Author: Evaluate Energy

Oil and gas producers making deals across the green energy space

Solar, wind energy and hydrogen projects attracted significant deal interest from companies traditionally focused on upstream oil and gas in 2021 – a year that saw major upstream investment across the entire green energy space.

A new mergers and acquisitions report from Evaluate Energy shows that while wind and solar assets continued to attract greater levels of interest from E&P investors in terms of pure deal count – 56% of the 81 deals agreed – a growing number of deals were agreed in less well-established industries.

“2021 saw a greater number of emerging sectors gain traction among oil and gas players,” said Mark Young, report co-author and Senior Analyst at Evaluate Energy. “In terms of highlights away from wind and solar, we saw eight deals made relating to hydrogen production projects and six deals apiece in the electric vehicle charging and biofuels spaces.

“Investor and public pressures to diversify portfolios has led to oil and gas producers spreading into all sorts of new low-carbon technologies and innovative or renewable energy producing projects around the world.

“We would expect this trend to continue, especially with many producers recently going public with ambitious net zero targets for this decade and beyond.”

For more detail on 2021 green energy deals, as well as investments made by the most active E&P companies in green energy – such as Shell, Eni, TotalEnergies, BP and Chevron – download Evaluate Energy’s latest M&A report at the link below.

New ESG learning platform delivers vital insights for O&G leaders and teams

A new ESG learning platform is providing the skills and tools to fill a vital knowledge gap in the oil and gas industry.

Launched this week, Evaluate Energy ESG Learning offers on-demand and live courses delivered by leading experts in oil and gas. The new platform reflects a desire among employers to build ESG capability throughout their organizations. Executives and front-line staff are seeking new ‘ESG skills’ to support businesses and position them for long-term growth.

“The O&G industry has the most complicated ESG challenges of any industry,” said Bemal Mehta, Managing Director, Energy Intelligence, Evaluate Energy. “Organizations like the World Energy Council call this the Energy Trilemma: balancing energy security, energy equity and environmental sustainability. Our learning platform provides the knowledge and practical tools to address the unique ESG issues facing operators.”

Evaluate Energy ESG Learning is the first education platform designed for the O&G industry with its fit-for-purpose curriculum approach, said Mehta.

On-demand and live courses provide the knowledge to support strategic and operational ESG efforts. Foundational and advanced course options are available.​ Courses relevant to specific oil and gas geographies and regulatory environments will also be provided.

“Many companies are yet to acquire the full complement of ESG skills to navigate this dynamic and challenging environment,” said Mehta. “They will need to provide their teams with leading-edge skills and knowledge.”

Courses are developed with extensive participation and consultation with organizations leading ESG efforts.

The first on-demand course is ‘ESG Essentials’ for O&G Executives. Click here for the course summary and pricing.

Find the ideal course for you and your team here: Evaluate Energy | E-Learning

Free cash flow continues to soar for North American producers in Q3

Record levels of free cash flow continue to be generated by North America’s oil and gas producers according to a new report from Evaluate Energy that outlines how that cash is being used.

Free cash flow – the difference between operating cash flow and capex – reached a combined $19.1 billion in Q3 2021 for a study group of 84 U.S. and Canadian producers. The full report is available at this link.

“No quarter since the start of 2018 has seen a higher total operating cash flow than Q3’s $32.5 billion, while capital spending was flat from Q2 to Q3 for the study group,” said Mark Young, report author and Senior Oil & Gas Analyst at Evaluate Energy.

Four peer groups within the report are based on whether a producer has a U.S. or Canadian headquarters plus their respective oil weightings. Canada’s five oilsands majors are separated out into a fifth peer group.

“Companies treated capex priorities very differently in Q3 compared to Q2,” Young said. “Every group we examined cut capex as a percentage of operating cash flow compared to Q2.

“Ironically, in Q2 it was almost entirely the reverse – save for U.S. oil producers, every group saw capex increase as a percentage of operating cash flow compared to Q1. Debt repayments took centre stage in Q3 instead of capital spend.”

For the combined group of 84, capital spending being flat at $13.4 billion in Q3 meant capex came in at just 41% of operating cash flow.

The report also shows how far each group used extra cash flow on repaying debt and increasing shareholder returns via dividends and share repurchase plans.