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January 1, 2017

E&P First Quarter 2017

Region Focus: Eagle Ford

Executive Summary 

Oil prices increased over the last twelve months from $38/bbl at March 31, 2016 to $50/bbl at the end of the first quarter 2017. Over the last couple years many companies postponed exploration activities and cut capital projects to drill new wells because of the depressed oil prices. Oil prices have now settled around $50/bbl and producers are working to cut costs and increases efficiency in this new oil price environment. While production has increased across the U.S., producers are still being cautious.

OPEC agreed to cut production by 1.2 million barrels of oil per day starting January 1, 2017.  As of the end of the January, OPEC’s 13 members have generally complied with production cuts (achieving 82% of the pledged cuts) and Russia also held up their end of the deal.  

During CERA week in Houston, OPEC explained their plans to extend the cuts past the June expiration date.  However even if OPEC maintains production cuts, rising U.S. shale oil output is thought to temper the results of OPEC’s reduction in supply. 

As oil prices stabilized somewhat around $50 per barrel, the number of oil and gas companies filing for bankruptcy declined.  Only 7 oil and gas companies went bankrupt in the first quarter of 2017 compared to 17 in the first quarter of 2016 and 70 total in 2016.

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Bryce Erickson to Speak at Hart Energy’s 2026 Energy Capital Conference
Bryce Erickson to Speak at Hart Energy’s 2026 Energy Capital Conference
Mercer Capital is pleased to announce that Bryce Erickson, ASA, MRICS, Managing Director, will speak at Hart Energy’s 2026 Energy Capital Conference, taking place June 3-4, 2026, at The Post Oak Hotel in Houston, Texas.For more than 20 years, Hart Energy’s Energy Capital Conference has brought together energy executives, private equity leaders, investment bankers, institutional investors, and other financial decision-makers to discuss the deals, strategies, and market dynamics shaping the energy industry. This year’s conference will focus on capital deployment, M&A activity, institutional investment trends, and broader energy finance considerations.Erickson will participate in the panel discussion “Asset Valuations in a High-Price World: Separating Signal from Noise.” The session will examine how capital providers, lenders, and operators are valuing energy assets in today’s elevated commodity price environment while keeping long-term fundamentals in focus. Panelists will discuss valuation assumptions, decline curves, financing structures, return thresholds, and strategies for managing downside risk during commodity price cycles.Bryce Erickson leads Mercer Capital’s energy industry practice and has more than 25 years of experience providing valuation and financial advisory services across the energy sector. Since 1998, he has led approximately one thousand engagements involving oil and gas companies, mineral and royalty interests, oilfield services businesses, and related energy assets for purposes including mergers and acquisitions, tax planning, litigation support, financial reporting, financing, and strategic planning. Bryce regularly publishes on oil and gas industry topics through Mercer Capital’s Energy Valuation Insights blog and is also a contributor to Forbes.com’s Energy sector.Mercer Capital works with energy companies, mineral and royalty owners, oilfield services businesses, investors, attorneys, accountants, and financial institutions on a broad range of valuation and advisory matters. The firm provides business valuation, asset valuation, transaction advisory, financial reporting valuation, and litigation support services across the energy industry, helping clients address complex financial and strategic questions with independent, well-supported analysis.Through its participation in the conference, Mercer Capital looks forward to contributing to discussions around valuation discipline, capital markets activity, and long-term value creation in the energy sector. Additional information about Hart Energy’s 2026 Energy Capital Conference is available on their website: Energy Capital Conference
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