You don’t need an expert to tell you that the oil and gas industry has significantly changed over the past three years. Simply looking at crude oil and natural gas prices from 2014 versus today can confirm this. However, understanding how the change in oil prices has affected the value of your oil and gas business is a little more difficult.
Since the start of the oil downturn, more than 120 upstream and oilfield service companies declared bankruptcy. However, as we described in a previous post, the decision to file for bankruptcy did not always signal the demise of the business. Now more prepared, many E&P companies who reorganized are looking to grow.
Artem Abramov, of Rystad Energy, recently published an article in the Oil and Gas Financial Journal comparing shale and offshore drilling. He claims, the “Gulf of Mexico [is] as important as [the] Permian Basin for U.S. oil production” but it has been overlooked since the advancement of shale gas. The EIA reports that offshore drilling accounts for 17% of total domestic crude oil production. So, why aren’t we talking more about oil and gas production from the Gulf of Mexico (GoM)?
2016 was a year to remember and a year to forget for many in the oil and gas industry. On the positive side, energy commodity prices curbed their downward, volatile nature by finishing the year at higher prices than where they started. In this post, we survey how the industry ended the year from production and supply to bankruptcies and transactions as we look to 2017.
Last month we learned something that might not be a shock to those closely following the oil and gas markets, but might be something of a bombshell to everyone else. A report from Rystad Energy estimated that in July 2016, for the first time ever, the United States has more recoverable oil than any other country on the planet – 264 billion barrels. What was the reward for E&P firms? Ironically, it has unfortunately turned out to be a long line at bankruptcy courts.
In May 2016, we attended a panel event discussing investment opportunities in the financially distressed oil and gas sector. The panel included a “who’s who” of oil and gas experts located in Texas. Two industry participants, two consultants, one analyst and one economist discussed the economic outlook for energy prices and then corporate strategy and investment opportunities given the economic outlook. This post, the second and last summarizing this panel discussion, will report opinions given on corporate strategy and investment opportunities.
Upon confirmation by the bankruptcy court, a bankruptcy plan must not be likely to result in liquidation or further reorganization. To satisfy the court, a cash-flow test is used to analyze whether the restructured company would generate enough cash to consistently pay its debts. This post walks through the three steps of a cash-flow test.
In May 2016, we attended a panel event discussing investment opportunities in the financially distressed oil and gas sector. The panel included a “who’s who” of oil and gas experts located in Texas. Two industry participants, two consultants, one analyst and one economist discussed the economic outlook for energy prices; and then corporate strategy and investment opportunities given the economic outlook. This post, the first of two summarizing this panel discussion, will report on the economic discussion.
- Asset Sales
- Bakken Shale
- Domestic Production
- Downstream Analysis
- Eagle Ford Shale
- Marcellus and Utica Shale
- Mergers and Acquisitions
- Permian Basin
- Royalty Trusts
- Special Topics
- Valuation Issues