Oil and Gas M&A Momentum Continues to Build

Deals, Mergers & Acquisitions

Matador Resources Company has announced the acquisition of Permian Basin oil and gas properties from Ameredev II Parent, LLC for $1.9 billion. This deal includes a 19% stake in Piñon Midstream and enhances Matador's existing portfolio with high-quality assets in Lea County, New Mexico, and Loving and Winkler Counties, Texas. With this acquisition, Matador's Delaware basin acreage will exceed 190,000 net acres, producing over 180,000 boed with proved reserves surpassing 580 MMboe. The acquisition is strategically important for Matador, boosting its asset base, production capabilities, and free cash flow potential. This acquisition by Matador Resources strengthens its foothold in the prolific Permian basin, particularly the Delaware sub-basin, known for its high production rates and substantial reserves. The addition of 33,500 net acres and 431 operated drilling locations enhances Matador’s operational scale and future drilling inventory. The increased production capacity and proved reserves underscore Matador's growth trajectory and market valuation, now projected to exceed $10 billion.

Noble Corp. is set to acquire Diamond Offshore Drilling in a $1.6 billion cash-and-stock deal, adding 12 offshore floaters to its fleet and expanding its total rig count to 41. This acquisition, offering an 11.4% premium on Diamond's closing share price, is expected to bolster Noble’s revenue and cash flow amidst a favorable offshore drilling market. The deal, funded through $600 million in new secured financing, promises pre-tax cost synergies of $100 million, with significant benefits anticipated within a year of closing in early 2025.

TotalEnergies has signed a 15-year agreement with Air Products for the annual supply of 70,000 tons of green hydrogen to its Northern European refineries starting in 2030. This deal, aimed at decarbonizing TotalEnergies’ refineries, will help avoid approximately 700,000 tons of CO2 emissions annually and is part of TotalEnergies' strategy to cut net greenhouse gas emissions by 40% by 2030. Additionally, TotalEnergies will provide Air Products with 150 MW of solar power from a Texas project, with plans for further renewable energy collaborations in the UK, Poland, and France.

NextDecade has signed a non-binding agreement with Saudi Aramco to supply 1.2 MTPA of LNG for 20 years from its Rio Grande LNG Facility in Texas. This deal aligns with Aramco's strategy to expand its LNG market presence, coinciding with anticipated global LNG growth of 50% by 2030. The agreement, contingent on a positive final investment decision on Train 4 expected in late 2024, is part of NextDecade's broader efforts to enhance its LNG export capabilities. 

Discovery & Development

China National Offshore Oil Corporation (CNOOC) has discovered a major hydrocarbon deposit in the ultra-shallow gas play of the ultra-deep waters in the South China Sea. The Lingshui 36-1 gas field, located at an average water depth of 1,500m, has shown a production capacity of over 10 million cubic meters per day. This discovery, described as a "major exploration breakthrough," addresses significant engineering and technical challenges and expands the resource base in the South China Sea for CNOOC. The find is pivotal for boosting natural gas reserves and production, positioning CNOOC to enhance its energy supply capabilities.

Woodside has commenced oil extraction from the offshore Sangomar field in Senegal after years of delay. The field, located 100 km south of Dakar, operates at a depth of 780 meters and has a storage capacity of 1.3 million barrels, with production expected to reach 100,000-125,000 bpd. This development is poised to significantly boost Senegal's economy, providing substantial revenue and reducing the national energy bill. Jointly owned by Woodside (82%) and Senegal's Petrosen, the project, with a first-phase cost of $4.9-$5.2 billion, marks a pivotal step in transforming Senegal’s economic landscape through its oil and gas industry. 

Sintana Energy has acquired a 49% stake in Giraffe Energy Investments, which owns a 33% interest in Petroleum Exploration License 79 (PEL 79) in Namibia’s Orange Basin. This acquisition, worth $2 million, grants Sintana access to blocks 2815 and 2915, in a region seeing increased activity from major players like BW Energy, Rhino Resources, and Shell. The National Petroleum Corporation of Namibia (NAMCOR) operates PEL 79 with a 67% interest. This move marks a strategic entry for Sintana into a promising exploration area, bolstering its presence in one of the world's emerging oil and gas frontiers.

During a recent visit to China, Pakistan’s Prime Minister and Chinese President Xi Jinping agreed to develop offshore oil and gas blocks and enhance Pakistan's mining industry. This collaboration follows Pakistan's recent gas and condensate discoveries in Sindh province, indicating a strategic move to bolster Pakistan’s diminishing domestic oil reserves, which are projected to deplete within the next decade. The deal comes amidst Pakistan's heavy reliance on imported crude oil, similar to India, and its dwindling foreign reserves. China, having already loaned Pakistan $65 billion for infrastructure projects, is expected to fund this exploration, reflecting China's continued influence and investment in Pakistan’s energy sector.

Iran's National Iranian Oil Company (NIOC) announced plans to develop the Changuleh oil field, which holds an estimated 3.2 billion barrels of oil, with a goal of producing 60,000 bpd in the first phase. Over $1.3 billion will be invested initially for drilling 18 production wells, two evaluation wells, two wastewater disposal wells, and repairing two existing wells, along with constructing necessary facilities for processing and transportation. Changuleh, located near the Azar oil field in the Anaran block and shared with Iraq’s Badra oil field, is estimated to require $2.2 billion for full development. Preparatory steps like 3D seismic tests and infrastructure construction have already been completed.