LISTED Oriental Petroleum and Minerals Corp. said on Monday that its net income improved by 7.1% to around $2.50 million last year despite a drop in petroleum revenues caused by the decline in oil prices.
In its annual report filed with the local bourse, the oil exploration company said revenues from petroleum operations slid 69.9% to $1.28 million because of “intense downswing in crude oil prices.”
Oriental Petroleum’s operations primarily depend on Service Contract 14, which has four exploration blocks in areas including Nido, Matinloc, Galoc, and West Linapacan.
“Average price per barrel dropped to US$38.18 in 2020 as compared to US$64.48 in 2019 for Galoc operations. The decline in oil price was mainly due to the oversupply of oil in the world market given COVID-19 (coronavirus disease 2019) pandemic,” the firm said.
It said petroleum revenues last year were impacted by the decline in the performance of its Galoc well 3 and the continued shut-in of Galoc well 4 due to subsurface production issues.
“In addition, Nido and Matinloc Field was terminated permanently in March 2019,” it added, referring to the halting of production in the two fields.
Meanwhile, petroleum production costs dropped 63.6% to $1.68 million due to the lower cost of petroleum production in the Galoc block. These costs include floating, production, marketing fees, and storage and off-loading charges.
Oriental Petroleum shares in the local bourse were unchanged at P0.013 apiece on Monday. — Angelica Y. Yang