Even now, three-plus years after the start of the oil and gas industry’s biggest consolidation in a quarter century, hardly a month goes by without another major M&A announcement. Just this week, Civitas Resources said it will acquire acreage and production in the Permian from Vencer Energy for $2.1 billion. The primary drivers of these deals — many of which are valued in the billions of dollars — are clear. Among other things, E&Ps are seeking scale and the economies of scale that come with it. They also have come to believe that it makes more sense to grow production through M&A than through aggressive capital spending. And, for some producers not yet involved in the all-important Permian, acquiring even a smaller E&P there provides a foothold to build on. In today’s RBN blog, we discuss highlights from our newly released Drill Down report on the past 12 months of upstream M&A activity in the U.S. oil patch.
So far, the 2020s have been a period of almost unprecedented consolidation within the oil and gas industry. Not since the late 1990s has U.S. merger-and-acquisition activity among producers been so frenetic. Back then, a plunge in crude oil prices spurred mega-deals that helped to form many of today’s supermajors and large E&P independents: Exxon joined with Mobil, BP with Amoco and ARCO, Chevron with Texaco, Anadarko with Union Pacific and Kerr McGee, ConocoPhillips with Burlington Resources, and Devon with Mitchell Energy and Ocean Energy.
Another tsunami of M&A might have come with the oil price crash in 2014-15. After all, many producers had been massively outspending cash flow in the early years of the Shale Era to build acreage inventories in multiple unconventional plays. But the big wave didn’t happen. Instead, most E&Ps turned inward, shedding non-core assets to concentrate on core plays.
The latest M&A boom
Then came early 2020 — who in the hydrocarbons space can forget it? In just a few weeks’ time, OPEC+ collapsed, COVID lockdowns were initiated, and other factors pushed the U.S. E&P sector to the brink of insolvency. Crude oil prices had crashed to $20/bbl — one-third the level at the start of that fateful year — and producers had shifted to survival mode, slashing capex, canceling infrastructure projects, and eyeing new, more dire worst-case scenarios.
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About the song
“Bigger” was written by Beyonce, Richard Lawson, Derek Dixie, Stacy Bartha, Akil King and RAYE. It appears as the second song on the 2019 soundtrack album, The Lion King: The Gift. The song was created at a writing camp at Beyonce’s studio. It also featured in the musical film produced and directed by Beyonce, Black Is King. Released as a digital download single in July 2019, it went to #19 on the Billboard Hot R&B Songs Singles chart. Personnel on the record are: Beyonce, RAYE (vocals), Rod Castro (guitar), 10 string players (string section), and various unnamed producers and engineers (sampling, programming, synthesizers).
The album The Lion King: The Gift is the soundtrack album created by Beyonce for Disney's 2019 photorealistic computer-generated imagery remake of The Lion King, and for Black Is King. The album was recorded in 2019 at NRG Recording in North Hollywood. It was produced by Beyonce, Baby Keem, Bubele Boii, Danja, DJ Khaled, DJ Lag, Dipio, Ilya, Just Blaze, Labrinth, Sarz, Magwenzi, Moses Boyd, Nicky Davey, Northboi Oracle, P2J, Picard Brothers, Sounwave, and Tim Suby. The album featured many different artists, including Beyonce, Wizkid, RAYE, Burna Boi, Jay-Z, Pharrell Williams, Kendrick Lamar, Salatiel, and others. The album was released in July 2019 and rose to #2 on the Billboard 200 Albums chart. Three singles were released from the LP.
Beyonce (Beyonce Giselle Knowles-Carter) is an American singer, songwriter, record producer and businesswoman. She started performing at various singing and dancing competitions as a child and rose to fame professionally in the late 1990s as a member of the best-selling R&B girl group, Destiny’s Child. She released her first solo album, Dangerously in Love, in 2003. As a solo artist, she has released seven studio albums, five live albums, five EPs, three compilation albums, one soundtrack album and 83 singles, and has sold over 200 million records worldwide. She has been featured in 10 motion pictures. Beyonce has won 32 Grammy Awards and 29 MTV Music Video Awards. In 2010, she formed her own entertainment company, Parkwood Entertainment. She continues to record and tour and is currently finishing her Renaissance World Tour in support of her seventh studio album, Renaissance.
