By Maria Lopez Conde, Senior Contributing Reporter

SÃO PAULO, BRAZIL – OGX, the oil exploration and production firm owned by former Brazilian billionaire Eike Batista, filed for bankruptcy protection before a Rio de Janeiro state court on October 30th. The move, considered Brazil’s biggest corporate default, came just one day after OGX failed to come to an agreement with creditors over its massive US$5.1 billion debt.

Batista's OGX Files for Bankrutpcy, Rio de Janeiro, Brazil News
The beleaguered Eike Batista now has about one percent of the US$34.5 billion fortune he had at the beginning of 2012, photo by Federaçao das Indústrias do Estado de São Paulo/Wikimedia Creative Commons License.

The embattled oil firm now has sixty days to come forward with a restructuring plan and creditors have about 180 days to approve or reject the plan. If creditors do not accept the proposed restructuring, the company could be liquidated.

OGX – once considered the jewel in the crown of Batista’s “X” empire – failed to pay its investors bond interest payments that were due in early October. The value of OGX shares have fallen by over 99 percent since their apogee in 2009.

Founded in 2007, OGX raised over US$1.3 billion from private investors to buy oil concessions and close to an additional US$4 billion in an initial public offering in Brazil’s stock exchange. Batista, a former speedboat racer with a flamboyant personality, had originally succeeded in pumping out vast amounts of oil from his fields but soon the company struggled with unproductive wells and rising production costs.

The OGX bankruptcy filing is only the latest episode in the saga of Batista’s downward spiral, which has seen the former billionaire lose over 95 percent of his fortune in just a year. Once the poster boy for Brazil’s commodity-driven boom, Batista, for many, has come to symbolize the unfulfilled promise of the country’s vast resources.

Read more (in Portuguese).

* The Rio Times Daily Updates feature is offered to help keep you up-to-date with important news as it happens.

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