Both the merger & acquisition (M&A) and exploration & appraisal (E&A) drilling markets remained “sluggish” in the UK in the last three months, according to a report.
M&A activity was “tepid” in the three months between mid-February and mid-May, with only $311 million in deals done, according to market research outfit 1 Derrick.
That sum excluded, however, excludes the whopping $7.1 billion deal that saw Germany player RWE Dea sold to LetterOne Group, the Russian investment vehicle of the Alfa Group.
Farm-in deals also dropped from a historic average in the three-month period of five to four.
“Assets available in the market increased further with two farm-in opportunities announced by Sterling and Sendero during the last three months,” 1Derrick said.
“UK assets on the market are estimated at $1.5 billion $2 billion. These include Shell’s interests in Anasuria, Nelson and Sean development projects, Sumitomo’s interests in Pierce and Cook fields and Marathon’s interests in Brae Complex and Foinaven field.”
Nine exploration or appraisal wells were started in the period, with seven completed and a further seven currently in operation.
In the year-to-date, just 10 E&A wells have been spudded, as against 29 for the whole of last year and 41 the year before.
“There are 45 ready-to-drill licences, including 38 firm or decided awaiting a rig and seven in progress licences. In addition, 52 licences are planned and 249 licenses with drill or drop or contingent decisions pending.”
No field start-ups or field development plan approvals were announced in the past three months, according to 1Derrick.