Shares of OGX, an oil and gas company that is part of Brazilian magnate Eike Batista's business empire, had plunged 34 percent by mid-session Monday on the Sao Paulo Stock Exchange after the company said it would halt operations at an offshore field.
OGX announced the suspension of operations at Tiburao Azul in a regulatory filing, saying it encountered geological difficulties that made investment in the field unviable.
It also said it would evaluate its operations at three neighboring fields that may have similar problems.
"At this time, there doesn't exist any type of technology available to make investments in this field financially viable," which would be necessary to "raise the production profile" of those fields, the firm said.
Batista's sprawling corporate empire is currently beset by serious financial challenges.
Folha de Sao Paulo newspaper reported Sunday that his EBX Group conglomerate, to which OGX belongs, was urgently trying to restructure debt contracted with 11 banks. Loans totaling 7.9 billion reais ($3.6 billion) will come due in March 2014.
Efforts to renegotiate that debt have coincided with the announcement of a major restructuring at EBX.
Financial market spokespersons say that as part of that restructuring Batista, who until 2011 had been listed by Forbes magazine as the world's seventh-wealthiest person, will need to sell off many of his assets.
Since then, according to Forbes, his net worth has fallen from $19.4 billion to some $10.6 billion. EFE