MANILA, Philippines — Listed upstream oil and gas firm PXP Energy Corp. managed to trim its net loss last year as plug and abandonment costs in existing projects were cut significantly while awaiting signals from government in prospective assets.
In a disclosure to the Philippine Stock Exchange yesterday, PXP Energy said its net loss plunged to P76.3 million from P297.2 million.
Continuing losses stemmed from the normal decline in petroleum production in its main operating asset, the Galoc Oil field or Service Contract (SC) 14C-1 Galoc, aggravated by the drop in global prices and demand due to the coronavirus (COVID-19) pandemic.
Consolidated petroleum revenues declined by 58.3 percent to P30.3 million as output dropped from 993,761 barrels to 750,506 bbls.
But while revenues plunged, consolidated costs and expenses were slashed by almost half from P190.6 million to P98.7 million due to lower petroleum production costs and depletion in SC 14C-1 Galoc, following the decline in output.
The company also reflected a 38.6 percent improvement in general and administrative expenses to P64.5 million. This was due to a 4.6 percent decrease in recurring overhead from P66.7 million to P63.6 million, as well as the significant reduction to non-recurring plug and abandonments costs from P38.4 million to just P0.9 million.
The company is awaiting signals from government on resuming exploration and development of its assets which were under force majeure for six years.
“Forum and PXP will take guidance from the Philippine government with respect to fulfilling its work commitments in SC 72 and SC 75,” PXP Energy said.
In the fourth quarter of last year, the Department of Energy (DOE) lifted the force majeure for the areas in the West Philippine Sea covered by SC 72 and SC 75.
In October last year, the company received a resume-to-work notice from the DOE related to its operating interest in SC 75 NW Palawan block. Its subsidiary, Forum (GSEC 101) Ltd. also received the same notice from the DOE for its operating interest in SC 72 Recto Bank.