A weekly update on issues important to the oil and gas industry
M&A transaction activity in the Bakken increased through year-to-date 2022 relative to the same time period in 2021 and consisted of a handful of large deals and numerous small deals. In this post, we discuss Bakken transaction activity as a whole and also dive deeper into the two largest Bakken transactions made this year.
This week we focus on the key takeaways from Oilfield Service Operators’ Q2 2022 earnings calls. We discuss how COVID impacted the OFS industry, a shift in strategy due to limited supply, and the industry’s outlook in the face of a potential recession.
This week, we focus on the key takeaways from the Q2 2022 Upstream earnings calls including strong balance sheets, the increasing role of share buybacks, and supply and demand in the global oil & gas commodities market.
Mercer Capital has its finger on the pulse of the minerals market. An important trend has been the rise of mineral aggregators, which have largely supplanted the trusts as the primary method of publicly traded minerals ownership.
In this updated Study, Mercer Capital has thoughtfully analyzed the corporate and capital structures of the publicly traded mineral aggregators to derive meaningful indications of enterprise value. We have also calculated valuation multiples based on a variety of metrics, including distributions and reserves, as well as earnings and production on both a historical and forward-looking basis.
Mercer Capital’s Value Focus: Exploration & Production newsletter provides an overview of the industry through supply and demand analysis, commodity pricing, and public market performance. In addition, each issue of this quarterly newsletter focuses on a region, including, Eagle Ford, Permian, … Continued
A fundamental question arises as mergers and acquisitions persist and company boards and management teams survey their options when a proposed transaction is put on the table: is it fair to all direct stakeholders? This post reviews the basics of fairness opinions and when you should obtain one.
Producers have been holding the course towards returns and deleveraging, snubbing pressure from the Biden administration. It has been tempting for producers to ramp up production amid current oil and gas prices. However, with supply chain issues and labor shortages, the appeal has been dampened.
In each “Meet the Team” segment, we highlight a different professional on our Energy team. This week we highlight David Smith, Senior Vice President of Mercer Capital and a senior member of the Oil and Gas Industry Team. The experience and expertise of our professionals allow us to bring a full suite of valuation, transaction advisory, and litigation support services to our clients. We hope you enjoy getting to know us a bit better.
In Part 1 of our analysis on U.S. LNG Export Terminal Facilities, we examined trends in the number of LNG export facility applications and approval rates from 2010 through 2021, and examined the projected export capacity relative to the projected export volumes of U.S. LNG from 2022 through 2031. In Part 2 of our analysis, we take a closer look at the anticipated export capacity proposed to come online over the near and mid-term horizons to better understand the underlying factors that have spurred so many projects, seemingly far in excess of projected level of LNG exports from the U.S.
Acquirers of companies can learn a valuable lesson from the same approach that pro sports teams take in evaluating players. Prior to draft night, teams have events called combines where they put prospective players through tests to more accurately assess their potential. In this scenario, the team is akin to the acquirer or investor and the player is the seller. While a player may have strong statistics in college, this may not translate to their future performance at the next level. So it’s important for the team to dig deeper and analyze thoroughly to reduce the potential for a draft bust and increase the potential for drafting a future all-star.
A similar process should take place when acquirers examine acquisition targets. Historical financial statements may provide little insight into the future growth and earnings potential for the underlying company. One way that acquirers can better assess potential targets is through a process similar to a sports combine called a Quality of Earnings Study (QoE).
