Upstream M&A takes back seat in 2Q 2015

Offshore staff

HOUSTON PwC US has found that upstream oil and gas deals were surpassed by midstream transactions in 2Q 2015 mergers and acquisitions.

Total upstream deal activity continued to drop in the second quarter, accounting for 18 transactions representing $8.3 billion, or a decrease of 55% and 67% in total deal volume and value, respectively, compared to the same period in 2014.

Additionally, the total number and value of oilfield services deals decreased 33%, to four deals, and 40%, to $1.6 billion, respectively, when compared to the same period last year.

The number of deals in the midstream segment jumped 110% while value increased 130% compared to 2Q 2014. There were 21 midstream deals, or 44% of total deal activity, contributing $27.7 billion in value, said PwC US.

For the period ending June 30, 2015, there were a total of 47 oil and gas deals (with values greater than $50 million) accounting for $38.8 billion, compared to 39 deals worth $34.5 billion in the first three months of the year, and 65 deals worth $48.9 billion in 2Q 2014.

“Financial investors see opportunities to make investments as companies adjust their portfolios in this dynamic environment,” said Rob McCeney, PwC US energy & infrastructure deals partner. “With cash on hand and experienced management teams in place, we expect to see more private equity commitments and deals in the second half of 2015.”

08/05/2015

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