Over the past 12 months, upstream consolidation deals in the oil and gas sector have reached an unprecedented $250 billion, according to a report released by Enverus Intelligence Research (EIR). This figure highlights the intense rush for consolidation and growth in America's shale patch.
The latest quarterly review from EIR reveals that mergers and acquisitions in this sector have not yet hit the trillion-dollar mark but are now being discussed as meaningful fractions of that level. The second quarter alone saw over $30 billion in new deals, led by a significant $22.5 billion merger between ConocoPhillips and Marathon Oil.
Andrew Dittmar, principal analyst at EIR, commented on this trend: "M&A momentum carried into the second quarter as pressure built on companies like ConocoPhillips, Devon Energy and SM Energy, that had previously stayed out of the market to keep pace with peers and grow in scale." He added that for companies like ConocoPhillips and Devon Energy, running out of inventory is less of a concern compared to navigating the maturing phase of shale through mergers and acquisitions.
Dittmar emphasized that this level of activity has only been reached in three previous quarters since EIR began tracking such information.