Monday, June 28, 2010

Brazil OGX Finds Oil In Campos Basin BM-C-40 Block

RIO DE JANEIRO (Dow Jones)--Brazilian oil and gas company OGX Petroleo e Gas Participacoes SA (OGXP3.BR, OGXPY) said a well in the Campos Basin's BM-C-40 block showed signs of oil.

The company said it had identified an oil-bearing interval in the 1-OGX-14-RJS well in the BM-C-40 block. OGX discovered an oil column of 60 meters in the Albian section, with net pay, or reservoir thickness, of 22 meters, OGX said. OGX holds a 100% stake in the block.

The well was drilled in 104 meters of water some 96 kilometers off the coast of Rio de Janeiro state. Initial drilling on the well was started on May 30 by Diamond Offshore Drilling Inc.'s (DO) Ocean Lexington rig.

"This discovery represents another very important step for OGX since hydrocarbons were detected also in an area to the north of our recent discoveries in Campos in which the company had not drilled previously," OGX CEO Paulo Mendonca said in a statement.

OGX holds stakes in 29 exploration blocks in the Campos, Espirito Santo, Para-Maranhao, Parnaiba and Santos basins.

Initial drilling success prompted the company to ramp up its exploration program. Over the next four years, OGX plans to drill 79 wells--72 offshore and seven on land.

In 2010, OGX will drill 27 wells. Twenty-six of the wells will be drilled offshore, with a single onshore well planned for the Parnaiba Basin.

Last week, OGX also purchased stakes in five exploration blocks in Colombia.

-By Jeff Fick, Dow Jones Newswires; 55-21-2586-6085;

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