Asia-Pacific witnessed more than 60 deals with Australia accounting for about 14 per cent of this deal volume, Bose said.

Total oil and gas industry deals for Q2 2020 worth $28.01 billion were announced globally, according to GlobalData’s deals database.

The value marked an increase of 106.2 per cent over the previous quarter and a drop of 68.1 per cent when compared with the last four-quarter average of $87.85 billion.

In terms of number of deals, the sector saw a drop of 30.5 per cent over the last four-quarter average with 405 deals against the average of 583 deals.

Lead Analyst at GlobalData, Aurojyoti Bose, noted the drop could be attributed to the COVID-19 outbreak as well as declining oil prices with concerns around oversupply.

In value terms, Middle East and Africa led the activity with deals worth $11.29 billion.

“The region topped on the back some big-ticket deals such as Abu Dhabi National Oil Company’s sale of 49 per cent stake in ADNOC Gas Pipelines to consortium of investors for US$10.1 billion,” commented Bose.

The top five oil and gas deals accounted for 63.6 per cent of the overall value during Q2 2020.

The combined value of the top five oil and gas deals stood at $17.83 billion, against the overall value of $28.01 billion recorded for the month.

The top five deals and their transaction highlights are as below: 

 

1. Adnoc completes sale of 49 per cent stake in ADNOC Gas Pipelines to consortium of investors for US$10.1 billion

 Transaction Highlights:

• The transaction allows the consortium of investors to strengthen their global presence in an area that is significant to the energy industry.
• The transaction is consistent with Brookfield’s strategy to invest in high-quality essential assets.
• The transaction represents an important opportunity for Snam as it provides the company with future collaborations in the energy transition in the Gulf area.
• The transaction underscores GIP’s strategy of investing in high-quality infrastructure assets and developing long term strategic partnerships with industry leaders.

 

2. BP to sell petrochemicals business to INEOS for US$5 billion

Transaction Highlights:

• The acquisition strengthens INEOS’ position in the petrochemicals business by providing it with an opportunity to expand and integrate its existing business.
• The sale in line with BP’s strategy to reinvent itself and to meet its $15 billion target of divestments.
• The transaction marks an end to BP’s significant move of focusing on energy transition.

 

3. CenterPoint Energy receives equity commitment of US$1.4 billion 

Transaction Highlights:

• The transaction allows CenterPoint Energy to de-leverage its balance sheet and fortify its credit profile.
• The investment addresses CenterPoint Energy’s capital needs for the coming years, thereby eliminating the anticipated equity needs through 2022.
• The transaction facilitates CenterPoint Energy to execute its five-year $13 billion capital investment program which focuses entirely on its regulated utility businesses.

 

4. The $750 million private equity deal with DoublePoint Energy by Apollo Global Management, Double Eagle Energy Holdings, FourPoint Energy, Magnetar Capital and Quantum Energy Partners.

Transaction Highlights:

• The equity commitment will boost DoublePoint Energy to continue to pursue high-quality opportunities in the Permian Basin through the acquisition of assets that may include acreage, royalties and water or pipeline infrastructure.
• The equity commitment will allow DoublePoint Energy to go aggressive in the down market.

 

5. Total’s asset transaction with Tullow Uganda and Tullow Uganda Operations for $575 million.

Transaction Highlights:

• Tullow Oil will use the proceeds from the sale to reduce net debt and strengthen the financial position, which will allow it to move towards a more conservative capital structure.
• The transaction will enable Tullow to realize value from the Lake Albert Development Project in Uganda, following the expiry of its previous farm-down agreement with Total and CNOOC announced in August 2019.
• The acquisition will enable Total along with its partner CNOOC to move the project forward toward FID and reduce g costs down to deliver a robust long-term project.
• The transaction is a part of Total’s inline strategy of acquiring long-term resources at low cost.

 

Bose concluded: “COVID-19 outbreak is adding further woes for the oil and gas industry, which is already plagued by oversupply and declining prices. This is expected to affect the completion of some of the announced and planned deals. Completion of some of these deals is likely to be delayed, while some may be called off.”