Oil & Gas

Q1 of 2023 saw 6 deals in the Oil & Gas sector. This was a slight decline from the previous quarter but at the upper end of what we’ve seen in recent quarters. Notable deals executed during Q1 2023 include:

• The majority sale of National Grid’s gas transmission and metering business to a consortium of asset managers, valuing the business at £7bn.
• The acquisition of Tailwind Energy by Serica Energy for £367m.

The deals activity in this sector has been influenced by:

• Clean energy – carbon capture, storage and utilisation technologies are becoming a significant area for investment within the O&G space.
• Natural gas focus – increase in natural gas investment due to environmental and geopolitical factors.

Restructuring activity in this sector remains very low. The sector performed strongly in 2022 with high global energy prices. Despite the application of ‘windfall’ taxes by various national governments, most market operators have been left with ample cash flow to fund their immediate strategies, including increased dividends and investment into green technologies. With energy prices remaining high, it’s likely companies will seek to deleverage in the coming months.