Matt Landry

Oklahoma Takes the Oil and Gas Stage Today – All Ya’ll Reese Energy Consulting is going full-tilt boogie Okla., for all ya’ll this Thursday. (If you’re new to this second-person plural pronoun, Okies, Texicans, and those of us in the Midcontinent tend to use it indiscriminately with zero apologies.) Okla-City-based Chesapeake Energy has announced a company name change following this year’s $7.4 billion merger with Southwestern Energy that’s expected to close next week. The combo creates the nation’s largest natural gas producer upsetting EQT Corporation's number one position it’s held since 2017. Of all the mega merger combinations of late, Chesapeake’s name-change to now Expand Energy might be the most bittersweet for us and all ya’ll, given its beloved founder and extraordinary shale gas history. Nevertheless, time and business go on, and companies reinvent themselves to do what they do best. Meanwhile, Denver based Validus Energy has won the lottery ticket to snap up Tulsa-based Citizen Energy in a $2 billion deal, merging the two largest Mid-Con rivals with operations in Okla., Kans., Texas, and Ark. This marks the second acquisition this year by Validus, which scooped up Mid-Con assets from Continental Resources back in February for $450 million. A little backstory here: Validus in 2022 sold its Eagle Ford position to Okla. City-based Devon Energy for $1.8 billion—more than double the price Validus paid for those assets a year earlier from Ovintiv. The same year, Citizen Energy closed two deals that gave the company “a dominant Midcontinent footprint” to include 326,000 net acres, 720 operated wells, and 86 MBOED, which set it on a trajectory to become one of the top private producers in the U.S. What do you think? Learn more about REC and our natural gas expertise and consulting services at https://lnkd.in/ewhkGFa. For more information about our latest online natural gas training courses, visit us at https://lnkd.in/ggd3UkJM.

1

Big news this morning with XCL's Uinta Basin assets being acquired by SM Energy! This deal should put a spotlight on a remarkable basin: wells in the Uinta perform as well or better than the Permian or Williston. Looking at 2021 well results, XCL's wells outperform SM's by an average of 30%. Of course, the asset is still relatively early in development, but this is performance worth paying attention to. In our discussions with clients on the Uinta, we have often referred to it as a "mini-Delaware" with extreme overpressure and stacked pay, and XCL's asset covers much of the deep, overpressured window. In the press release, SM quoted potential of 17 benches (!!) for development. Last week, we coauthored a paper with XCL on Uinta Basin production drivers (from which the bottom chart is taken). For more on that, follow the link in the details of the image. #oilgas #uinta #permian

484

19 Comments

M&A chatter lately has it that inventory is scarce, the pool of potential U.S. shale targets are drying up and consolidation is slowing. But deal making may be poised to shift from the recent epicenter of M&A, the Permian Basin to the Bakken, Marcellus and elsewhere. Research firm Rystad Energy said $80 billion worth of North American assets remains on the market, with the U.S. shale sector expected to be the engine driving activity. Shale assets account for 66%, slightly more than $52 billion, of total assets on the market. Some potential deals up for grabs include Bakken-focused Grayson Mill Energy, Uinta-focused XcL Resources, Exxon Mobil's Bakken portfolio, EQT's remaining non-operated Marcellus portfolio and certain Haynesville assets from Shell and BP, Rystad said in an April 28 report. Globally, the first quarter saw the biggest dealmaking tab in five years as deal M&A value crossed the $64 billion threshold. By value, deals were up 145% compared to first-quarter 2023. The primary fuel for M&A: U.S. shale consolidation. For the remainder of the year, Rystad said the industry could see another $150 billion in M&A. “The Permian Basin has dominated recent dealmaking, but other shale plays look set to attract significant investments in the near future, with about $41 billion of non-Permian opportunities on the market,” Rystad said in an April 28 report. In some cases, deals already announced will spawn other deals. Exxon Mobil, Chevron, Occidental Petroleum and Diamondback Energy are set to make divestitures that could “invigorate short-term M&A activity,” Rystad said. With significant recent acquisitions, the companies are planning to divest non-core assets, “paving the way for growth among regional upstream players,” Rystad said. Chevron, for instance, has plans to divest approximately $10 billion to $15 billion worth of assets by 2028. Occidental’s divestiture target ranges between $4.5 billion and $6 billion. “The Permian has been the focal point for M&A activity in recent times, but that focus is waning as available assets in the basin become scarce,” said Atul Raina, vice president of upstream research at Rystad. “But with appetite still strong, deal-hungry players are looking outside the basin for acquisitions. A power shift could be on the cards, with non-Permian assets taking center stage in the future North American deals pipeline.” Outside of the U.S., deal activity has remained strong in the first quarter of 2024, with $10.5 billion changing hands at a 5% year-on-year increase, Rystad reported. Upstream majors BP, Chevron, Shell and TotalEnergies collectively accounted for $5.2 billion in deals. Rystad said demand for gas-producing resources has been high, representing about 66% of total resources bought and sold in first quarter 2024. 

73

1 Comment

Dean Foreman, Ph.D., Chief Economist, Texas Oil & Gas Association joined Grayson Brulte on The Autonomy Economy podcast to discuss key trends and geopolitical issues that are impacting the global oil and natural gas markets. Without energy, there is no economic growth. As we prepare to usher in the autonomy economy, it's important to have a clear understanding of the oil and natural gas markets as over 96% of all manufactured goods are manufactured using petrochemicals. 🎧 Listen on Apple Podcasts: https://lnkd.in/ePis7wfS 🎧 Listen/Watch on Spotify: https://lnkd.in/em7enjtt 🎥 Watch on X: https://lnkd.in/etEQhTv3 🎥 Watch on YouTube: https://lnkd.in/eN_2cubm #RoadToAutonomy #AutonomyEconomy #Energy #OilandGas #Oil #OilMarkets #EnergyMarkets #GeoPolitics #Economist #Economy

12

Time to move on, and I mean now. When your plates and coffee cups start falling off the table the public will demand change. With a 5.1 seismic activity, the plates and coffee cups are falling off the table. The industry does not have a Frac problem, a drilling problem or an air quality problem. The energy industry has a water benefical use problem. There is a distinct difference between recycling and calling it beneficial use and actual beneficial use. It is not even a disposal problem, they (midstream) is excellent at what they do. Profitably paying share holders, generating income, assuming liability for producers. Reality is, that is not enough. I can not imagine a world without oil and gas which would lead to the disruption of our agriculture system, because we can not feed our world. The green new deal is about more than solar, or wind energy and we may get there and it is no sin to try. It is a lack of good stewardship practices to continue a current disposal process without expediting treatment trains and agricultural beneficial use. In closing at the last conference (I was on a panel) I stated, I see the exit sign from here, I’ll show myself out. I stated and will restate, “I look out over this audience and I see Oxy/ Saudi Aramco/ Exxon/ EOG/Devon/and hundreds of smaller producers, but what I see is enough net worth to cure World Hunger and you expect me to believe this industry can not figure out how to treat water and put it to beneficial, use for agriculture and industrial use?” Truth is at this time the industry has not yet figured out how to own, profit, remove liability, and several other obstacles and challenges. Enter a patent process from a most unusual source. A prescriptive approach Inventor Marvin Nash Patent #11844316 Type Grant 307-287-6711 Be glad to help as you go forward with Conservation by Design. It’s the right idea at the right time!

22

10 Comments

Why is there an increased interest in drill-to-earn transactions in the Permian Basin?   Learn more in this Oil and Gas Investor article by Austin Lee and Jay Harper: https://bit.ly/3YKAeoo   #oilandgas #energy #permian

4