OGX sells 50% stake in new Brazilian oil, gas blocks to MPX

5/16/2013

OGX sells 50% stake in new Brazilian oil, gas blocks to MPX

BY JEFF FICK

RIO DE JANEIRO -- OGX Petroleo e Gas Participacoes SA (OGXP3.BR, OGXPY) sold a 50% stake in four oil and natural gas exploration blocks acquired at an auction earlier this week to sister company MPX Energia.

MPX will pay OGX roughly $5 million, or half of the signing bonuses OGX offered as part of the firm's winning bid at Wednesday's concession auction, the companies said. In addition, MPX will also assume half of the exploration commitments for the blocks.

The four blocks are located in the Parnaiba Basin of Brazil's northeast state of Parnaiba. OGX and MPX previously formed a joint venture firm, OGX Maranhao, which developed a natural-gas-fired power plant alongside a series of fields that started production earlier this year. The power plants will boost Brazil's electric generation capacity, and help offset low reservoirs in Brazil's hydroelectric system, which has caused concerns about possible energy rationing.

OGX and MPX are both part of billionaire Brazilian businessman Eike Batista's industrial empire, which spans such diverse interests as oil, mining, shipbuilding and real estate.

Dow Jones Newswires

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