Upstream oil and gas company Philex Petroleum Corp. trimmed its net loss in 2013, thanks in part to gains recorded from a unit’s sale of assets.
In a disclosure to the Philippine Stock Exchange, Philex Petroleum said Thursday its audited consolidated net loss in 2013 shrank to P101.2 million from a net loss of P1.1 billion in 2012.
The company said it recorded a gain of P246.6 million from the sale of assets of unit Pitkin Petroleum Plc’s (Pitkin), which helped to trim its losses for the year, whereas in 2012, it made a provision of P966.9 million for the impairment of the assets in Brixton Energy and Mining Corp. and Forum Energy Plc.
In April last year, Philex Petroleum increased its shareholding in Pitkin from 18.46 percent to 50.28 percent. It bought new and existing shares at $0.75 per share, for a total consideration of $34.80 million or approximately P1.43 billion.
On July 16, 2013, Pitkin completed the sale of all its interests in Vietnam American Exploration Co. LLC, a Delaware-based company, for a total cash consideration of approximately P2.1 billion. As a result of the transaction, the company recorded a gain of P213 million.
Brixton Energy, a wholly owned subsidiary of Philex Petroleum, also finalized in the middle of last year agreements for the assignment of Coal Operating Contract 130 (COC 130) in Zamboanga Sibugay to Grace Coal Mining and Development Inc.
The underground coal mines in COC 130 were closed in September 2013 after operations were suspended in January due to low coal prices. The assignment is subject to the approval of the Department of Energy (DOE).
The DOE also awarded Service Contract 75 (SC 75) to the consortium of Philex Petroleum (50 percent as operator), PNOC Exploration Corp. (35 percent) and PetroEnergy Resources Corp. (15 percent). SC 75 covers Area 4 in the Northwest Palawan Basin that was offered during the 4th Philippine Energy Contracting Round (PECR4).
Prior to this, the DOE had awarded Service Contract 74 (SC 74) to the consortium of Pitkin (70 percent as operator) and Philodrill Corp. (30 percent). SC 74 covers Area 5 in the Northwest Palawan Basin that was also offered during the PECR4.
As of December 31, 2013, Philex Petroleum said it had consolidated cash of P2.6 billion, which will enable the company to fund ongoing exploration activities and selective acquisition of new opportunities.
An Environmental Impact Study to drill up to 10 exploration and 10 appraisal wells in Peru Block Z-38, in which Pitkin holds a 25-percent interest, was approved on June 19, 2013.
The drilling of at least two wells is expected to start during the second half of this year.