2013 was a strategic year as QGEP consolidated its bases for growth. All of the efforts that we have made in recent years to prepare, study, and research have contributed to making this year the year when QGEP consolidated its position as an operator and expanded its presence in the market. For some time, we have been preparing for the 11th Round of Bidding offered by the National Agency of Oil, Natural Gas and Biofuels (Agência Nacional do Petróleo, Gás Natural e Biocombustíveis – ANP), diligently applying the planning done up to this moment.
As a result, we have achieved two highly significant victories: diversification of partners and an expanded presence along the Brazilian coastline. We have also gained a balanced portfolio, with low risk assets (Campos and Santos), moderate risk (Camamu-Almada and Jequitinhonha), high potential (pre-salt areas of the Santos Basin), and high risk and high premium (new frontiers acquired in the bidding process).
As a result of this Round, we have five new partners, three of which are oil and gas majors and two of which are regional independent companies. This lowers the risk to our business, contributes to an exchange of knowledge, and strengthens the Company in the industry. Likewise, the fact that we are now present in frontier regions, such as Brazilian Equatorial Margin and within an area of the Espírito Santo Basin that has yet to be widely explored, also diversifies our operations and reduces the level of uncertainty that is characteristic of the E&P industry. At the same time, this diversification poses challenges for us to adapt our operations to social, cultural, environmental and economic conditions specific to each region.
As well as taking advantage of a very important moment to grow our business, we are also improving management of the assets that we already hold. Conclusion of drilling of the first horizontal well in the pos-salt layer in Atlanta, in the Santos Basin, went according to schedule and we continue to work to produce the well’s first oil in late 2015 or early 2016. In the BM-S-8 Block, we are preparing to drill the Carcará discovery extension well, one of the largest oil columns ever discovered in the pre-salt layer, at a depth of over 470 meters. All of these developments add experience and value to QGEP, as the Company makes operational advances and the staff gain yet more experience. Efforts to prepare for ANP bidding and to efficiently and safely manage assets have required larger teams, with new professionals and investments in top employee qualifications.
Internally, the Board of Directors is committed to overseeing the business and advising the Executive Board. One of the main advancements in the year was the drafting of QGEP’s strategic plan, which formalized our goals and outlined the trajectory to achieve them, involving professionals from every area. I am confident that this goal for the Company and the approach we should take to achieve it will help us create value not only for the Company, but for all of its stakeholders.
Antônio Augusto de Queiroz Galvão
Chairman of the QGEP Board of Directors
