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UPDATE 1-Brazil's OGX says restarts offshore well interrupted in June
August 7, 2012 / 12:35 AM / 5 years ago

UPDATE 1-Brazil's OGX says restarts offshore well interrupted in June

* OGX well in Tubarao Azul was restarted over weekend

* Company output plunged in July after well suspended

* OGX stock rises 7 percent, trading near 1-month high (Adds additional field and well output data, background of OGX shares, production problems.)

RIO DE JANEIRO, Aug 6 (Reuters) - OGX Petroleo e Gas SA , Brazil’s No. 2 oil company by market value, restarted output over the weekend at an offshore well northeast of Rio de Janeiro where production was suspended in June, a company spokesman told Reuters Monday.

The well, known as OGX-26, is part of the Tubarao Azul Field where OGX produced its first-ever oil in February.

Problems with a sub-sea pump at the well helped cut output from Tubarao Azul by nearly a quarter in July to 7,000 barrels a day from 9,200 barrels a day in June, OGX said in a securities filing on Monday.

Lower than expected output from the field has helped undermine confidence that the Rio de Janeiro-based oil start-up will achieve its production of 1.4 million barrels of oil and gas by 2020, as promised by controlling shareholder, Brazilian billionaire Eike Batista.

The stock has plunged about 40 percent since mid-June, but rose 7 percent on Monday to 6.15 reais in Sao Paulo, its highest close in nearly a month.

In the wake of the share plunge, Chief Executive Paulo Mendonca, one of Brazil’s most respected petroleum geologists, resigned. (Reporting by Sabrina Lorenzi and Jeb Blount; Editing by Carol Bishopric and Richard Pullin)

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