By Joshua Robbins
In 2016 there have been many challenges for companies looking at acquiring oil and gas assets. Extremely low prices in February followed by a rebound in the second quarter led to delayed deals, reevaluations and additional bankruptcies. Although the stability of the market is still in question, some companies are maintaining their focus and drive and continue to acquire. They are successful in a market that very few are closing in.
In this article, we outline a way that you can tap into these highly successful companies’ A&D strategies and begin to close the deals you want.
As I say in every article I publish, every deal is different. Our strategy is generalized and can be used as discussion points for your A&D team, or your contract divestiture organization.
I was invited to be a guest speaker at a non-profit organization in our industry about the current state of the A&D market. It wasn’t long before the Q&A started, and a consistent theme emerged: “Where can I purchase assets?” The scraps available for purchase are slim — both in physical number and in economic feasibility.
One of the teams in attendance had a very inexpensive opportunity and wanted to know my opinion on the acquisition. “It doesn’t matter what the deal price is,” I said. “What matters is your availability to capitalize on your market share, both pre-deal and post deal.”
Companies that are able to close in this market; truly successful organizations, are asking how.