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Eike | Constructing The X Man


Source: Brasil 24/7

The X Group of industrial mogul Eike Batista continues to deteriorate. Most recently, the announcement of a possible suspension of drilling at the only operating platform at OGX prompted a 30% decline in share price.

It is a story of stratospheric expectations fed by an enormous PR campaign in the mode of “autohagiography by proxy” — grotesque myth-making that blurs the divide between journalism and publicity.

Brasil 24/7 points to one such case, and I translate.

In recent years, the principal boosters of business titan Eike Batista have been journalists Lauro Jardim of Veja’s Radar Online column and Ancelmo Gois of O Globo.” Batista also received a cover story and editorial in Veja.

Recently, Miriam Leitão of Globo has stated the obvious: the billionaire, said to have a natural gift for business and lionized by various media outlets, lied to investors and could cause incalculable damage to the image of Brazil.

Pump and Dump

247 – A bubble like the collapse of the X group is not constructed without a mininum of collaboration from the press. This was the case with the companies of billionaire Eike Batista, who in a single year managed to burn through R$ 100 billion of investor assets.

Like a good salesman, Eike told his investors he had a “pact with nature.” His style, frequently boastful, was hailed by the Brazilian press as the symbol of a new capitalism. Veja, for example, dedicated a front page to an article titled “Eike Xiaoping Batista,” subtitled “Getting Rich is Glorious” and featuring an editorial from publisher  Eurípedes Alcântara. “The reporting in this edition of Veja captures that special moment of glorifying wealth produced with hard work, honesty, personal investment and the courage to assume risks.” Eike is the symbol of a more generous era for all Brazilians,” Alcântara wrote.

We now know, however,  that Eike lied to his investors, as Miriam Leitão says. Since yesterday, when Eike issued a Material Event to the market, shareholders who bought shares now know that the “pact with nature” did not exist and that Eike lacks the technology to extract his supposed petroleum assets.

He could not, however, have gotten so far with his lies without the collaboration of the press. Two journalists in particular were Eike’s principal “promoters” in recent years: Lauro Jardim, of Veja magazine, andAncelmo Gois, of O Globo, …

Below, a note by Jardim in January 2012:

Eike and Dilma

Eike Batista’s OGX, has just told the CVM that it has discovered oil in the Santos Basin.  Although not stated in the material event, there are 2 billion barrels inreserves.

This volume should make a lot of noise in the oil industry.  As a point of comparison, the estimated reserves of the pre-salt are 5 billion barrels.

The difference is that the oil discovered by Eike’s wells are in shallow water, in both pre-salt and post-salt areas.  The cost of production, therefore, should be less than if the reserves were to be found in deep water.

The discovery was made 102 km from the coast. It is located 80 km from Paraty, as the crow flies …

There is a coincidence destined to enrich the folklore of Brazil’s richest man.  According to a report delivered yesterday to President Dilma Rousseff, when he told her about the discovery, Eike said the discovery was made during the 63rd attempt — 63 is the lucky number of the superstitious tycoon.

During the conversation Eike compared Brazil’s adventure in the pre-salt to the space race undertaken by the US in the 1960: John Kennedy wanted to go to the moon.  It seemed impossible, but the US did it.  The same would be true of the pre-salt oil project.

A column by Ancelmo:


Eike Batista found oil only 130 km off the coast of Parati in shallow water. A preliminary estimate is that this field, discovered by OGX, may hold 3 billion barrels of light crude.

Dilma and Lobão were kept abreast of the development.

And now the editoral by Alcântara:

Eike Xiaoping Batista

Veja reporters sent out to interview the new Brazilian millionaires, a class that grows by 19 every day, told Thaís Oyama, a senior editor assigned to the story, what characteristics these persons have in common. One stood out: They idolize Eike Batista, the most highest rated Brazilian on the Forbes list, where he occupies eighth place. “Exactly what do they admire in Eike,” Thaís asked. With minor variations, the answer came down to the same point: “Eike is not ashamed to be rich.”

In answering the questions, survey subjects emphasized their admiration for the ambition to grow alongside one’s own business and said they prize the right to accumulate wealth and assets with honest hard work and talent.  One’s memory inevitably returns to the ideological change of direction undertaken by Deng Xiaoping in China starting in 1976, when the Chinese issued the edict: “To grow wealthy is glorious”. The results are well-known. China put an end to its collectivist stagnation and now competes on an even field as an industrial giant with the United States.

In his book [O X da Questão], Eike wrote: “Many people do not realize what it means to have a Brazilian at the top of the rankings of billionaires, a home-grown entrepreneur who loves Brazil … who concentrates his investments in the internal market and generates jobs, wealth and tax revenue.

Entrepreneurs who served as case studies for the Veja article are proud of achieving success while paying their taxes, competing on an equal footing and generating quality employment. This triumph of the entrepreneurial spirit is cause for celebration.

The Brazilian has long been associated with the defeatism of Jeca Tatu or, as in the popular saying, with a vision that looks more kindly on the failures of Garrincha while regarding the successes of Pele with suspicion.  This issue of Veja captures that special moment when we start to glorify wealth produced by hard work, honesty, personal investment and the courage to take risks, He [Batista] is the symbol of a more generous age for all Brazilians..