Drama: Enterprise Bails on Williams Merger, No Longer Interested
The drama surrounding Williams and whether or not the company will sell itself continues. Energy Transfer Equity’s (ETE) billionaire CEO Kelsy Warren propositioned Williams for over six months before going public with his overtures last year (see Energy Transfer Makes “Indecent Proposal” to Buy Williams for $48B). Williams resisted, but eventually they caved and agreed to the deal, although the deal price went down by $10 billion (see Williams Accepts ETE’s “Indecent Proposal” – Price Went Down $10B). Warren claims he got snookered and got cold feet, eventually bailing (see Dead as a Doornail: ETE Terminates Merger with Williams). The ink on the flurry of lawsuits filed hadn’t even dried and Enterprise Products Partners, another huge midstream company, began making overtures to Williams (see Here We Go Again: Enterprise Products Wants to Buy Williams). That was last month. Yesterday Enterprise released a statement saying they’re finished with Williams, throwing in the towel, no longer interested. To which Williams (incredibly) replied they were “surprised” at the Enterprise announcement. Frankly, we’re surprised that Williams was surprised…
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One of the lowest cost producers that gets some of the highest prices for its natural gas in the Marcellus/Utica is Rice Energy. The difference between what it costs Rice to produce gas ($0.90/thousand cubic feet, or Mcf) verses what they sell it for (an average $3.12/Mcf) means Rice makes a whopping 247% internal rate of return, or IRR–which is THE most profitable driller among 10 of the largest Marcellus/Utica drillers surveyed (see today’s companion post on Hedging Gas Prices in the Marcellus/Utica). The Rice boys’ stellar performance has not gone unnoticed by analysts at investment and research firms. In fact, one such analyst, from Wolfe Research, says Rice “could be” a target for takeover/buyout by a larger competitor. Which competitor? Let’s name names…
Corporate raider and Carl Icahn protege Keith “Mini-Me” Meister, Managing Partner of Corvex Management, has launched a full-out assault and takeover attempt of midstream company Williams. Yesterday MDN reported that Meister has floated a slate of 10 of his own people–including himself–as candidates for the board of directors for a scheduled vote during the annual meeting later this year (see 
Just when you thought things had finally settled down with midstream giant Williams, a new rumor is making the rounds. Brief history: Energy Transfer Equity’s (ETE) billionaire CEO Kelsy Warren propositioned Williams for over six months before going public with his overtures (see 
“Everyone” thought that with low prices for oil and gas, and companies not able to turn a profit and heading into bankruptcy, that there would be a flurry of mergers and acquisitions in the oil and gas industry. “Everyone” was wrong. According to the just-released “Oil & Gas Mergers and Acquisitions Report – Mid-year 2016” from powerhouse consulting firm Deloitte (full copy below), M&A activity in the o&g industry is at its lowest point in years. The number of deals in the first half of 2016 was 198, an “extremely low” number compared to what it has been in past years. Where were the highest number of M&As? The number one shale play where deals were done was the Permian Basin–an extremely oil-rich shale layer in western Texas and southeastern New Mexico. The number two shale play where deals were done was, yep, the Marcellus Shale. Here’s the low down…
Last week U.S. Silica, one of the largest frac sand providers in the U.S., issued their second quarter 2016 update last week. Frac sand providers are a good barometer for when/if drilling is coming back. You don’t order sand unless you’re drilling wells. The company lost $12 million in 2Q16 versus losing $10 million in 2Q15. However, $1.1 million of that was due to “restructuring costs.” What about revenue? Revenue was $117 million in 2Q16 versus $147.5 million in 2Q15. So we can sum up 2Q16 as “so-so.” Not terrible, not good. With luck, 3Q16 will look better (with drilling beginning to pick up). However, in a sign that U.S. Silica believes the market will come back, they also announced last week they are buying out Sandbox Enterprises, “a leading provider of innovative logistics solutions and technology for the transportation of proppant used in hydraulic fracturing in the oil and gas industry.” That’s a sure sign they think oil and gas is coming back…
Constellation, a subsidiary company of Exelon Corporation, announced a deal yesterday with ConEdison Solutions (a subsidiary of New York’s Consolidated Edison) to buy ConEdison Solutions’ retail electricity and natural gas business. The deal means more than 560,000 commercial, industrial, public sector and residential customers across 12 Northeastern, mid-Atlantic, and Midwestern states, Texas, and the District of Columbia will become part of the Constellation family. Interestingly, ConEdison said it is selling its (regulated) electricity and natural gas business to focus on its (deregulated) renewable energy, sustainability services and energy efficiency business. Why is this Marcellus news? We see it as a potential new market for Marcellus/Utica Shale gas. Below is the announcement, along with some analysis of what’s really going (the motivation) with this deal…
In early 2015, MDN brought you the news that Shell was making a play to buy BG Group for $69.7 billion (see 
When will anti-fossil fuel madness that seems to spread like the Zika virus begin to subside? Anti-fossil fuel madness is just as destructive as Zika for those it infects. Take the case of the proposed merger/buyout of Piedmont Natural Gas by utility powerhouse Duke Energy for $6.7 billion (see 
The news is now months old that Halliburton and Baker Hughes ended their attempt to merge. The reason they called it off was because of opposition from the Obama Department of Justice (see 