PXP Energy Corp. incurred a net loss of P1.71 billion last year, significantly more than the P56.1 million it suffered the earlier year, due to the impairment of its oil and gas assets in Peru, the listed upstream oil and gas company said.
In its financial report to the exchange, PXP Energy said it spent P1.65 billion for the disputed assets in offshore Peru, wherein its subsidiary Pitkin Petroleum Ltd. (Pitkin Peru) partnered with Australia’s Karoon Energy Ltd.’s wholly owned unit KEI (Peru Z-38) Pty. Ltd. Sucursal del Peru for an exploration project in Peru’s block Z-38.
Pitkin Peru earlier claimed that KEI did not fulfill its obligations when it did not give notice on whether it will extend its contract for the fourth exploration phase for discovering hydrocarbons. This prompted the Peru government to terminate the contract, requiring Pitkin Peru to shoulder expenses in the drilling works.
In September last year, the Australian company agreed to pay $9.6 million to Pitkin Peru in connection with the said offshore block.
PXP Energy’s consolidated petroleum revenues last year went up by 112% to P64.2 million as the average price of Galoc crude rose by 75.4% to P$69.68 per barrel. Output in Service Contract (SC) 14C-1 Galoc, on the other hand, declined.
The oil and gas exploration firm’s consolidated costs reached P102.67 million last year, 4.1% higher what was spent in 2020 due to higher production costs in SC 14C-1 at P40.59 million, up 18.9%.
Meanwhile, overhead expenses was marginally lower at P62.1 million compared with the P64.5-million recorded in 2020, the company said.
“Each of Forum Energy Plc and PXP Energy is focused on fulfilling its work commitments for 2022 which have been approved by the Philippine government,” the company said in an earlier disclosure to the exchange.
Forum Energy is a UK-incorporated upstream oil and gas company with focus on the Philippines in which PXP Energy has a 67.19% controlling interest.
PXP Energy said its commitments this year include the drilling of two appraisal well over Sampaguita gas field in SC 72 and the operation of a 3D seismic survey in SC 75 in offshore northwest of Palawan.
“Meanwhile, the group shall continue to pursue explorations with respect to its other projects in the Philippines including SC 40 and SC 74,” the company added.
Forum Exploration, Inc. is the sole operator of SC 40 or the Libertad gas field. PXP Energy has a 70% interest in SC 74 northwest of Palawan.
PXP Energy shares at the local bourse rose by 17 centavos or 2.65% to close at P6.58 apiece on Tuesday. — Marielle C. Lucenio