After a record $192 billion in U.S. upstream consolidation last year, according to Enverus Intelligence Research, M&A activity in 2024Q1 appeared to be headed to another record with $51 billion in announced deals. But Enverus said it is “pumping the brakes on another record-setting year as deal activity slowed significantly in March, and Q2 appears to have already lost momentum.”
Analyst Andrew Dittman said Tuesday, “Deals at the start of 2024 were driven by the same factors that led to last year’s marathon of mergers – foremost among them a desire to lock up high-quality inventory when it is available. Most of that inventory is going to be found in the Permian so it is unsurprising the prolific basin was yet again the primary driver for M&A (mergers and acquisitions) within oil and gas.”
Topping consolidation in Q1 was the $26 billion sale of privately-held Endeavor Energy Resources to publicly-held Diamondback Energy. APA also expanded in the Permian with its purchase of Callon Petroleum for $4.5 billion. These two deals plus a few smaller bolt-on acquisitions gave Permian Basin a 60 percent share of total transacted upstream value.