Market ends week on sluggish note
President Duterte’s go signal for the resumption of oil and gas exploration in the West Philippine Sea has perked up investor appetite for mining/oil stocks with economic interest in service contracts disrupted by the territorial dispute between the Philippines and China for the last six years.
The biggest beneficiaries were PXP Energy Corp.and Atok Big Wedge, whose shares surged by nearly 50 percent due to a West Philippine Sea exploration play in the market on Friday.
Apex Mining gained 34.84 percent and was the day’s most actively traded company.
Shares of PXP’s parent, Philex Mining, rose 20.76 percent. The mining/oil counter was up by 10.79 percent.
The main-share Philippine Stock Exchange index (PSEi), however, shed 39.86 points or 0.67 percent to close at 5,898.47 as investors trimmed their holdings of large-cap stocks to focus on plays outside the PSEi.
“We can only surmise that the unusual price movement [on mining/oil stocks] can be attributed to the announcement that President Duterte has lifted the moratorium on oil and sea exploration in the West Philippine Sea …” Atok Big Wedge said in a disclosure to Philippine Stock Exchange.
Energy Secretary Alfonso Cusi has given the “resume to work” notice to service contractors doing petroleum exploration in service contracts (SC) 59, 72 and 75.
Atok Big Wedge subsidiary Tidemark Holdings Ltd. has a 20-percent interest in Forum Energy Ltd., which in turn has 70 percent economic interest in SC 72, in offshore west of Palawan and is host to the Sampaguita gas discovery. Drilling in the area had been placed on hold in 2014 pending the resolution of territorial sovereign disputes.
PXP holds a 79.13 percent in Forum Energy.
Apex Mining unit Monte Oro Resources & Energy has 30 percent interest in SC 72.
In the meantime, the PSEi ended the week on a sluggish note. Market breadth was positive with 118 advancers, 89 decliners while 46 stocks were unchanged. —DORIS DUMLAO-ABADILLA
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