US oil and gas merger and
acquisition (M&A) activity was driven mainly by divestitures of oil and gas
assets over the third quarter of 2013, new research has found.
PricewaterhouseCooper’s (PwC) US quarterly analysis of M&As in the US energy sector, found that 43 oil and gas deals with values of more than $50 million took place over the three months to the end of September this year. Totaling $16.4 billion, these deals represented a drop from the 45 deals which were worth a total of $37.6 billion over the same time period in 2012.
The research also noted a decline in deal volume of 9 per cent from the second quarter of this year to the third quarter, with the value of those deals also dropping by 46 per cent over that time. Earlier this year, PwC attributed the decline in part to oil and gas companies focusing on integrating assets acquired over the previous year.
Of the deals that did take place, divestiture activity accounted for a huge part, representing $13.9 billion in total deal value. In terms of total deal volume, divestiture activity made up 84 per cent, accounting for 36 transactions in total.
PricewaterhouseCooper’s (PwC) US quarterly analysis of M&As in the US energy sector, found that 43 oil and gas deals with values of more than $50 million took place over the three months to the end of September this year. Totaling $16.4 billion, these deals represented a drop from the 45 deals which were worth a total of $37.6 billion over the same time period in 2012.
The research also noted a decline in deal volume of 9 per cent from the second quarter of this year to the third quarter, with the value of those deals also dropping by 46 per cent over that time. Earlier this year, PwC attributed the decline in part to oil and gas companies focusing on integrating assets acquired over the previous year.
Of the deals that did take place, divestiture activity accounted for a huge part, representing $13.9 billion in total deal value. In terms of total deal volume, divestiture activity made up 84 per cent, accounting for 36 transactions in total.
Shale deals represented 15
transactions in the upstream sector, accounting for $5 billion, while no shale
deal activity was recorded in the midstream sector over the time period. In
terms of the most active shale-related players, the Eagle Ford shale formation
in South Texas completed seven total transactions which contributed $1.7
billion to third quarter activity, while North Dakota’s Bakken formation
contributed three deals and $1.8 billion. The Utica formation chipped in two
deals and $284 million over the time period.
The PwC report revealed that foreign buyers and private equity buyers eager to snap up US assets, were responsible for driving the majority of the M&A transactions in the US oil and gas arena.
Foreign buyers completed nine deals in the sector in the third quarter – worth a total of 17 per cent of total deal value and $2.8 billion to the sector – they also pushed up 2012 activity levels, when just four deals worth $4 billion were carried out. Indeed, the number of deals done by foreign buyers rose by an astonishing 800 per cent from the second quarter of this year to the third quarter.
PwC predicted that the interest in the US oil and gas sector would continue to be high for foreign buyers, saying: “Gaining access to technology, a skilled labor force and other intangibles are important factors driving interest in US shale/tight oil assets.”
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The PwC report revealed that foreign buyers and private equity buyers eager to snap up US assets, were responsible for driving the majority of the M&A transactions in the US oil and gas arena.
Foreign buyers completed nine deals in the sector in the third quarter – worth a total of 17 per cent of total deal value and $2.8 billion to the sector – they also pushed up 2012 activity levels, when just four deals worth $4 billion were carried out. Indeed, the number of deals done by foreign buyers rose by an astonishing 800 per cent from the second quarter of this year to the third quarter.
PwC predicted that the interest in the US oil and gas sector would continue to be high for foreign buyers, saying: “Gaining access to technology, a skilled labor force and other intangibles are important factors driving interest in US shale/tight oil assets.”
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