OGX Petróleo e Gás Participações S.A., in compliance with the Instruction of Comissão de Valores Mobiliários (CVM) n.° 358 as of January 3, 2002, as amended, hereby announced to its shareholders and the general public the pricing of Senior Unsecured Notes ("Notes") totaling $1.063 billion. The Notes will be due on April 1, 2022 and will accrue interest at rate of 8.375% per annum, payable semi-annually, on April and October. The Notes have not been registered under the United States Securities Act of 1933, as amended, or the Securities Act, or under any U.S. state securities laws. The Notes will be offered to qualified institutional buyers (QIBs) in the United States in accordance with Rule 144A of the Securities Act and in other countries except the United States and Brazil in compliance with Regulation S of the Securities Act. When added to OGX's current cash position as of December 31, 2011 and R$ 600 million financing obtained by OGX Maranhão, the net proceeds from the issuance of the Notes provide a liquidity of approximately $4.4 billion, which is sufficient for OGX to support its business plan investments until the Company becomes free cash flow positive.
This funding provides the necessary capital for OGX's investment program, including subsea completion of all producing wells until the end of 2013, incremental exploration capex in the blocks BM-C-37 and BM-C-38, where OGX recently increased its participation and became operator and appraisal of the Santos Basin shallow water pre-salt discovery, while also maintaining a cash position which financially structures the Company for potential new ventures and bidding rounds.
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