
"We are excited to begin our production this year in the
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