UPDATE 2-Brazil's OGX falls as January oil output misses mark

lunes 4 de febrero de 2013 19:08 CET
 

* OGX shares have plummeted 76 percent in past year
    * January production data fell short of expectations

 (Adds comments, updates share performance in paragraphs 2-6)
    By Guillermo Parra-Bernal and Danielle Assalve
    SAO PAULO, Feb 4 (Reuters) - Shares of OGX Petróleo e Gas
Participações SA, the Brazilian oil producer
controlled by billionaire Eike Batista, dropped for the third
day in four on Monday after output fell short of expectations in
January.
    The stock shed as much as 4 percent to 3.99 reais, the
lowest intraday price in three sessions. It recouped some of the
losses and was trading 2.1 percent lower by 3 p.m. local time
(1700 GMT.)
    The decline followed the release of average daily output
data for January that came in below recent monthly levels in
terms of average output per well.
    Analysts say lower-than-expected productivity readings for
OGX's newly inaugurated third well in the Campos Basin, coupled
with a slip in January output at two longer-established wells,
is fanning concerns about potential depletion rates.
    The Rio de Janeiro-based company produced 16,400 barrels of
oil equivalent per day (boepd) in January, with offshore
production up to 13,200 boepd after the third well in the
Tubarao Azul field in the Campos Basin began producing in early
January. Investors expected offshore output to reach as high as
17,000 boepd in January.
    "The lower productivity brings negative read-through that
OGX's depletion rates could be worse than expected, while
removing the perception of potential upside from higher peak
production rates," wrote Pedro Medeiros, an oil analyst with
Citigroup GB&M.
    The data was dismal based on the expectations that markets
had been building up regarding output, Lucas Brendler, an oil
analyst with Geração Futuro Corretora said.
    Despite average output per well falling, January's total
output was the highest OGX has achieved one year after it began
pumping oil. Production was boosted by its first onshore oil
output last month which added an average 3,200 boepd from the
Gaviao Real field over a 12-day period, as well as the new
output from the third Tubarao Azul well.
    Analysts say a slump in the stock reflects the lack of
clarity in the company's strategy that "has fueled risk
aversion" and raised questions over OGX's ability to deliver on
goals. Disappointing production trends and a deterioration of
the company's cash position could further pressure the stock,
Deutsche Bank Securities analyst Marcus Sequeira said on Friday.
    Monday's decline in shares comes as OGX in recent days
failed to find oil-bearing reservoirs in its Cozumel prospect in
the offshore Campos basin.

 (Additional reporting by Gustavo Bonato and Peter Murphy;
Editing by Grant McCool, Chizu Nomiyama and Sofina Mirza-Reid)