PXP Energy exploring options for activities in West Philippine Sea

MANILA, Philippines — Pangilinan-led PXP Energy Corp. wants to work with the government to explore potential arrangements in its contract areas in the West Philippine Sea (WPS) that are currently under force majeure.

PXP operates Service Contract (SC) 72 Recto Bank, indirectly through Forum Energy Ltd. (FEL), and directly holds SC 75 northwest Palawan. Exploration activities in both areas remain suspended due to geopolitical tensions in the disputed waters.

“Each of PXP Energy Corp. and Forum Energy Ltd. will continue to coordinate with the government on any possible arrangement of activities in both SC 72 and SC 75,” PXP said in a regulatory filing yesterday.

Energy Undersecretary Alessandro Sales told The STAR last week that the moratorium on energy exploration in the WPS is “still in place,” countering reports that Malacañang has lifted the ban.

While the moratorium remains in effect, PXP is directing its resources toward studying and assessing other oil and gas fields.

“Exploration work in SC 40 will be pursued. (In the meantime), PXP will assess and study other oil and gas projects within the Philippines,” it noted.

FEL unit Forum Exploration Inc, which operates SC 40 in north Cebu, recently completed additional assessment studies on select onshore prospects that show potential for petroleum accumulation.

To test those prospects, geological and drilling programs were said to have been prepared for an exploration well, which could be drilled within the next two years.

Meanwhile, the Galoc oil field in northwest Palawan continues to operate profitably despite natural depletion.

PXP narrowed its core net loss by 29 percent to P9.5 million in the first half from the P13.4 million incurred a year ago, thanks to a higher average crude oil price and increased volume lifted from Galoc operations.

The consolidated net loss attributable to parent’s equity holders was also lower at P9.2 million, down by 28 percent from P12.7 million in the same period in 2023.

Total petroleum sales rose by 9.1 percent to P42.9 million from P39.4 million on the back of a slight improvement in average crude price and output sold from the Galoc field during the period.

Costs and expenses, on the other hand, marginally increased to P49.1 million from P48.7 million following higher product costs, which was partly offset by lower recurring overhead.

Earlier, PXP surrendered SC 74 Linapacan block in northwest Palawan to the government after failing to identify any drillable prospects in the area.

The move would not have a material impact on the company’s financial statements this year, it added.