BRASILIA, July 10 OGX Petroleo e Gas SA
said on Wednesday that two members of its board were
leaving, as the troubled flagship of Brazilian billionaire Eike
Batista's EBX group has failed to deliver on promised oil
Samir Zraick and Luiz do Amaral de França Pereira will no
longer be members of its board of directors, OGX said in a
statement, adding that the company will name new board members
soon to comply with regulations for minimum board membership.
A more than 90 percent decline in the value of OGX stock in
the last year has cost the company its place as the No. 2
Brazilian oil company by market value.
The Rio de Janeiro-based company is expected to shrink as
part of the restructuring of Batista's embattled group of
energy, mining, shipbuilding and port companies.
OGX's failure to generate revenue from its oilfields and
doubts about Batista's pledge to invest $1 billion more in the
company have led investors to worry that it will not have enough
money to finance needed new production and pay existing debt.
The company's bonds (OGX) are trading at levels that suggest
a debt-default is highly likely. Fitch Rating Service downgraded
OGX debt to "CCC" on June 14.
A week after the downgrade, three high-profile OGX board
members quit. The three rank among Brazil's most respected
financial, political and legal leaders: Pedro Malan, a former
long-serving Brazilian finance minister; Rodolfo Tourinho, a
former energy minister; and Ellen Gracie, a former chief justice
of Brazil's Supreme Court.
The six-year-old company is struggling to turn promising
offshore discoveries into producing fields. Output from OGX's
first offshore field, Tubarão Azul, began in early 2012 at far
below expectations. That raised concern OGX would be unable to
generate revenue to finance ships and drill new wells.