(This April 7 story corrects spelling of Enverus in headline)
(Reuters) – U.S. oil and gasoline exploration and manufacturing offers rose fivefold within the first quarter over a year-ago, in accordance with consultancy Enverus, in a foreshadowing of latest blockbuster shale mergers.
Some $3.4 billion in offers had been struck within the first quarter, in contrast with $600 million a year-ago, because the coronavirus pandemic slammed the brakes on gas demand and the oil market. Deal-making has accelerated this quarter versus final 12 months as oil costs recovered, however is down from $27.8 billion within the fourth quarter of 2020.
All high 5 first-quarter offers concerned a non-public firm, in accordance with Enverus, a pattern it expects to proceed this 12 months, together with Pioneer Pure Sources Co’s buy of privately-held DoublePoint Power LLC for $6.4 billion earlier this month.
“We’re going to proceed to see exercise pattern upwards,” mentioned Andrew Dittmar, a senior analyst with Enverus.
Non-public corporations are extra prepared to make offers as public corporations divest non-core property and inventory costs rise, he mentioned.
Deal exercise slowed sharply within the second quarter of final 12 months, with simply $2.8 billion in asset gross sales and mergers, as producers grappled with traditionally low oil costs, pulled again on drilling and shut wells to keep away from losses.
The offers final quarter embody Equinor ASA’s $900 million sale of Bakken shale properties to private-equity backed Grayson Mill Power, and Ovintiv’s $880 million sale of shale properties to Validus Power.
Samson Sources additionally in March closed a sale of its Powder River Basin property to Continental Sources. That very same month Enerplus accomplished its $465 million money acquisition of Bakken shale operator Bruin E&P.