Brazilian energy firm OGX Petroleo e Gas Participacoes SA wants to persuade creditors to put up more money as it strives to avoid outright failure. The Wall Street Journal (WSJ) said OGX reported a loss of BRL2.1 billion (USD915 million) for the third quarter ended in September after its deal with Malaysia's Petronas fell apart. It ended the quarter with USD85 million in cash.
Strapped for cash, OGX filed for bankruptcy protection in late October with USD4 billion in debt. It is one of the largest Latin American corporate collapses to date, the report said.
According to WSJ, OGX is currently in talks with bondholders for additional cash to continue investments in the Tubarao Martelo oil field. The oil field is expected to start production in the coming weeks. Sources told WSJ that OGX advisers met with bondholders in New York on Monday and Tuesday and asked for at least USD150 million in fresh cash. The group included US companies Pacific Investment Management Co. (PIMCO) and BlackRock Inc.
On Wednesday, OGX said discussions with bondholders are advancing, but have yet come to a conclusion. The petroleum company is seeking to have the agreement signed in December and expects to receive new capital starting next month, WSJ said.
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