A weekly update on issues important to the oil and gas industry
Don Erickson, Managing Director of Mercer Capital, educates the public on valuation methodologies and trends impacting various industries. One such industry is Oil & Gas. In this slide deck, he discusses the main drivers impacting the oil and gas pricing environment over the previous decade and the implications to valuing reserves.
Mercer Capital again attended the NAPE Expo in Houston this past week. People, information, and ideas abounded with over 11,000 participants and 800 exhibitors. We summarize a few highlights from the conference in this post.
Lately, talk of the domestic oil and gas market has been especially positive. But the oilfield services industry is still struggling to recover from the collapse of oil prices in mid-2014 and the subsequent reduction in capital spending by upstream companies. We look at how the downturn in crude prices in 2014 still affects the oilfield service industry and consider the impact on company valuations.
A reserve report is a fascinating disclosure of information. This is, in part, because the disclosures reveal the strategies and financial confidence an E&P company believes about itself in the near future. Strategies include capital budgeting decisions, future investment decisions, and cash flow expectations. This is the first of multiple posts discussing the most important information contained in a reserve report, the assumptions used to create it, and what factors should be changed to arrive at Fair Value or Fair Market Value.
This week we look back at transaction activity and trends in the Marcellus & Utica plays in 2017. When we reflect about what happened, for whatever reason, images resembling something out of an episode of Desperate Housewives come to mind whereby the prying eyes of the marketplace peer out of their windows, surveilling old competitors that pack up and leave whilst new, and sometimes mysterious, neighbors move in. Read more about it here.
The economics of oil and gas production vary by region. The cost of producing oil and gas depends on the geological makeup of the reserve, depth of reserve, and cost to transport the raw crude to market. This post focuses on the economics in the Marcellus and Utica plays.
“Steady as she goes.” At least that is what I think all captains of most vessels say…except maybe a car. For captains navigating the 2018 oil and gas industry, a repeat of 2017’s relatively calm waters is vocal wish. In this post, we review the past year for insight into what the new year may hold.
Transaction activity in the Bakken shale was both busy and revealing in the second half of 2017. Many of these deals marked the departure of a number of companies that were known to be active in the play, particularly Halcon Resources. Other companies, however, have remained. This post digs deeper into this.
In this post we address why the shift in oil futures from contango pricing to backwardation is a bearish sign for those in crude oil storage.
As business valuation experts, we have to consider the outlook for the economy, industry, and business in every valuation; therefore, we pay attention to the oil and gas regulatory environment to assess what it means for our clients. Given the new administration, there is much to consider.
