US upstream master limited partnerships (MLP) participated in a growing percentage of oil and gas asset transactions during the last 2 years, PwC US reported as part of its latest quarterly analysis of oil and gas asset transactions.
Rick Roberge, principal in PwC’s energy merger and acquisition practice, noted “an upward trajectory with MLP deal activity” in oil and gas during 2011-12.
“While MLPs have traditionally been active in the midstream sector, we believe that there will be more activity with upstream assets as the number of upstream MLPs is increasing, and more are expected when capital markets are more receptive,” Roberge said.
PwC reported 122 US oil and transactions total for the first 9 months of 2012, and researchers said MLPs were involved in nearly 20% of those deals. That compared with MLP involvement in 15% of all US oil and gas deals during 2010, when PwC counted 186 deals total.
“Another trend that we see developing is M&A activity in the Gulf of Mexico, which has seen the highest total deal value during the third quarter that has been recorded” in more than 2 years, Roberge said. “Now that the gulf is clearly back in business for M&A, we believe oil and gas companies will increasingly look there for deal opportunities going forward.”
Overall, PwC reported 39 US oil and gas asset deals during the third quarter having values greater than $50 million, accounting for $33.7 billion total compared with 44 deals worth $41.1 billion total for the third quarter 2011.