(MENAFNEditorial)
FOR IMMEDIATE RELEASE Illinois – United States – May 192015 (PR Buzz):Midstream oil and gas deals activity including capital markets and Mergers and Acquisitions (M&A) increased globally from 129 transactions in Q4 2014 to 139 in Q1 2015.
According to the Reportstack’s latest report "Quarterly Midstream Deals Review - Q1 2015" M&A accounted for 23% and 38% of the total number of midstream deals and deal value in Q1 2015 respectively with 32 transactions totalling $30.7 billion. However this value represents a 35% decrease from the $47.4 billion acquired from the same number of transactions in Q4 2014.
The Americas remained the regional frontrunner in terms of M&A and asset transactions in Q1 2015 with a total value of $31.1 billion from 38 deals.
“The midstream sector’s top deal in Q1 2015 was Energy Transfer Partners’ agreement to merge with Regency Energy Partners to form one of the industry's largest master limited partnerships. In addition to expected cost savings of more than $160 million per year the revenues generated from incremental gathering and processing volumes will help counter lower commodity prices.
“As evident in Kinder Morgan’s acquisition of Hiland last quarter access to upside from some of the Lower 48’s most resilient plays such as the Marcellus Eagle Ford and West Texas is driving deals. Capital spending and development is most sensitive to upside from improved economics through a price rebound or otherwise.”
GlobalData’s report adds that there were 20 asset transactions reported globally in the midstream sector in Q1 2015 down from 25 in Q4 2014. However the total value for these deals doubled from $1.8 billion to $3.6 billion during this period.
Similarly both capital-raising through the debt market and financing through private equity and venture capital registered significant increases in value between Q4 2014 and Q1 2015.
“Nine companies issued more than $10 billion in debt last quarter. Offerings were led by Williams with $4.5 billion followed by Energy Transfer Partners and Kinder Morgan with $3 billion and $2.5 billion respectively.
“Activity is now above Q1 2014 levels after a low in Q3 2014 prior to the oil price crash. As the tougher business environment has led to constrained cash flow capital is sought in the debt market to fund ongoing capital programs and repay other obligations.”
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