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Oil & Gas Mergers and Acquisitions Report - Midyear 2012

An uncertain pricing outlook dampens activity


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After finishing 2011 with a rush of oil and gas merger and acquisition (M&A) activity, there has been a slowdown in deals during the first half of 2012.  Economic uncertainty and fluctuating energy prices have contributed to this decline.  The European debt crisis has resulted in lower projections of worldwide economic activity and corresponding growth in energy demand.  While at the same time, crude oil supply has increased due to expanded North American production and increases by Saudi Arabia in response to the Iran embargo.  Another driver affecting North American M&A activity has been the prolonged weakness in U.S. natural gas prices, resulting in disparity over asset valuations.  While oil and gas prices fluctuate, a resurgent North American energy market may continue to provide some interesting M&A opportunities.

Deloitte has prepared the 2012 Midyear Report, Oil & Gas Mergers and Acquisitions: An uncertain pricing outlook dampens activity, which covers deals from the past six months by sector.  The report also discusses:

  • A slowing of dry gas activity, while the Gulf of Mexico picks up
  • Continued consolidation, as companies face the challenges of a new energy landscape
  • Weak natural gas prices, a declining U.S. rig count, and lower deal activity
  • Activity overseas and interest from atypical buyers

This report reveals the insights of Deloitte M&A specialists on what is driving activity and what this says about how the business is changing.

As used in this document, ‘Deloitte’ means Deloitte LLP (and its subsidiaries). Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.

 

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