Amid its ongoing exploration program, Manuel V. Pangilinan-led PXP Energy Corp. widened its net loss in the first half of the year, weighed down by lower crude prices, reduced production volumes, and elevated financing costs.

In a disclosure to the Philippine Stock Exchange on Tuesday, Aug. 4, PXP Energy reported a core net loss of ₱25.7 million for the six-month period, compared with the ₱21.1 million core net loss recorded a year earlier.

The listed energy firm attributed the weaker performance primarily to the 36 percent drop in consolidated petroleum revenues to ₱21.2 million from ₱33.2 million. This was driven by a 44.1 percent decline in volume sold, logging a single lifting of 156,983 barrels during the period compared with two liftings totaling 280,742 barrels a year ago.

The volume slump was further compounded by an 11.1 percent drop in the effective average crude price, which averaged $62.9 per barrel from $70.74 per barrel previously.

Net financing costs also climbed sharply to ₱10.3 million from ₱2.1 million, driven by higher net interest expenses of ₱4.3 million and a foreign exchange loss of ₱6.0 million due to the depreciation of the peso against the US dollar on its foreign currency-denominated loans.

Partially offsetting the revenue decline were lower petroleum production costs, which eased to ₱19.3 million from ₱28.6 million in line with reduced sales volumes, along with a slight dip in general and administrative expenses to ₱24.1 million.

On the operational front, PXP Energy made strides in expanding its upstream footprint following the Department of Energy’s (DOE) execution of Petroleum Service Contract (SC) No. 91 in the Northwest Palawan Basin on April 13.

The 10-year contract covers 103,034 hectares, including an expanded section of the former SC 6B Cadlao Field, and involves a consortium featuring PXP subsidiary Forum Energy Philippines Corp., Nido Petroleum Philippines Pty. Ltd., The Philodrill Corp., Oriental Petroleum and Minerals Corp., and Alcorn Petroleum and Minerals Corp. The Cadlao Field holds estimated 2C contingent resources of 6.2 million barrels of oil.

Additionally, under SC 80 and SC 81 in the Sulu Sea, PXP and its consortium partners—led by operator Tetragon Energy Ltd.—have kicked off initial exploration. The group awarded a $1.45 million contract to DUG Technology Ltd. to reprocess over 4,000 square kilometers of existing 3D seismic data and up to 3,000 line-kilometers of 2D seismic data to refine the permits' hydrocarbon potential. Fast-track seismic results are expected within six months.

As production at its Galoc field nears the end of its operational life, PXP stated that it remains focused on maintaining capital discipline, refining its portfolio strategy, and actively evaluating opportunities that could generate earlier cash flows.

Chairman Manuel V. Pangilinan recently noted that the firm is looking to raise funds for its various service contracts while actively searching for foreign partners to participate in petroleum exploration.

The company continues to maintain its interests in SC 72 and SC 75, which remain under force majeure. (Gabriell Christel Galang)