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Posts on ‘April 19th, 2015’

‘Big Oil’ poring over troubled waters

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‘Big Oil’ poring over troubled waters

Screen Shot 2015-01-13 at 09.23.28By Mark Robinson, 17 April 2015

The severity of crude oil’s collapse meant that its effects were always likely to be felt far beyond petrol station forecourts. Reduced assumptions on future pricing convinced oil and gas majors, already given over to renewed capital discipline, to also accelerate the reduction in exploration and appraisal commitments.

The effect on valuations for oil companies and their ancillary industries has been well documented by the Investors Chronicle, but the trouble doesn’t end there. The fall-away in valuations across the wider industry has also made tertiary finance more difficult to attain for mid-tier and smaller oil companies. It also means that secondary capital issues are more expensive to complete – even for oil companies with existing production. The end result is that there are a lot of distressed energy assets up for grabs at knockdown prices. read more

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