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QGEP uses leading industry tools to help manage its operational safety requirements, socio-environmental impacts and employee welfare commitments

QGEP Participações S.A. is part of the Queiroz Galvão Group. The company was formed in 2010 when the then Queiroz Galvão Óleo e Gás S.A. (QGOG) spun off its oil and gas exploration and production-related activities from drilling services (whereby OGOG retained its operations in providing platforms, supplying rigs and other services). As the controlling shareholder in Queiroz Galvão Exploração e Produção S.A., QGEP Participações S.A. was designed to focus on the exploration and production segment. In addition, QGEP took on the challenge of becoming the Group’s first publicly-traded company by listing its shares on the BM&FBovespa Novo Mercado, the segment of the Brazilian stock exchange reserved for companies with the highest standard of corporate governance, in February 2011.

QGEP owns the concession rights to nine Exploration Blocks in the Santos (SP), Campos (RJ), Jequitinhonha (BA) and Camamu-Almada (BA) Basins. Among Brazilian companies it was a pioneer in qualifying as an A operator, which allows it to carry out every type of exploration in Brazil, from onshore to ultra-deep water. QGEP has the largest production of any privately-controlled domestic company in its sector, based on annualized barrels of oil equivalent per day production figures from Brazil’s Agência Nacional de Petróleo, Gás Natural e Biocombustíveis (ANP).

The company has one producing asset, the Manati Field, which is located in the Camamu-Almada Basin, off the coast of Bahia. QGEP holds a majority (45%) stake in the project’s consortium, as well as a long-term contract with Petrobras (the Field’s operator) to purchase the natural gas produced. In 2012, the Manati Field was one of Brazil’s largest producing assets, with average daily production of 6.1 million cubic meters.

Revenue from the Manati Field provides the Company with robust, predictable cash flow, which allows QGEP to invest in exploration and development. In 2012, QGEP made progress in various strategies, particularly those related to the development of the Atlanta Field, where contracts for an Early Production System were awarded in 2012. A team of 91 professionals manages the company’s activities at QGEP headquarters in Rio de Janeiro (RJ) and its office in Salvador (BA).

One of the company’s most promising prospects is Carcará, located in Block BM-S-8 in the pre-salt exclusion area of the Santos Basin, though this asset is still in the exploratory phase.
In 2012, drilling at Carcará identified a 471-meter column of high quality oil. This project is expected to go into production later in this decade.

Since inception, QGEP has maintained highest standards in operational safety, environmental management, social responsibility and the health and well-being of its employees. To help manage these initiatives, it has adopted an Integrated Management System (IMS) which follows the principles behind the International Organization for Standardization (ISO) and ANP’s Technical Regulation for Operational Security Management Systems (SGSO).

Key indicators (in R$ millions, unless otherwise indicated)	2012	2011
Gross operating revenue	586.1	372.0
Net operating revenue	462.3	289.0
Operating income	40.0	36.9
Earnings per share (R$)	0.31	0.36
Shareholders’ equity	2,227.8	2,175.8
Investments in environmental protection1	1.6	9.5
Reserves (millions of barrels of oil equivalent)	56.8	70.2
Gas production (millions of m3)2	1,011	675

1. Lower in 2012, as there were no operations during the year.
2. Includes QGEP’s 45% equity stake in the Manati Field.

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