OREANDA-NEWS. July 02, 2012. OGX, the Brazilian oil and gas company responsible for the largest private-sector exploratory campaign in Brazil, announced that after almost five months of Extended Well Test (EWT) operations in the Tubarao Azul Field (previous the Waimea Accumulation), the Company has defined an ideal flow rate of 5,000 barrels of oil equivalent per day per well for the first two wells, not including the impact of any water injection operations. The Tubarao Azul Development Plan was filed on June 1, 2012 with Brazil’s National Petroleum, Natural Gas and Biofuels Agency (ANP).

Since the beginning of the EWT, wells OGX-26 and OGX-68 were tested with flow rates ranging between 4,000-18,000 barrels per day, yielding a better understanding of the reservoir model and indicating the necessity of replacing the centrifugal submersible pump in OGX-26 with another pump with different features in order to adjust the pumping capacity of the well beyond the ideal flow rate.

During the last five days, given the stop in production from well OGX-26 to allow for the replacement of the pump, production unit FPSO OSX-1 has been producing 7,400 barrels of oil equivalent per day from OGX-68 and is showing satisfactory levels of pressure in the reservoir.

Within the next 12 months, two producing wells and two injection wells will be connected to FPSO OSX-1, allowing for a steady increase in oil production at the Tubarao Azul Field. In addition to water injection, the Company plans to use technologies such as chemical hydraulic fracturing and other well-known industry techniques in order to optimize production.

OGX remains confident it will recover 110 million barrels of oil equivalent at the Tubarao Azul Field, especially because, throughout the EWT, the Company identified natural fractures in the reservoir connecting OGX-26 and OGX-68.

“All these decisions have been taken to ensure sustainable exploitation at the Tubarao Azul Field and in accordance with industry best practices," commented Paulo Mendonca, OGX’s CEO.

The Company also announced that production units (FPSOs) OSX-2 and OSX-3 are at an advanced stage of construction in Singapore and are scheduled to arrive in Brazil and begin production in the second half of 2013.