Africa reports $11.7b value in record $402b global oil deals in 2012 – Ernst & Young
Africa recorded $11.7 billion worth of oil transactions during the year 2012, up from $7.7 billion reported in 2011, according to Ernst & Young’s (E&Y) global oil and gas deal review published January 24, 2013.
Africa’s oil transaction volume increased from 93 in 2011 to 97 in 2012, the review indicated, describing the rise as “moderate”.
According to the E&Y, Sinopec’s $2.5 billion acquisition of Total’s 20% interest in Nigerian deepwater block OML 138, gave a significant boost to the average deal value.
The Sinopec deal was said to be the largest oil and gas transaction in Africa during 2012.
For the 2013 outlook on oil and gas in Africa, the financial firm says it expects a “greater deal flow and consistency with the 2012 regional trends”.
On the global front, oil and gas transactions recorded a staggering $402 billion in 2012, representing a 19% increase compared to 2011’s $337 billion, the review showed.
Ninety-two transactions exceeded $1 billion in value compared to just 71 in 2011, it noted, despite a marginal decrease in oil and gas transaction volumes from 1,664 deals in 2011 to 1,616 in 2012.
E&Y’s review indicated that upstream remained the most active segment with $284 billion worth of transactions accounting for 71% of total deal values while the downstream segment were flat at $42 billion, with volumes also fairly stagnant at 162 transactions (6% lower than 2011).
Andy Brogan, E &Y’s Global Leader, Oil & Gas Transaction Advisory Services said “2012 saw a continuation of trends we have seen for the last few years supported by a relatively benign oil price environment.”
Brogan attributed the increase in the number of larger deals to the “function of more capital becoming available to the right class of buyer together with increased pressure from asset and company owners to crystallize returns”.
By Ekow Quandzie
Watch E&Y’s Andy Brogan on the key findings of the Global Oil and Gas Transactions Review 2012