Global oil and gas industry M&A - statistics & facts
The worldwide oil and gas industry has been ramping up mergers and acquisitions (M&A) activity, with 2024 off to a hot start. The first two months of 2024 reported the highest deal value of a first quarter since 2017, following years of decline. This surge is largely thanks to transactions undertaken by United States-based companies. Being home to many of the world’s most profitable public oil and gas entities, the U.S. has dominated oil and gas mergers and acquisitions more than any other country. It regularly accounts for between 50 and 80 percent of the world’s total deal value.
While many of the more traditional M&A deals boasted a successful transaction, cross-industry deals have proven more difficult. Shareholder voting or antitrust reviews are potential hurdles to completing purchases, depending on outside parameters. Globally, the energy sector tends to see far less mergers and acquisitions activity than other industries, with the technology sector one of the most common targets.
The largest deals in recent history
ExxonMobil’s acquisition of fellow Texas-based oil and gas producer Pioneer Natural Resources was the most valuable deal between 2023 and the first months of 2024. This deal is especially noteworthy as it grants ExxonMobil access to the numerous oil and gas exploration licenses held by its target in the Permian basin, the largest oil-producing basin in the U.S. Pioneer Natural Resources was previously the company operating the most sizable acreage in the area, giving ExxonMobil the potential to become the largest shale oil and gas producer in the country. It is the fourth most valuable oil and gas industry deal since 2000, falling just short of the 70 billion U.S. dollar deals between Shell and BG Group, and Kinder Morgan’s purchase of the publicly held shares of some of its subsidiaries.Increase in deals aimed at diversification
Apart from purchases meant to strengthen existing oil and gas assets, there has also been growing interest in diversification. Oil and gas companies have demonstrated the willingness to hand out billions of dollars in a bid to widen their portfolio and prove resistant to potential climate change-related upheaval. Some of the most valuable deals were energy transition-focused deals such as the proposed acquisition of Origin Energy, an Australian electricity provider, which was ultimately cancelled, and the offering of the purchase of Ecros, a basic chemicals and electrolyzer producer.While many of the more traditional M&A deals boasted a successful transaction, cross-industry deals have proven more difficult. Shareholder voting or antitrust reviews are potential hurdles to completing purchases, depending on outside parameters. Globally, the energy sector tends to see far less mergers and acquisitions activity than other industries, with the technology sector one of the most common targets.
