Equinor, formerly Statoil, divested their Bakken position today for ~$900 mm and brings to an end a 10 year foray into the basin, a position acquired for $4.4 billion. Ouch. With 48,000 boe/d of production and 242,000 acres... the metrics reflect what those trying to buy and sell deals already know. To get cash... prepare to have your face ripped off (assuming 0 for acreage, it’s slightly less than $19,000/boed). After Equinor’s mea culpa in October 2020, clearly they were...

This week in Technical Tuesday, I'll take "Companies that fired me for $200, Alex" as we visit the Canadian company, Enerplus, with a little help from the late, great Alex Trebek. Alex: "This acquisition was announced yesterday and grows the Enerplus position in the Bakken." Bzzzzz! DRW:  "What is their acquisition of Bruin E&P Partners?" Yes! In all seriousness, I really like the folks at Enerplus and I have a warm spot in my heart for the Bakken asset we put together in 2009...

Oh. My. Word!!! It’s #mergermonday and I couldn’t be more happy to be back.  Diamondback Energy did a twofer... QEP, the public company long seeking a mate since the rejected $8.75/share offer from Elliott at the beginning of 2019 (oh, those were the days!) and Guidon, a Blackstone backed PE company who followed the “some cash and some stock” model. This kills a lot of birds (in a humane way...). G&A reductions and other synergies save $80 mm. But equally important...

Earthstone continued the trend of consolidation today with the announcement of their acquisition of Independence Resource Management, a Warburg backed Midland basin company. Some metrics: an announced PV 10 of the PDP of $173 mm against a purchase price of $185.9 mm trailing 12 month EBITDA of $81.3 mm (but note in included 6 months pre CV prices) 4,900 acres with 70 locations having an IRR of 45% About 65% cash (~135 mm) and the rest in stock Some takeaways: ...

2020 has been surprising, to say the least.  From the wild fires in Australia to a contested election in the United States, we've seen a little bit of everything.  Who knew that investors could even rotate out of growth tech into value, as we saw in a huge way on Monday, with the super majors up 15%?!  As someone who was, and is, short the sector, days like Monday undo a huge amount of gains from an investment thesis...

Among the many things I have been working on, subtly is high on my list (sic. it has been pointed out I spelled the key phrase in this sentence incorrectly which simply underscores the fact I'm not likely to make progress on this... ever).  But, like my drinking, my dad bod, and my level of empathy for stupid people... we haven't really made a lot of progress in 2020.  But seriously, I do realize that if I want to...

Finally!  We are now progressing nicely in the consolidation phase of oil and gas companies and, although many are 18 months late, it's not insignificant that they are occurring now.  2021 budgets are almost complete and I can only imagine the faces of the management teams when the VP of Planning gave them the news.  Here's how it likely went: Planning:  "Ummmm..... we've finished all the scenarios and forecasting and forced ranking and management wedge creation.... do you, ummm, want...

I wanted the Netflix documentary "Hank" last night.  It was a great reminder of the state of things in 2008, and viewed with the perspective of COVID, bailouts, politicians and stimulus, was eerily familiar  I recommend you watch it if you find yourself home with nothing to do some time this weekend.  One of the key moments in the film was when Hank Paulson called the CEO's of the big banks together and basically said "You guys need to...

On the heels of the COP-CXO announcement, word leaked out "from sources familiar that asked not to be named" that Pioneer and Parsley were in discussions.  The two Midland based producers have a storied family history (Parsley was founded by Brian, the Chairman of Pioneer's son, and he remains as Chairman of Parsley) and a core presence in the city.  As you'd expect, therefore, there is some uproar about governance issues with approving this deal but... he/she in glass...

Last week saw some great rumors and add to the excitement as we head into #MergerMonday tomorrow.  ConocoPhillips is said to be in the final throes of negotiations with Concho, and for all the reasons outlined in the article last week, it seems likely to be announced later today. We will see, but I'm betting yes. Earlier in the week, Paul Sankey outlined the reasons that Exxon and Chevron should ultimately get married and although I don't disagree, I think...