OGX Petroleo e Gas Participacoes SA, a Brazilian oil explorer controlled by billionaire Eike Batista, is to invest around $3 billion in exploration through 2013. The firm announced Wednesday its massive investment undertakings, geared at turning the independent driller into a major oil industry player in Latin America’s biggest economy.

In its exploration strategy, OGX is to drill 87 wells by 2013, but as it stands currently, only 35 wells have been drilled. However, OGX said it is expecting to maintain at least $1 billion per annum in investments. The aim is to enhance OGX’s offering and global position to the likes of Petrobras, Total amongst other major oil producers. The firm expects to drill its first supply of crude oil sometime in August, at its Waimea prospect.

Earlier Wednesday, OGX announced completion of the first production well at Waimea. The well showed production capacity of about 40,000 barrels a day, although initial operation would likely cap output at 20,000 barrels. An extended well test at Waimea is expected to start soon. Initial flow tests at the well were beyond initial expectations, Batista said.

The company has already contracted all of the equipment to produce at Waimea, including the OSX-1 floating production, storage and offloading vessel, or FPSO, that will be installed at the field. The start of oil production will also boost the value of OGX's other Campos Basin assets, Batista said. Last year, OGX said that it planned to sell a stake of as much as 30% in its Campos Basin discoveries. The stake sale, however, hasn't yet come to fruition.

OGX Petroleo e Gas Participacoes S.A. engages in the exploration and production of oil and gas properties in Brazil. It has a portfolio of 29 exploratory blocks in the Campos, Santos, Espírito Santo, Pará-Maranhão, and Parnaíba basins, which encompass an offshore area of approximately 7,000 square kilometers (km) and onshore area of approximately 21,500 square kms.

The company was formerly known as Centennial Asset Participacoes Corumba S.A. and changed its name to OGX Petroleo e Gas Participacoes S.A. in September 2007. OGX Petroleo e Gas Participacoes S.A. was incorporated in 2006 and is headquartered in Flamengo, Brazil.

Just recently, OGX announced the accomplishment of an important step necessary for initial production. The company concluded the drilling of the horizontal well, Waimea Horizontal, and through a drill-stem test (DST), has identified an excellent production index (PI).

14 Feb 2011.