docFinder alert PLS PLS
Week of October 29, 2012Volume 2, No. 34

Gulf of Mexico Renaissance
Active M&A deals amid post-moratorium rebound


W&T buys $228 MM

as Newfield exits Gulf


October 4, 2012


Full Presentation



EPL buys $550 MM

from Hilcorp's shelf assets


October 3, 2012


Full Presentation


As of October 26, the Baker Hughes Federal waters Gulf of Mexico rig count stood at 48, up 45% YOY and up from a low of 12 during the bottom of the post-Macondo moratorium in July 2010.  When the Deepwater Horizon spill began on April 20, 2010, the rig count stood at 55.

This docFinder Alert highlights the renaissance in the Gulf of Mexico and a return to normal activity as sellers manage the capital demands of onshore U.S. resource plays and other global deepwater plays. Buyers, largely independents, are strengthening their existing portfolios and gaining production, reserves and additional exploratory prospects at reasonable valuations. In Q3, the Gulf of Mexico garnered the largest percentage of deal value (39%) in the United States upstream M&A markets according to PLS Global Upstream M&A database.

Earlier in the year in February, SandRidge Resources surprised the markets by buying Dynamic Resources for $1.275 billion.

More recently, on September 18, W&T Offshore bought all of Newfield Exploration's remaining Gulf of Mexico assets for $228 million.  The assets expand W&T's current production and and significant deepwater exposure with 6 producing blocks and 59 additional blocks.  W&T picks up 8.350 boepd of production (at $25,900 boepd) and 7.7 MMboe of proved reserves (at $28.05/boe).  Slide above left shows the Newfield acreage position while this slide details the deal terms.

The day before, EPL Oil & Gas paid $550 million for certain shallow water central Gulf of Mexico assets from privately-held Hilcorp.  The assets include three legacy Chevron fields in the vicinity of EPL's core fields.  EPL picked up proved reserves of 10,000 boepd ($55,000 boepd) and proved reserves of 36.3 MMboe (at $15.16 boe).   Slide above right details several key Hilcorp fields while this slide presents acquisition highlights.  The market is certainly applauding EPL's "acquire and grow" strategy in the Gulf, seeing the stock climb 39% from Jan. 1 to Sept 30. (leading U.S. focused independent performance for companies with market cap > $500 million).


More HOT slides and data below. 

Additional deals and activity regarding the Gulf of Mexico are presented below courtesy of Plains E&P, Anadarko,  Hercules Offshore, and McMoRan Oil and Gas.


Did you know?

Oil company execs, investors and bankers know full well the value of "competitive reconnaissance." PLS' new docFinder database is a valuable DATA source to help you stay current on industry and company developments.  DocFinder lets you quickly view and compare type curves, oil price differentials, drilling costs, operating costs, CAPEX plans past, present and future, and other critical data.  

Start your free trial to docFinder today!

featured.slides from docFinder

Slide Slide Slide Slide

Plains E&P

$6.1 billion GoM buy


September 10, 2012


Active Drilling

Pre-Moratorium Levels


October 2, 2012


Central Gom Shelf

Back to pre-2009 levels


October 11, 2012


Ultra Deep Shelf

LNG Exports?


October 19, 2012


In early September, Plains E&P surprised the markets with a $6.1 billion buy in the deepwater Gulf of Mexico from BP ($5.5 B) and Shell ($0.6 B).  The deals surpassed PXP's market cap and are transformational for the company.  Key assets acquired include Holstein, Marlin and Horn Mountain.  PXP increases production by 67 Mboepd (or 40%) and cash flow by over 100%.  Farther out, PXP guides to nearly 400 Mboepd by 2020, pro-forma for the transactions.

Back in July, Anadarko farmed out a 7.2% interest in its Lucius find to Inpex for $556 MM. The Gulf of Mexico remains core to APC where it holds 3 MM gross acres and garners 10% of its nearly $7 billion 2012 capex budget.  Slide above shows an active drilling program back to normal pre-Macondo levels.  APC is drilling 8 wells this year with a focus on oily Lucius look-alikes.  Anadarko's GOM "mega projects" include Caesar/Tonga, Heidelberg and Lucius.

The slide above is courtesy of Hercules Offshore - a leader in jackup services.  Shown vividly is the result of the June 2012 Central Gulf of Mexico lease sale where nearly 200 shallow water lease blocks were bought. This is a leading indicator for forward increasing demand for jackup rigs. The increased demand and higher rig utilization (89%) are driving jackup day rates up -- now above $75,000. Active Gulf of Mexico M&A activity is also increasing drilling.

McMoRan Oil and Gas has gross unrisked Shelf prospects of ~ 100 Tcfe and another ~ 30 Tcfe onshore. Given the size of the resource capture, MMR has filed with the DOE for to export LNG to FTA countries.  The slide above shows the concept of the Main Pass Energy Hub (MP block 299) which utilizes existing infrastructure and FLNG technology to commercialize the gas. MMR also sold $65 MM in conventional GOM fields and is considering further sales.

Full Presentation

Full Presentation

Full Presentation

Full Presentation

featured.transactions from PLS global M&A database

10/29/12Renegade Petroleum acquires oil assets in Saskatchewan$421 MM
10/25/12Hess divests UK North Sea Beryl area fields to Shell$525 MM
10/25/12Marathon buys 4,300 acres and 2,900 boepd in Eagle Ford$227 MM
10/23/12Tourmaline Oil buys Huron Energy in Canada$260 MM

Source: PLS M&A Database