Brazil oil regulators approve OGX as deepwater operator

10/25/2012

Brazil oil regulators approve OGX as deepwater operator

BY JEFF FICK

RIO DE JANEIRO -- Brazilian independent oil producer OGX said that local regulators had approved the company as a deepwater operator, opening the door for OGX to bid for more challenging exploration acreage in upcoming bid rounds.

ANP, granted OGX an Operator A qualification, which company officials had previously said they expected before the end of 2012. Previously, OGX's Operator B qualification limited the company to operating shallow water and onshore blocks.

The new qualification will allow OGX to operate in the deep and ultra-deep waters where some of Brazil's most promising oil discoveries have been made in recent years. Some deepwater blocks in Brazil's equatorial margin are expected to be up for bid in Brazil's 11th round concession auction that is currently set for May. The auction still depends on lawmakers passing a new law on oil royalties, although voting is expected to take place this year.

OGX currently operates shallow water blocks in the Campos and Santos basins. But the company also holds a 50% stake in five deepwater blocks in the Espirito Santos Basin. Operatorship of those blocks is under the control of the local unit of the French oil and natural gas company Perenco, which has a 40% stake in the blocks. China's Sinochem also recently completed its purchase of a 10% stake in the blocks.

Dow Jones Newswires

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