RESULTS FOR THE SECOND QUARTER OF 2016

Transcription

1 RESULTS FOR THE SECOND QUARTER OF 2016 Rio de Janeiro, August 12 th, 2016 Óleo e Gás Participações S.A. under Judicial Reorganization (Bovespa: OGXP3; OTC: OGXPY.PK) ( OGpar or Company ) announces today its results for the second quarter of 2016, and subsequent relevant events to the market. Management Message In the second quarter, OGpar and OGX P&G made substantial progress in the negotiation with OSX-3 Leasing B.V. creditors, and signed an agreement ( Partial Agreement ) on July 15 th, 2016, suspending the litigation between the parties for a period of 30 business days as of the date of approval by the competent Court. The Partial Agreement guarantees the continuity of the Company s activities and creates an opportunity for the execution of a definitive agreement in order to reduce operating costs and end all existing disputes between the parties. In the same period, OGpar has successfully concluded the reverse stock split of its issued shares in order to comply with the Issuer Regulation, Admission to the Securities and Exchange Negotiations and BMF&Bovespa Issuer Manual. The inplit was approved in the ratio of 100 shares for 1 share after it was proposed by minority shareholders during the Extraordinary Shareholder s Meeting on April 29 th, Given the recovery in oil prices in international markets on the last few months, production was resumed in the Tubarão Martelo Field on July, averaging 9.8 thousand barrels of oil per day, allowing the return of cash generation and new growth prospects. Also during the second quarter of 2016, OGX P&G, OGpar subsidiary, received the payment related to PIS and COFINS tax credits, in the amount of R$ million, which contributed to reduce the pressure on its cash position and comply with short-term obligations until the resume and stabilization of production at the Tubarão Martelo Field. 1

2 Assets under Development Atlanta and Oliva Fields ( BS-4 ) Atlanta is a post-salt field located in BS-4 Block, in the Santos Basin. OGX P&G, OGpar subsidiary, has a 40% interest in the consortium, in partnership with Barra Energia do Brasil Petróleo e Gás Ltda., with a 30% interest, and Queiroz Galvão Exploração e Produção S.A. ( QGEP ), the block s operator, also with a 30% interest. On August 10 th, 2016, the field s operator disclosed to the market that, due to challenges found in the process of customizing the FPSO Petrojarl I, the vessel expectancy to arrive was postponed to the first quarter of In this sense, the first oil of the Early Production System ( SPA ) in the Atlanta Field which was scheduled for the last quarter of 2016, should only occur on the first semester of In this first phase, potential production is estimated at 20,000 bbl/d, with two producing wells that were already drilled and equipped with submersible pumps and wet Christmas trees. The projection has a margin variation of +/-10%. Production in the SPA may reach around 30,000 bbl/d with three producing wells, however, the operator will disclose the production curve in Atlanta Field once the third well drilling schedule is defined. FPSO Petrojarl I will be chartered for five years, with a termination clause valid after the third year, and the consortium has also contracted the necessary equipment and underwater solutions. OGX Austria GmbH, a wholly owned subsidiary of OGX P&G, signed an agreement for the sale of oil (COSA - Crude Oil Sales Agreement) corresponding to OGX s share of production for the Atlanta Field SPA. The agreement has a term of three years and may be extended for another year. The sale of oil to Shell Western Supply and Trading Ltd. ( Shell ) will be Free on Board ( FOB ) in the FPSO with a netback pricing mechanism. The estimated CAPEX of the consortium is US$ 100 million for 2016 and US$ 150 million for 2017, and OGX P&G is responsible for 40% of the estimated CAPEX. The total estimated operating cost for the charter and maintenance serves for the SPA is US$ 480 thousand per day, including leasing, services, logistics, insurance and abandonment fund costs, among others. 2

3 Assets in the Campos Basin Tubarão Azul Field In January 2016, OGX concluded the decommissioning of FPSO OSX-1 platform, fulfilling all of the commitments with OSX 1 Leasing B.V., its respective creditors and OSX Serviços Operacionais Ltda. under Judicial Reorganization. The success of the decommissioning is a result from OGX s capacity to negotiate with its creditors and regulatory agents. As part of the agreement, OSX-1 Leasing B.V. deposited US$32 million in an escrow account with the sole purpose of guaranteeing the fulfillment of the obligations associated with the abandonment of the Tubarão Azul Field wells. The amount deposited by OSX-1 Leasing B.V. was contributed on OGX P&G through the capital increase approved at the Board of Directors Meeting of June 3 rd, 2016 and the private issuance of new shares. Tubarão Martelo Field A - Production On March 5 th, 2016, the Company temporarily suspended production in the Tubarão Martelo Field, due to the persistent fall in oil prices in the international market, which made the operation on the field economically unfeasible at the time. However, due to the recovery in oil prices in the international market, OGX P&G reviewed its decision and, on April 26 th, 2016, filed with ANP a request to resume production in the four wells connected on the Tubarão Martelo Field, aiming to generate cash in a more favorable market scenario. After receiving approval by ANP, on July 1 st, 2016, production was resumed on the field. The activities in the four wells are stable and operating normally. The chart below shows the evolution in Brent oil prices in the first six months of

