Good Returns Tempt Private Equity into US Oil and Gas Sector
By: Rachael Seeley, Energy Intelligence Finance
March 28, 2012On March 28, 2012, Energy Intelligence Finance ran an online article covering information discussed at BoyarMiller’s March 22 Perspectives on the Energy Industry Breakfast Forum. The following is an excerpt from the article:
Sustained $100-plus crude prices mean parts of North America’s energy sector offer a good rate of return in the current climate, as evidenced by a spate of private equity deals over the past year. Investment bankers predict more such deals to come.
In a recent note to clients, US bank Wells Fargo noted that while not all exploration and production companies can earn an outsized rate of return, “cash flow can restrict capital from going to assets which otherwise could earn a 12%- 15% type rate of return. Given the current alternatives, not a bad option.”
“Private equity money flows to what works and energy has been working,” David Pursell, managing director of US energy-focused investment bank Tudor, Pickering & Holt (TPH) told Energy Intelligence Finance on the sidelines of a recent BoyarMiller energy breakfast forum in Houston.
To read the complete article, click here.
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