Derek P. Smith

ABV

Senior Financial Analyst

Derek Smith is a Senior Financial Analyst with Mercer Capital. He has valuation experience in engagements related to corporate planning and reorganizations, financial reporting, fairness opinions, litigation support, employee stock ownership plans, and estate and gift tax planning and compliance matters.

As a member of Mercer Capital’s Family Business Advisory Services Group, Derek provides financial education, valuation, and other strategic financial consulting to multi-generation family businesses. The Family Business Advisory Services Group helps family shareholders, boards, and management teams align their perspectives on the financial realities, needs, and opportunities of the business.

Derek is also a member of the firm’s Oil & Gas Industry team. As a part of the Oil & Gas Industry team, he provides content for the Energy Valuation Insights blog and quarterly newsletter.

Professional Designations

Accredited in Business Valuation (The American Institute of Certified Public Accountants)

Education

Louisiana State University, Baton Rouge, Louisiana (B.S., Finance, 2018)

Authored Content

Digging Into Frac Sand Royalty Valuation

Frac sand royalty valuation requires more than applying a royalty rate to estimated reserves. A supportable analysis must consider lease terms, recoverable and saleable tonnage, production timing, regional demand, and the risks that affect future royalty cash flows.

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Why Are Shareholders Surprised by Board Decisions?

You Asked. We Answer.

Clear communication and sustained shareholder education can help family business owners understand the trade-offs behind board decisions. Giving shareholders greater context can reduce surprises, improve strategic discussions, and strengthen governance.

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E&P Second Quarter 2026

Region Focus: Permian Basin

The Permian Basin continued to demonstrate its resilience in the twelve-month period through June 30, 2026 (the review period). Despite a modest decline in rig counts, production reached new highs as operators continued to emphasize capital discipline, drilling efficiencies, and productivity improvements. Heightened geopolitical tensions introduced considerably greater volatility into commodity markets during the latter portion of the review period, yet oil prices ended above year-earlier levels and Permian public companies posted strong stock price appreciation. While basin operators continue to balance disciplined capital allocation with long-term production growth, the Permian remains the nation’s premier oil-producing basin and continues to demonstrate its ability to adapt to changing market conditions.

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Should We Borrow Money If We Don’t Have To?

You Asked. We Answer.

Thoughtful borrowing can strengthen a family business when it aligns with strategy, preserves financial flexibility, and supports long-term shareholder value. Directors should evaluate debt as a governance decision rather than assuming a debt-free balance sheet is always the most prudent choice.

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Takeaways from the 2026 Hart Energy Capital Conference

Capital Returns, Natural Gas Grows, and Scarcity Persists

Hart Energy's 2026 Energy Capital Conference brought together operators, investors, lenders, and advisors to discuss the forces shaping capital allocation across the energy sector. While topics ranged from LNG exports and data center power demand to asset-backed securitizations (“ABS”) and private equity continuation vehicles, four themes consistently emerged throughout the day.

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Just Released: Q1 2026 Oil & Gas Industry Newsletter

Region Focus: Eagle Ford

The Eagle Ford exhibited modest production growth over the past year, broadly in line with other major basins, as output remained within a relatively narrow range. This stability reflects the basin’s maturity, with limited variability in production despite declining rig counts and continued capital discipline among operators.

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E&P First Quarter 2026

Region Focus: Eagle Ford

Eagle Ford // The Eagle Ford exhibited modest production growth over the past year, broadly in line with other major basins, as output remained within a relatively narrow range. This stability reflects the basin’s maturity, with limited variability in production despite declining rig counts and continued capital discipline among operators.

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Themes from the Q4 2025 Energy Earnings Calls

Fourth quarter 2025 earnings calls suggest an industry preparing for a transitional 2026, emphasizing organic inventory expansion, structural natural gas demand growth, and tightening service market fundamentals. Management teams appear focused less on short-term volatility and more on positioning for the next upcycle.

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E&P Fourth Quarter 2025

Region Focus: Haynesville Shale

The Haynesville demonstrated resilient performance in 2025, with production growth outpacing peer basins despite pronounced month-to-month volatility. Output gains were supported by efficiency improvements and DUC drawdowns, even as rig activity, while rebounding meaningfully from interim lows, remained well below prior cycle peaks. Natural gas front-month futures pricing provided episodic support for activity, with seasonal demand and tightening balances driving a late-year rally after summer weakness.

