Shares of oil and gas exploration company PXP Energy Corp (PXP) surged by 11.2 per cent on the local stock market on Wednesday, boosted by expectation that it could soon resume exploration in Recto Bank now that the Philippines and China had agreed on a joint venture to develop gas deposits in the West Philippine Sea.
PXP’s share price climbed to 12.34 pesos ($0.24) per share at Wednesday’s close from 11.30 pesos in the previous session, but tumbled to 12.30 pesos on Thursday.
The guidelines for the joint exploration have been signed and an intergovernmental steering committee was created.
While the joint venture is worked out on the government-to-government level, it is expected to make room for private companies in the future.
Energy Secretary Alfonso Cusi earlier said the joint venture with China could eventually include private sector participants.
The companies appointed by the Chinese and Philippine governments to spearhead the joint exploration were China National Offshore Oil Corp (CNOOC) and Philippine National Oil Co (PNOC), both government-owned corporations.
PNOC’s oil, gas and coal exploration arm is PNOC Exploration Corp.
PXP hopes the moratorium imposed on its two concession areas at Recto Bank will be lifted soon so it can resume exploration.
A source from PXP said there wasn’t any notification yet on the lifting of the moratorium. “But [it] should be forthcoming,” the source said.
The moratorium was imposed after the Philippine government challenged China’s claim over nearly the entire South China Sea in the UN-backed Court of Permanent Arbitration in The Hague in 2013.
In July 2016, the court ruled in favour of the Philippines, invalidating China’s sweeping claim and declaring it in violation of the Philippines’ sovereign right to fish and explore resources in the West Philippine Sea, waters within the country’s 370km exclusive economic zone in the heavily disputed South China Sea. PHILIPPINE DAILY INQUIRER