OGX Petroleo e Gas Participacoes SA, the oil company controlled by Brazilian billionaire Eike Batista, fell the most in three weeks after reserve estimates at its first development fell short of investors’ expectations.
OGX, based in Rio de Janeiro, tumbled 2.3 percent at 11:20 a.m. in Sao Paulo. Earlier it slid as much as 4.7 percent, the biggest intraday drop since April 23.
At Tubarao Azul, where OGX boosted output to 23,500 barrels a day yesterday after adding a new well, the company calculates total recoverable reserves of 110 million barrels over the project’s lifetime. This figure will probably increase to 150 million barrels as the company improves technology and extracts additional crude, Chief Executive Officer Paulo Mendonca said on a conference call with investors.
“The 110 million is smaller than we expected,” Auro Rozenbaum, an analyst at Banco Bradesco SA in Sao Paulo, said in a telephone interview.
OGX’s target to produce as much as 40,000 barrels a day of oil at Tubarao this year is also lower than previous company estimates, Rozenbaum said.
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