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Themes from Q3 2025 Earnings Calls

Third-quarter commentary from E&P and oilfield service companies highlighted a cautious near-term outlook paired with growing confidence in long-term demand. While operators remain in “maintenance mode,” structural growth themes—LNG, data centers, offshore development, and water midstream—continue to shape strategy. Despite softer activity, companies emphasized free cash flow, efficiency, and positioning for stronger demand later in the decade.

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Themes from Q2 2025 Earnings Calls

Disciplined Capital Allocation Meets International Opportunity Amid Domestic Uncertainty

The second quarter of 2025 brought no shortage of talking points across both oilfield services (“OFS”) providers and exploration and production (“E&P”) companies. Management teams faced questions on market softness, capital discipline, and whether the long-awaited offshore and international upcycle has truly taken hold. Some leaned into shareholder returns and consolidation, others stressed patience in a choppy pricing environment, and nearly all pointed to selective opportunities abroad as a counterweight to domestic headwinds.

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Capital Shifts and LNG Lifts

Takeaways from the 2025 Hart Energy Capital Conference

The energy industry is at a critical point, where producers must not only meet the ever-growing global energy demand resulting from population growth, industrialization, and the increasing electrification of uses, but also adapt to ever-changing environmental regulations and shifting societal expectations related to sustainable practices.

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E&P Second Quarter 2025

Region Focus: Permian

Permian // The Permian basin continues to serve as the centerpiece of the U.S. shale revolution.

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E&P Third Quarter 2025

Region Focus: Appalachia

Appalachia // The Appalachian basin enters late-2025 on firmer footing than a year ago, characterized by stable production, recovering equity performance, and improving infrastructure fundamentals

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Key Components in a Typical Oil & Gas Lease

When negotiating and drafting oil and gas leases, understanding the basic framework that governs these agreements is essential. While there is no true “standard” lease, the primary areas and considerations of an oil and gas lease are discussed in this post.

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Themes from Q4 2024 Earnings Calls

Upstream (E&P) and Oilfield Service (“OFS”) Companies

Companies are evaluating the trade-offs between optimizing existing assets and pursuing mergers and acquisitions. Capital allocation remains a focal point, with an emphasis on debt reduction and shareholder returns. Additionally, firms are positioning themselves to navigate evolving market conditions, ready to capitalize on emerging opportunities. This analysis offers valuable insight into the strategies industry leaders are employing for the future.

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E&P First Quarter 2025

Region Focus: Eagle Ford

Eagle Ford // Despite a notable rig count decline, Eagle Ford production generally remained about flat over the twelve months ended March 2025.

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E&P Fourth Quarter 2024

Bakken, DJ Basin, and Woodford Shale

Bakken, DJ Basin, and Woodford Shale // As a supplement to our usual regional coverage, this quarter we take a closer look at the Bakken, DJ Basin, and Woodford Shale. On an oil equivalent basis, the DJ Basin ended the review period 2% below production levels from a year earlier, while the Bakken ended at nearly 5% lower. Only the Woodford Shale ended the review period at a level above its November 2023 production, though at a negligible 0.1% higher.

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What’s “Play”-ing in the DJ Basin?

An Introduction to the Denver-Julesburg Basin

The Denver-Julesburg (“DJ”) Basin is a vast and geologically complex basin marked by sedimentary layering, tectonic shifts, and hydrocarbon generation. Encompassing an area of approximately 20,000 square miles, it stretches across regions of Colorado, Wyoming, Nebraska, and Kansas. Notable within the basin are various fields and geological formations, including the Wattenberg Field, Niobrara, Codell, Greenhorn, Adena Field, Hereford area, and the Redtail Field area.

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E&P Third Quarter 2024

Appalachian Basin

Appalachian Basin // Appalachian production declined over the last twelve months due to reduced drilling activity, driven by low natural gas prices and high storage inventory.

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Themes from Q1 2024 Energy Earnings Calls

Upstream (E&P) and Oilfield Service (“OFS”) Companies

In our prior earnings call post, Themes from Q4 2023 Energy Earnings Calls, we touched on the global focus that both the Upstream and OFS segments had focused on and the persistent drive to optimize efficiency in well operations and services with technological advancements, durable inventory, and more. This week, we explore the Q1 2024 earnings calls of upstream and OFS companies, highlighting the appearance of this quarter’s themes across the entire sector.

