This group brings together those who are interested in topics around oil and gas exploration, drilling, refining, and processing.

Tariq Siddiqui's picture
COO Upstream EP Advisors LLC

Oil & Energy | Business Development | Capital Projects | Offshore Wind -  Proven leader in offshore development and operations, with 25+ years’ expertise in managing business through cycles...

  • Member since 2021
  • 136 items added with 95,004 views
  • Jan 27, 2022

The recent shortages in supply and surge in oil prices have brought an upsurge in M&A deals and consolidation in Upstream Sector

Upstream Consolidation - What Are the Emerging Trends ?

There are five emerging themes seen in 2021:

  1. The shear strength in in rebound of M&A 
  2. The deal making has become global, even though hotbed is USA
  3. The energy transition is emerging as a dominant driver, manifesting in different ways.  The bigger IOCs’ strategy is to decarbonise, diversify and divest.  Private equity, among others, has continued to take advantage, scooping up unwanted assets to harvest cash flow.
  4. What we are witnessing is the tip of the iceberg of what’s coming for sector consolidation.
  • The upstream industry today is highly fragmented – there are over 2,300 companies producing less than 15,000 boe/d; and 300-plus producing more than 60,000 boe/d.
  • There will be fewer, bigger E&P companies, falling into three broad business models sustainable in a decarbonising world:
    • New Big Oil: aggregators of the larger independents
    • Adapted E&Ps: still sizeable but focused on cash-generative advantaged assets and niches
    • Super-Private E&P: delisting and absorbing publicly traded E&Ps.

              5.  Flurry of upstream IPOs in 2022 with market conditions looking favourable again


              This is a last opportunity to consolidate ; this upcycle might prove to be the last.

              Matt Chester's picture
              Matt Chester on Jan 27, 2022

              You mention the drive for these companies to decarbonize/diversify-- do you think we'll see it where for some of these the oil side of business becomes a minority and so those may avoid consolidation? Or will the companies that are part oil and part renewable end up still aggregate in the end? 

              Tariq Siddiqui's picture
              Thank Tariq for the Post!
              Energy Central contributors share their experience and insights for the benefit of other Members (like you). Please show them your appreciation by leaving a comment, 'liking' this post, or following this Member.
              More posts from this member

              Get Published - Build a Following

              The Energy Central Power Industry Network is based on one core idea - power industry professionals helping each other and advancing the industry by sharing and learning from each other.

              If you have an experience or insight to share or have learned something from a conference or seminar, your peers and colleagues on Energy Central want to hear about it. It's also easy to share a link to an article you've liked or an industry resource that you think would be helpful.

                               Learn more about posting on Energy Central »