• 6 minutes WTI @ 67.50, charts show $62.50 next
  • 11 minutes Saudi Fund Wants to Take Tesla Private?
  • 17 minutes Starvation, horror in Venezuela
  • 2 hours Desperate Call or... Erdogan Says Turkey Will Boycott U.S. Electronics
  • 2 hours The EU Loses The Principles On Which It Was Built
  • 42 mins Crude Price going to $62.50
  • 6 hours Anyone Worried About the Lira Dragging EVERYTHING Else Down?
  • 11 hours Oil prices---Tug of War: Sanctions vs. Trade War
  • 11 hours Correlation does not equal causation, but they do tend to tango on occasion
  • 11 hours Russia retaliate: Our Response to U.S. Sanctions Will Be Precise And Painful
  • 6 hours Why hydrogen economics is does not work
  • 13 hours Monsanto hit by $289 Million for cancerous weedkiller
  • 19 hours WTI @ 69.33 headed for $70s - $80s end of August
  • 19 hours WSJ *still* refuses to acknowledge U.S. Shale Oil industry's horrible economics and debts
  • 17 hours Saudi Aramco IPO Seems Unlikely
  • 3 hours < sigh > $90 Oil Is A Very Real Possibility
Alt Text

Can China Afford To Slap Tariffs On U.S. Oil?

China’s latest round of tariffs…

Alt Text

Southern Company Just Raised Cost Estimates For This Megaproject Again

Southern Company's subsidiary announced yet…

Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Trending Discussions

We've Never Seen Anything Like This $5.2 Billion Energy Investment

We've Never Seen Anything Like This $5.2 Billion Energy Investment

I wrote this summer about record amounts of investment capital being raised for natural resources. And this week we got some big news about where these billions are being deployed across the energy exploration and production sector.

In Australia.

Bermuda private equity investment group Scepter Partners unveiled a takeover bid for Australian oil and gas producer Santos. Announcing it will pay a 25 percent premium to Santos' pre-takeover share price -- amounting to a total offer of $5.2 billion.

The deal is notable for a few reasons. Related: Oil Prices Still Not Low Enough To Fix The Markets

First, it's big. The $5 billion price tag makes this one of the largest buys splashed out by private equity groups in exploration and production during the current downturn in energy.

But even more interesting is the target location.

Over 90 percent of PE investment funds being raised in energy today are focused on the U.S. With big institutional investors clearly focused on the high growth potential of shale plays -- and associated energy midstream infrastructure -- in exploration locales like the Eagle Ford and the Marcellus. Related: Day Of Reckoning For U.S. Shale Will Have To Wait

But Scepter is going to the other side of the world for this energy investment. With Santos being primarily an Australian natural gas producer -- with exploration and production operations onshore, offshore, and in the growing Aussie LNG export business.

So what is energy private equity seeing in this far-afield purchase?

For one, the Australian natural gas market is strong. And it looks like proximity to Asia will make the country a winner when it comes to the current race to build new LNG capacity.

The weak Aussie dollar is also a plus. Making the investment cheaper for a U.S. dollar holder like Scepter. Related: The End Of The European Refining Boom Or Just A Pause?

A final intriguing factor is Santos' exploration holdings in Southeast Asia -- with the company having project investments in Vietnam, Papua New Guinea, Malaysia and Indonesia.

That's a region getting more and more attention. With major Spanish exploration and production firm Repsol saying earlier this month it will make Southeast Asia one of its core investment areas -- along with Brazil and the U.S. -- as it divests assets throughout the rest of the world.

Any or all of these factors could be enticing Scepter on this big buy. Whatever the case, this is a notable salvo in the dawning age of energy private equity.

Here's to energetic investment,

Dave Forest

More Top Reads From Oilprice.com:




Back to homepage

Trending Discussions


Leave a comment
  • skipperdaddy on October 25 2015 said:
    Not gonna happen
    Wont let me post link but Santos turned down the offer.

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News