Page 11 - NorthAmOil Week 10 2021
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NorthAmOil PIPELINES & TRANSPORT NorthAmOil
Chevron continues Noble consolidation
with midstream deal
US CHEVRON has struck an agreement to acquire value in support of our leading positions in the
all the outstanding shares of Noble Midstream DJ [Denver-Julesburg] and Permian basins,”
Partners that it does not already own. stated Chevron Midstream’s vice-president,
The super-major already owns a nearly 63% Colin Parfitt, who also serves as chairman of the
majority stake in Noble Midstream, which it board of directors of Noble Midstream’s general
acquired when it took over its parent company, partner.
Noble Energy, in a deal worth $4.1bn last year. Noble Midstream transports oil, natural gas
The midstream unit’s operations were integrated and water for producers in the DJ and Permian
into Chevron after that acquisition closed in basins, and Chevron is its largest customer. The
October. super-major previously talked about “efficiently
Under the new all-stock deal unveiled last combining two highly integrated businesses
week, Noble Midstream’s shareholders will while streamlining governance of the [Noble
receive 0.1393 of a Chevron share for each Midstream] assets” when it announced its initial
Noble Midstream unit they own. The transac- takeover offer for the remainder of the unit.
tion, which comprises 33.925mn Noble Mid- The original Chevron-Noble transaction
stream shares, is valued at $1.32bn and comes kicked off a wave of consolidation across the
after Chevron made a similar – but slightly US oil and gas industry as producers sought to
smaller – takeover offer around a month ago. achieve greater scale and additional efficiencies.
It is anticipated to close in the second quarter Some of the major transactions announced dur-
of this year. ing that wave have only closed in recent weeks,
“We believe this buy-in transaction is the including ConocoPhillips’ acquisition of Con-
best solution for all stakeholders, enabling us to cho Resources and Pioneer Natural Resources’
simplify the governance structure and capture takeover of Parsley Energy.
INVESTMENT
Tourmaline CEO sees more
oilpatch M&A opportunities
WESTERN TOURMALINE Oil’s CEO, Mike Rose, believes Tourmaline’s production averaged 336,325
CANADA that there are still plenty of oil and gas acquisition boepd over the fourth quarter, making a 12%
targets in Western Canada currently, but warned year-on-year increase from 299,844 boepd in the
that this could change if crude prices continue same quarter of 2019. The company says its pro-
their upward trajectory. duction has now risen to 405,000-410,000 boepd.
Indeed, Tourmaline completed four corpo- The company also posted improved earnings
rate acquisitions in 2020, and Rose said on the for the fourth quarter of 2020, at CAD629mn
company’s fourth-quarter earnings call that ($501mn), more than 10 times the CAD61.3mn
it was looking at several more potential ones, ($48.9mn) reported for the same quarter of 2019.
though this may not lead to new deals in the end. Tourmaline is Canada’s largest producer of
“There still are lots of opportunities,” Rose natural gas. It is also planning to decarbonise
said. “If oil prices continue to run and solidify, by converting its drilling and well-completion
then perhaps that pipeline of opportunity slows operations to run on gas instead of diesel. One of
down. But right now, we’re always busy evaluat- the company’s rigs is already operating entirely
ing, and we only transact on a very small propor- on electric power but, according to Rose, this
tion of the things that we look at.” would be difficult to replicate owing to the lim-
The deals Tourmaline closed last year include ited power infrastructure in many of the areas
the acquisitions of private producers Modern where Tourmaline operates.
Resources and Jupiter Resources in the fourth Given a more bullish outlook, Tourma-
quarter. These acquisitions, worth a combined line has opted to increase its dividend from
CAD526mn ($419mn) in cash and shares, CAD0.14 ($0.11) per share per quarter to
added production of 76,000 barrels of oil equiv- CAD0.16 ($0.13) per share, starting in the first
alent per day. quarter of this year.
Week 10 12•March•2021 www. NEWSBASE .com P11