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The Beginning of a Bakken Behemoth

Chord Energy and Enerplus

In a significant development for the energy industry, on February 21, 2024, Chord Energy Corporation and Enerplus Corporation announced a definitive agreement to merge. This strategic combination aims to create a powerhouse in the Williston Basin, leveraging their complementary strengths and operational expertise.

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E&P Second Quarter 2024

Permian

Permian // Permian production growth over the past year was a positive outlier among the four basins covered in our analysis, with Eagle Ford, Appalachia, and Haynesville all posting production declines (albeit Appalachia’s decline being insignificant at 0.3%).

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Themes from Q4 2023 Energy Earnings Calls

Upstream (E&P) and Oilfield Service (“OFS”) Companies

This week, we delve into the Q4 2023 earnings calls of upstream and OFS companies, underscoring the consistent emergence of these themes across the entire sector.

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E&P First Quarter 2024

Eagle Ford

Eagle Ford // Despite significant rig-count declines, Eagle Ford production declined only modestly over the twelve months ended March 2024, aided by a significant number of DUCs going into production.

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Themes from Q3 Energy Earnings Calls-Part 2: Oilfield Service Companies

Themes from Q3 2023 Energy Earnings Calls

Part 2: Oilfield Service (“OFS”) Companies

In our most recent earnings call blog post, Themes from Q3 2023 Earnings Calls, Part 1 Upstream, prevalent themes from E&P companies included discussions about consolidation in the industry, a focus on efficiency of operations, and strong production volumes throughout 2023. This week, we focus on the key takeaways from OFS operators’ Q3 2023 earnings call.

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Themes from Q2 2023 Energy Earnings Calls-Part 2: Oilfield Service Companies

Themes from Q2 2023 Earnings Calls

Part 2: Oilfield Service (“OFS”) Companies

This week, we focus on the key takeaways from OFS operators’ Q2 2023 earnings call.

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IRS Valuation Guidance

Mines, Oil and Gas Wells, & Other Natural Deposits

In this blog post, we discuss portions of Treasury Regulation 1.611 and its additional guidance when determining the fair market value of mineral properties.

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Themes from Q4 2022 Earnings Calls

Part 2: Oilfield Service Companies

The common themes among E&P operators and mineral aggregators’ in the Q3 2022 upstream earning calls included expanding business segments internationally, long-term sustainable growth for OFS, and production growth plans. In our most recent blog post, Themes from Q4 2022 Earnings Calls, Part 1 Upstream, prevalent themes from E&P companies included dividend distribution, organic growth, and management optimism regardless of upcoming economic challenges. This week we focus on the key takeaways from oilfield service operators’ Q4 2022 earnings call.

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Services

Industries

About

Insights

Derek P. Smith

ABV

Senior Financial Analyst

Authored Content

Digging Into Frac Sand Royalty Valuation

Why Are Shareholders Surprised by Board Decisions?

E&P Second Quarter 2026

Should We Borrow Money If We Don’t Have To?

Takeaways from the 2026 Hart Energy Capital Conference

Just Released: Q1 2026 Oil & Gas Industry Newsletter

E&P First Quarter 2026

Themes from the Q4 2025 Energy Earnings Calls

E&P Fourth Quarter 2025

Themes from Q3 2025 Earnings Calls

Themes from Q2 2025 Earnings Calls

Capital Shifts and LNG Lifts

E&P Second Quarter 2025

E&P Third Quarter 2025

Key Components in a Typical Oil & Gas Lease

Themes from Q4 2024 Earnings Calls

E&P First Quarter 2025

E&P Fourth Quarter 2024

What’s “Play”-ing in the DJ Basin?

E&P Third Quarter 2024

Themes from Q1 2024 Energy Earnings Calls

The Beginning of a Bakken Behemoth

E&P Second Quarter 2024

Themes from Q4 2023 Energy Earnings Calls

E&P First Quarter 2024

Themes from Q3 2023 Energy Earnings Calls

Themes from Q2 2023 Earnings Calls

IRS Valuation Guidance

Themes from Q4 2022 Earnings Calls

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