MANILA - Shares of PXP Energy Corp. closed 18.54 percent higher on Wednesday amid optimism that it will be allowed to resume drilling for oil and gas in the West Philippine Sea.

Investors snapped up PXP shares a day after visiting Chinese Foreign Minister Wang Yi said he supported the idea of joint energy ventures with the Philippines in the disputed waters, where the two countries have conflicting claims.

Drilling at the Reed Bank, also called Recto Bank by the Philippines, was halted in 2014, amid escalating tensions with China, which claims that the area falls within its territory.

• READ: PH warned vs joint exploration deal with 'good neighbor' China

On July 12, the Department of Energy said drilling at the Reed Bank might resume before the end of the year, and that the government was preparing to offer new blocks to investors in a bidding set in December.

Foreign Affairs Secretary Alan Peter Cayetano, however, said on Wednesday that any joint venture with China in the West Philippine Sea must follow the Philippine Constitution.

Meanwhile the Philippine Stock Exchange index breached the 8000-level, gaining 0.83 percent and closing at 8,037.