While Reese Energy Consulting continues to study crude oil takeaways and market options at Cushing for several clients, we’re also looking at the whirlwind of oil and gas mergers and acquisitions that continues its sweep across our energy industry. In Q3, M&A transactions totaled $31 billion—up a staggering 300% from Q2 that saw a paltry $7 billion. BP certainly will play the year’s starring role for M&A activity with its $10.5 billion acquisition of BHP’s onshore oil and gas assets announced in July. The deal brings BP vast oil and gas production and resources in the Permian and Eagle Ford in Texas and in the Haynesville in Texas and Louisiana. Coming in at a close second is Diamondback’s $9.2 billion acquisition of Energen in August—a move that all but eliminated the rivalry between the two producers in the Permian, and boosted Diamondback’s ability to better compete for pipeline transportation and other services. Higher oil prices have no doubt fueled this momentum with analysts predicting we could see another $50 billion in additional deals by end of year. What do you think?
Posted on October 11, 2018