OGX announces major natural gas discovery in Brazil

13:54, August 13, 2010      

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Brazilian oil company OGX announced on Thursday a major natural gas discovery in the northeastern state of Maranhao, which an industry insider says can potentially double the country's natural gas reserves.

Eike Batista, OGX's chairman and controlling shareholder, estimated the natural gas reserves, found in a well in the onshore Parnaiba basin in Maranhao, could reach 10 to 15 trillion cubic feet (283 to 425 billion cubic meters).

Statistics of the National Petroleum Agency showed Brazil had 364.9 billion cubic meters (12.9 trillion cubic feet) of proven natural gas reserves at the end of 2007, with the majority in the Campos and Santos Basins.

The new discovery is also equal to almost half of the entire reserves of Bolivia. Bolivia's natural gas reserves stood at 19 trillion cubic feet (538 billion cubic feet), its energy minister said earlier this month.

Natural gas constitutes only a small portion of Brazil's total energy consumption. Bolivia is one of the main exporters of natural gas to Brazil.

OGX said the gas was found at a depth of 1,654 meters only about ten months after Brazilian companies started exploration works.

The drilling of the well will continue until it reaches a depth of 3,450 meters, the company said.

The discovery opens a new exploratory frontier on an onshore basin, says Paulo Mendonca, general executive officer of the company.

OGX said the well is located in a block owned by OGX Maranhao and Petra Energia. OGX Maranhao, a joint venture between OGX and MPX Energia, has a 70-percent stake in the business and is the operator. Petra Energia holds the remaining 30-percent interest.



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