Tullow Oil has once again been named the top UK upstream independent oil company.
This emerged today in an annual ranking of the sector by business adviser Deloitte. Tullow was first with a market value of more than £12.6billion at the end of 2011, followed by Cairn Energy on £3.7billion and Premier Oil at nearly £1.7billion. The market capitalisation of the 25 biggest companies in the sector fell from £32.2billion to £27.8billion; down 9% year-on-year.
Deloitte said Europe’s economic problems and the reduced availability of capital as a result had had a significant impact on independent oil and gas companies which need significant upfront capital to fund their developments.
As a result of the tightening in lending from banks, private-equity firms are reported to be starting to step into the funding gap, but Graeme Sheils, Deloitte’s energy partner in Aberdeen, said: “Private equity will only commit to investments where they are comfortable with the country risk and if they have confidence in the track record of the management team. That team also needs to have a clear plan to step-change oil and gas production levels over a relatively short time.”
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