2019 was a very positive year for the Latin American upstream industry, according to analysis provided in the latest report released by Evaluate Energy, the Daily Oil Bulletin and Sproule.
Drilling activity and M&A transactions laid some important foundations for the future.
Data in the report shows that 2019 saw record overall M&A spending ($10.7 billion) compared to any other year since 2014, with Brazil, Suriname and Peru, in particular, seeing important transactions take place.
Source: Latin America M&A and Drilling Review, 2019 – Download Here.
“I believe that eventually we will look back at 2019 as a very important year in the history of the developing Latin American oil and gas industry,” said Jorge Milanese, Sproule’s Regional Director for Latin America and co-author of this new report.
“We saw a number of key discoveries made across the region after widespread pioneering drilling work, significant M&A transactions being made and plenty of other, related preparation work for what we expect to be a busy future ahead, once the industry resets post-pandemic.”
On the M&A front, Milanese was especially encouraged by activity taking place that involved companies that are not major IOCs or state-owned enterprises.
“2019 offered opportunities for smaller companies to gain access into key Latin American upstream markets,” he said. “Colombia continues to innovate as Latin America’s poster child for attracting foreign investment with pioneering bidding round ideas and close collaboration with the upstream industry.”
“Meanwhile in Brazil, an interesting dynamic is developing that is opening up possibilities for smaller companies. Typically, deepwater rounds attracted larger IOCs, but recently companies have been rationalising their portfolios. The larger IOCs are now selling assets to mid-size and domestic companies, who in turn are going through a similar process and selling their assets to even smaller companies.”
Also included in the latest Latin American M&A and Drilling Activity Review for 2019:
- Details on the largest and most significant upstream M&A activity in 2019
- Bidding round reviews and key transactional trends
- Information on future drilling and investment initiatives across the region
- Country-by-country analysis for all major producing nations
- The impact of COVID-19 and early 2020 pressures on future plans across the region