U.S. oil and gas deals hit $51 bn in first-quarter: Enverus

The size of the U.S. oil and gas deals has hit a record $51 billion during the first quarter of 2024, data provider Enverus said.Energy companies have rushed to expand oil and gas drilling inventories, especially in the Permian Basin of West Texas and New Mexico, where producer break-even costs are about $64 a barrel. Oil prices averaged about $77 a barrel last quarter and this week traded near $83 per barrel, Reuters news report said.

“Most of the high-quality U.S. drilling prospects are in the Permian. So it is unsurprising the prolific basin was yet again the primary driver for M&A within oil and gas,” said Andrew Dittmar, Enverus Intelligence Research’s principal analyst.

The biggest proposed acquisition last quarter was Diamondback Energy’s $26 billion bid for closely held Endeavor Energy Partners.Apache parent APA’s $4.5 billion deal for Permian oil rival Callon Petroleum, and natural gas Chesapeake Energy’s $7.4 billion deal for Southwestern Energy rounded out the period’s most valuable deals.

The Chesapeake acquisition and last year’s blockbuster deals by Exxon Mobil and Chevron remain stalled by antitrust reviews in part because they concentrate holdings in the Permian or Haynesville shale fields, said Dittmar.The number of deals rose to 27 last quarter, compared with 20 in the same period a year ago, and 60 percent of first quarter transactions by value were in the Permian, Enversus calculates.