4 Brent Oil Prices (US$) Exploratory Assets Equatorial Margin ExxonMobil Exploração Brasil Ltda. requested the return of the POT-M-762 block, which is under review by the ANP. As for the PAMA-M-591 and PAMA-M-624 blocks, on June 15, 2016, OGX P&G was notified by the ANP of the waiver from Minimum Exploratory Program compliance, due to the absence of the environmental permit. OGX P&G, OGpar subsidiary, is also awaiting review and final approval by the ANP regarding the sale of its stake in CE-M-603 and POT-M-475 blocks, operated by ExxonMobil Exploração Brasil Ltda., signed in a farm out agreement in September OGX will keep its shareholders and the market informed about the developments of this matter. 4

5 Assets Available for Sale Parnaíba Gás Natural On March 24 th, 2016, the Company, together with OGX, signed an agreement with Eneva S.A. ( Eneva ), pledging to subscribe part of the new common shares to be issued under Eneva s private capital increase, by means of the contribution of all of its interest held in PGN at the time of subscription. Cambuhy also signed an agreement with Eneva, whereby it would contribute all of its interest in PGN and PGN's third and fourth issuance of convertible debentures. As a result of the implementation of the aforementioned capital increase, Eneva may hold 100% of PGN s capital stock and OGX will hold an interest on Eneva. Additionally, as part of the agreement, OGX signed an agreement with Cambuhy, to sell the 5% interest it holds in PGN s capital stock for R$10 million, which is also subject to suspensive conditions, including the authorization of the Judicial Reorganization court. Royalties Rights Abroad In April 2016, OGX P&G sold its rights to royalties of 3% of the revenue generated from the sale of hydrocarbons in the VIM-5 and VIM-19 blocks for approximately R$10.4 million, allowing the generation of cash in the short term and concluding the sale of all assets located in Colombia, pursuant to OGX P&G Judicial Reorganization Plan. Personnel The Company ended the second quarter of 2016 with 211 employees on its payroll and 168 outsourced workers, a reduction of approximately 16% in the number of employees and outsourced workers compared to the previous quarter and a decline of 38% over December 31, The reduction in the number of outsourced workers continued in the second quarter of 2016, due to the decommissioning of the FPSO OSX-1 platform and the temporary suspension of production in the Tubarão Martelo Field. 5

6 Financial Performance The financial and operating data shown below are presented on a consolidated basis, in accordance with International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board IASB and in Reais (R$), except where otherwise indicated. Income Statement R$ ( 000) PROFIT & LOSS ($) Q2/16 Q1/15 ($) G&A (2,150) (306) (1,844) (906) 2,684 (3,590) Operational EBITDA (2,150) (306) (1,844) (906) 2,684 (3,590) Gain on change of interest 18,228-18, Realization of accumulated translation adjustments (14,031) - (14,031) Realization of negative goodwill - 3,628 (3,628) Equity results 15,973 (91,358) 107,331 32,960 (71,807) 104,767 EBIT 18,020 (88,036) 106,056 32,054 (69,123) 101,177 Net financial results 6,793 (8,642) 15,435 3,442 1,584 1,858 EBT 24,813 (96,678) 121,491 35,496 (67,539) 103,035 (+/-) Income tax and social contribution Valuation allowance Net income (loss) - Total 24,813 (96,678) 121,491 35,496 (67,539) 103,035 a) Equity in the earnings of subsidiaries R$ Result of OGX P&G on June 30 th, ,015 - Percentage of OGPar s stake in OGX P&G 25,89% Equity in the earnings of OGX P&G: 16,056 Equity in the earnings of other subsidiaries: (83) Total 15,973 c) Financial Result: The Company registered a net revenue of R$ 6,8 million on the 2Q16, of which approximately R$ 9,3 million are from the impact of the unrealized exchange variation on loans. 6

7 OGpar Contacts Investors: Márcia Mainenti Victor Rosenzvaig Media: Cibele Flores DISCLAIMER This document contains statements and information about the Company that reflect the current views and/or expectations of the Company and its management with regard to its business plan. These include all statements containing forecasts and projections that indicate or imply future results, performance or achievements, which may include such words as "believe," predict, expect, contemplate, will probably result, or any other words or expressions of a similar meaning. Such forward-looking statements are subject to a series of risks, uncertainties and assumptions. Readers are advised that several important factors may lead actual results to significantly diverge from the plans, targets, expectations, estimates and intentions expressed herein. Under no circumstances shall the Company or its directors, officers, representatives or employees be liable to any third parties (including investors) should they make decisions or investments or carry out business acts based on the information and statements presented herein, nor shall the Company be liable for any indirect damages, loss of profit, or similar consequences thereof. The Company does not intend to provide shareholders with any revised versions of the statements or analysis of the differences between these statements and actual results. This presentation does not contain all the necessary information for a complete investment assessment on the Company. Investors should carry out their own assessments, including of the associated risks, before making an investment decision. 7