Pangilinan-led PXP Energy Corporation has increased its stake in Forum Energy, the corporate vehicle that will lead targeted exploration and development at the Recto Bank oil and gas upstream venture in Northwest Palawan.
The company said it hiked direct shareholdings in FEC Resources Inc. (FEC) to 78.39-percent from 54.99-percent; and had similarly increased economic interest in Forum Energy Ltd. to 77.66-percent from 76.07-percent.
“The additional interest was acquired through a subscription to 449,999,986 new ordinary shares of FEC through a stock rights offering,” PXP Energy has stipulated in its disclosure to the Philippine Stock Exchange. Business magnate Manuel V. Pangilinan is the chairman of PXP Energy.
The company further indicated “the new shares were issued at approximately US$0.00225 per share for a total consideration of US$1,012,499.97.” FEC is a holding company incorporated in Alberta, Canada and holds interest of 6.8-percent in Forum Energy Ltd., an oil and gas company incorporated in the United Kingdom.
Forum Energy has investment focus in oil and gas exploration in the Philippines – and its principal asset is its 70-percent interest in Service Contract 72, or the license for the 8,800 square kilometers of offshore petroleum exploration in Palawan.
Proposed extended seismic survey and drilling at the Recto Bank had been suspended by the Philippine government until such time that the country can strike a “mutually acceptable framework” with the Chinese government on the exploration and development of resources in the disputed territories of the West Philippine Sea.
Given the slump in oil prices globally and its stalled exploration activities on key projects, PXP Energy reported that it logged a wider consolidated net loss of P56.3 million in the first half of this year versus P17.9 million in the same period in 2019.
The company’s consolidated petroleum revenues also plunged by 88-percent to P6.1 million from last year’s P51.4 million.
The deceleration in the firm’s financial performance, according to PXP Energy, had been attributed mainly to “66-percent lower output following normal decline rate in field production and one completed lifting.”
The company likewise noted the 62-percent slump in crude oil prices, primarily affecting yield from its Service Contract 14C-1 at the Galoc field in Palawan, and that had been linked to “substantially lower global demand amidst the ongoing Covid-19 pandemic.”
PXP Energy said it was able to manage its cost and expenses – at 46.7-percent lower to P39.5 million vis-à-vis P86.2 million last year.
It explained that such cost reduction was achieved due to “lower depletion cost in SC 14-C Galoc, following the decline in output;” plus the group’s general and administrative expenses had been slightly lower year-on-year.