Global oil and gas overall deal volume and deal value was down 17.7% and 10.8% respectively in 2019, as stagnant commodity prices, disappointing results and low returns left the industry searching for capital.
This is according to the EY’s latest review of oil and gas transactions, which shows last year’s deal activity and valuations largely reflected the rebalancing of portfolios away from upstream liquids and toward gas-focused and downstream assets.
The report also says the mergers and acquisitions landscape will continue to be shaped by energy transition strategies, climate change regulations and the role of natural gas in the future energy mix.
EY global oil and gas leader Andy Brogan said: “The oil and gas deal environment continues to reflect uncertainty, as the industry redefines its role and the value of its assets in the face of the growing transition to low-carbon and no-carbon energy.
“Despite this upheaval, we see an environment in which asset attrition outruns whatever reductions there might be in demand.
“This means the industry will need to attract capital and offer returns that support continued investment.”
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