John Eric Francia
ACE Enexor, Chairman
Annual Stockholders’ Meeting | 19 April 2021
Esteemed shareholders, my colleagues on the Board and management, ladies and gentlemen, good afternoon to all of you.
2020 was an exceptionally difficult year for everyone. I would like to thank the men and women of ACE Enexor and the AC Energy group who remained committed to deliver amidst the challenges, and for living the true spirit of Bayanihan along with the rest of the Ayala group.
Reeling from the effects of the pandemic, the global oil and gas industry experienced severe contraction due to the steep drop in consumer demand and the threat of shortage of storage capacities. For the first time in history, the price of West Texas intermediate slumped briefly to negative in April 2020. The second half of 2020 was characterized by relatively stable crude oil prices at between $40 to $45 per barrel, a significant plunge from pre-pandemic levels of around $60 per barrel.
Enexor was not spared from the impact of the pandemic, which has delayed our preparations for the planned drilling of our service area. We have sought a one year force majeure with the DOE.
The company values the opportunity to help the country in its quest for energy security by exploring for and developing indigenous gas resources. Notwithstanding the continuing mobility and other restrictions ushered in by the pandemic, our company remains focused on its commitment to drill a deepwater well in the SC 55 block in 2022. Technical studies aimed at further evaluating the prospects as well as preliminary drilling preparations were completed during the year in review. Barring any unforeseen events, Enexor will undertake definitive drilling planning in the second quarter of 2021.
We are cautiously optimistic that the rollout of vaccines worldwide would help stimulate commercial activity to fuel revival of the upstream industry. The signs in the first quarter of 2021 are promising. Oil prices have rebounded to pre-COVID levels and drilling activities, particularly in the region, are slowly picking up. We are hoping the trend would be sustained in the near term.
We look forward to your steadfast support in the coming years as Enexor pursues its vision to discover and develop clean, reliable and indigenous energy resources for the benefit of the country and its people.