PXP Energy reverts to profitability in Q1

MANILA, Philippines — Upstream oil and gas firm PXP Energy Corp. posted a net income of P11.1 million in the first quarter, a reversal of the P3.7 million loss incurred in the same period a year ago.

In a disclosure to the Philippine Stock Exchange, PXP Energy attributed the turnaround “to higher other income, partially offset by the increase in cost and expenses and marginally lower petroleum revenues.”

In terms of revenues, PXP Energy saw a 3.1 percent decline to P29.7 million.

The company registered a 12.5 percent rise in volume, but this was offset by an 11.8 percent drop in crude oil price during the period.

It also recorded a 13.1 percent increase in consolidated cost and expenses to P46.9 million.

This was “brought about by higher depletion cost in Service Contract 14C-1 Galoc following higher output and  higher group general and administrative expenses due to depreciation charges from Right to Use asset,” PXP Energy said.

The company, formerly called Philex Petroleum Corp., registered net losses from 2012 to 2018 as its coal and oil investments turned sour.

It is pushing for the resumption of oil and gas exploration and development, particularly in Service Contracts 72 and 75 which were affected by a moratorium issued by the  government  in 2014 and 2015 amid rising tension with China.

PXP Energy holds a 78.98 percent operating interest in SC 72 or the contract to explore Recto Bank in the West Philippine Sea through London-listed Forum Energy Plc.

It also has a direct operating interest of 50 percent in SC 75 northwest Palawan.

PXP Energy is waiting  for guidance from the Philippine government in respect of any future activity in the SCs.

“The company is mindful that the Malampaya gas resource, which supplies about 40 percent of Luzon’s power requirements, could be exhausted within the next decade; in that light, resumption of exploration in SC 72 is of national interest.

The company, therefore, remains hopeful that the force majeure imposed on SC 72 and SC 75 will be lifted by the Department of Energy soon for the Company to be able to resume exploration works in these SCs,” it said.