“Production is progressing well and is on schedule in the Campos Basin, and a third production well in the Tubarão Azul Field will be connected in the coming weeks. In exploration, we began drilling new prospects in the Campos Basin where we continue to have strong expectations for our activities. In addition, we are continuing to develop the Tubarão Martelo Field, in the Campos Basin, and the Gavião Real Field project in the Parnaíba Basin where we expect to begin commercial gas production in early 2013. We expect to invest about US$1.2 billion towards capital expenditures in 2013 to continue delivering on our potential in both exploration and production,” Carneiro continued.

KEY HIGHLIGHTS

Production:

OGX’s production activities are progressing according to schedule.
  • Attained total production volume of 856,800 boe in 3Q12 in the Tubarão Azul Field (Campos Basin)
  • Drilled three production wells in the Tubarão Martelo Field (Campos Basin), projected to come on-stream late 2013 after the arrival of FPSO OSX-3
  • Third production well in the Tubarão Azul Field, TBAZ-1HP, under completion and to be connected to the FPSO OSX-1 in the coming weeks
  • Final stage of reservoir engineering for FPSO OSX-2 installation, with delivery scheduled for 2H13
  • All the production wells in the Gavião Real Field, in the Parnaíba Basin, have been drilled and are in the process of completion and connection to the Gas Treatment Unit (GTU). Commercial production is scheduled to begin in early 2013
  • Sale of approximately 800,000 barrels of oil, in October, to Reliance Industries Ltd.

Exploration:

OGX continued its successful exploratory campaign in the third quarter.
  • Receipt of environmental authorization from the Brazilian Environmental and Natural Renewable Resources Institute (IBAMA) to drill in the BM-C-37 and BM-C-38 blocks in the Campos Basin
  • New important discoveries of hydrocarbons in the Bom Jesus accumulation in the Parnaíba Basin
  • Submitted the winning bid for a block in the Lower Magdalena Valley Basin upon participating in Colombia’s 2012 National Agency of Hydrocarbonates (ANH)
  • Obtained Operator A qualification from Brazil's National Petroleum Agency (ANP), allowing OGX to operate blocks in deep waters and ultra-deep waters, in addition to shallow waters and onshore

Other:
  • In October, Eike Batista, controlling shareholder of OGX, granted the Company an option to require him to purchase up to US$1.0 billion of new common shares of OGX at a price of R$6.30 per share, conditional upon the Company’s additional capital requirement and the absence of more favorable alternatives

2013 OUTLOOK

Besides the increased focus on its production campaign, OGX has interesting prospects to be drilled in the coming months.