Energy GCs: More M&A, JVs, IPOs Expected in 2014 By Mark Curriden, JD Senior Writer for The Texas Lawbook HOUSTON (January 23, 2014) Breitburn Energy Partners General Counsel Greg Brown faced an unfathomable dilemma last year when his oil and gas company decided to buy $860 million lawyer to act as local counsel because every already had too much work and were not taking any Greg Brown I never thought I would see the day when there weren t enough lawyers, I think 2014 is going to be a very active year for insatiable appetite out there for capital in the It is hard to believe that it could get any bigger Since 2009, Texas-based energy companies M&A transactions valued at $396 billion The oil and gas boom in Texas has provided the mergers, acquisitions, divestitures, joint energy companies and their investors are at The general counsel at more than a dozen major energy companies tell The Texas Lawbook they plan to spend more money for legal fees in 2014 because they expect to do more oil and gas deals It is a very good time to be an energy lawyer in Texas right now, says Stephen Coats, the general counsel at New York-based Riverstone Holdings, of energy deals in Texas and employs a lot of to new data provided to The Texas Lawbook by mergermarket, an independent global research Between 2009 and 2013, mergermarket reports there were 1,369 energy deals completed in > 1
new drilling wells, new processing plants and lots of assets that need to be developed, says Dallas-based Crosstex Energy General Counsel That means 2014 should see a lot more of the kind of deals that we ve seen over the past few Davis and other general counsel point out that every one of those companies involved in each of those transactions the buyers, sellers and In addition, Texas energy companies such as Chevron, Anadarko, Apache and Kinder Energy M&A goes way beyond the half-dozen acquisition, says Keith head of M&A and private equity at Vinson & Elkins transactions require lawyers who specialize in capital markets, tax law, environmental and regulatory law, securities Keith Fullenweider regulations, intellectual property protections, labor and employment law The more experienced law partners handling most of these energy deals now charge between simple deals or as many as 30 or 40 attorneys for It is amazing how many $900 and $1,000 an hour lawyers there are in Texas now, where the market is right now for that kind of high An analysis by The Texas Lawbook has found in Texas who spend all or most of their time and Vinson & Elkins, widely recognized as the Robin Fredrickson energy partner at Latham & Watkins in Houston, says the reputation of oil and gas lawyers has improved greatly during > 2
Just a few years ago, oil and gas lawyers were viewed by the rest of the legal profession as nothing more than dirt lawyers, > Now, everyone wants to be known as an oil and The mergermarket data shows that a handful (Kohlberg Kravitz Roberts) and Riverstone We are seeing new investors coming into the oil Latham & Watkins did the second most deals by hiring top energy and M&A lawyers away from (44 deals with a combined price tag of success during the oil and gas boom, according for example, represented Crosstex in its multi-billion dollar venture announced in Akin Gump (39 deals with a value of Porter & Hedges in Houston and Kelly Hart & an astonishing 96 major transactions valued Houston-based Enbridge Energy Partners, Houston-based Plains All American Pipeline, Dallas-based Pioneer Natural Resources, and misses many smaller oil and gas transactions as well as deals between two private energy And Thompson & Knight reports that it handled about 60 energy industry deals worth about $9 billion in 2013, but that many of those > 3
The appetite for buying assets is still there, during the past year, as some companies got a A lot of companies stepped back in 2013 and did as there s cash available, these companies are going to be looking for opportunities to grow in Chad Watt, an M&A analyst and writer with mergermarket, says that the numbers clearly large numbers of transactions from 2009 to 2012 involving upstream companies seeking to gain a Because capital during those early years was tight, ventures with nationalized energy companies Our company is always looking for good deals, says Dena Denooyer Stroh, the general counsel at Murchison Oil & Gas, which is one of those we want to double our growth of revenue and drilling just about That growth means more That is good news for Thompson & Knight, which is Stroh s primary outside counsel on transactional Dena DeNooyer Stroh Hunter White, an energy lawyer with Thompson & Knight in Houston, says Stroh is not alone among corporate general counsel predicting that upstream oil and gas companies will increase their M&A activity Those deals slowed considerably in 2013, as E&P companies re-evaluated their assets and market positions and as money became more accessible through the Mark Berg The amount of foreign interest in investments the smaller and mid-sized deals, says Mark Berg, the general counsel of Pioneer Natural In fact, Berg closed the last large international joint venture when Pioneer engineered a Berg and other energy general counsel point out that while the overall number of energy transactions remained high, there were no > 4
He and others predict that most will range from a few hundred million dollars to single digit There are a bunch of energy companies in the says David Kirkland, an energy law partner at if the stars align, that the super majors make a The biggest question is, where are commodity If crude prices soften, we might see one of the super major oil companies step out and make a Range Resources General Counsel David Poole says that M&A activity slowed in 2013 because oil and gas companies spent the year rationalizing Oil and gas M&A will almost certainly increase this year as companies dispose of those assets that are not core to their purpose and buy assets that The rationalizing of assets David Poole or focusing on core asset types is happening across the oil and gas sector, according to Kirkland, whose clients include CenterPoint Energy and a conglomerate was considered a premium, says took a break in 2013, midstream companies, including pipeline owners and service companies, While Exxon Mobil, Linn Energy and Apache headlines from 2009 to 2012, last year saw Energy Transfer Partners, Kinder Morgan Energy and Schlumberger Limited making the The midstream deals were plentiful in number, mergers or acquisitions in 2013 as there had been A growing number of midstream or pipeline companies are structured as master limited partnerships (MLPs) and an increasing number In 2013, a record 23 MLPs all in the energy The pipeline of MLP IPOs is still very full, says Ryan Maierson, a partner at Latham in low, the MLP IPO market will continue to Brown, the GC at Breitburn, says his company, about 400 possible acquisitions in 2013 and Breitburn made bids on about 20 of those and Last year exceeded our goals and our goal is to grow, says Brown of Breitburn, which has may be poor, but the legal energy sector is Please visit www.texaslawbook.net for more articles on business law in Texas.