In a new report sent to Rigzone, Enverus Intelligence Research (EIR) highlighted that U.S. upstream deals reached over $16 billion in transaction value during the third quarter of 2022.

It was “the best performance of 2022”, according to the report, which highlighted that it was achieved “despite volatility in oil and gas prices, E&P stocks still lacking market recognition and a surprising dearth of transactions. in the generally prolific Permian”.

EIR pointed to the largest transaction of the third quarter as EQT’s $5.2 billion purchase of West Virginia producer Tug Hill and associated XcL Midstream, both backed by Quantum Energy Partners. The second largest deal of the quarter saw Aera Energy, a joint venture between Shell and Exxon in California, sold to German company IKAV for nearly $4 billion, while the third largest included the acquisition of nearly 2 billion dollars from Brigham Minerals by Sitio Royalties, EIR describes.

“While the E&P business environment was generally excellent in 2022, this did not translate into a deal bonanza,” Andrew Dittmar, director of Enverus Intelligence Research, said in a company statement.

“Companies are using the cash generated by high commodity prices to pay down debt and reward shareholders rather than seek acquisitions. And when companies make offers on assets, the offers are often disappointing to potential sellers,” Dittmar added in the statement.

“To reach $16 billion in M&A value in 3Q22, it took not just a few more typical mined shale deals, but also deals like a merger of a public mining company and the largest California deal in decades. decades,” continued Dittmar.

In its second-quarter U.S. upstream M&A summary, EIR called the second quarter “a challenging quarter for deal-making as volatility rattled commodity and equity markets.” Despite this, around $12 billion was traded in upstream M&As as many private equity firms took their investments to market seeking to profit from high oil and gas prices, noted EIR in this summary.

In its first quarter summary, EIR announced that U.S. upstream M&A got off to a strong start in 2022.

“As the M&A market entered the new year, $14 billion worth of deals were announced during the first quarter of 2022,” EIR said in the first quarter report.

“The $6 billion deal in January 2022 was the largest launch in the M&A market in five years. However, the last major deal took place in early March before a spike in commodity prices n ‘temporarily suspends activity,’ the company added.

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