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In This List

In Play Today: NextEra looking for next target; Exxon ramps up divestment plan

Essential Energy Insights - May 14, 2020

Credit Risk: Identifying Early Warning Signals In The Oil And Gas Industry

Mining Exploration Insights - April 2020

Stress Testing Energy Companies in the Current Environment


In Play Today: NextEra looking for next target; Exxon ramps up divestment plan

S&P Global Market Intelligence presents In Play Today, a periodic summary of potential deal activity in the energy sector. This summary is based on information obtained by S&P Global Market Intelligence and may not be inclusive of all potential deal activity. Send comments and news leads to Darren.Sweeney@spglobal.com.

Power

Activist investor Elliott Management Corp. in a Jan. 21 letter urged management for Missouri utility Evergy Inc. to abandon its share repurchase plans and instead explore alternative financial paths, including a "premium stock-for-stock merger," in order to unlock up to $5 billion in new value. Guggenheim Securities LLC said NextEra Energy Inc. and Ameren Corp. "both stand out as logical suitors" if Evergy decides to pursue a strategic transaction. Exelon Corp. is seen as the "potential dark horse."

NextEra management told analysts and investors on a Jan. 24 earnings call that the Juno Beach, Fla.-headquartered utility is focusing on opportunities in the Southeast and Midwest after Florida municipal utility JEA ended its privatization efforts. The company is also looking at Federal Energy Regulatory Commission-regulated asset opportunities.

Public Service Enterprise Group Inc. in late October 2019 entered into exclusive negotiations with Denmark offshore wind developer Ørsted A/S to potentially acquire a 25% interest in the proposed 1,100-MW Ocean Offshore Wind Farm off the coast of Atlantic City, N.J.

A report emerged in October 2019 that PPL Corp. and Avangrid Inc. are considering merging all or parts of their businesses. A full merger would create a company worth more than $67 billion. Avangrid is majority-owned by Spanish utility Iberdrola SA.

Natural gas

Chevron Corp. is considering selling its stake in an Indonesian deepwater gas project in the Makassar Strait as part of the company's asset divestment plan. The California-based supermajor in December 2019 said it will evaluate strategic alternatives for natural gas assets around the world, including possibly selling them.

Exxon Mobil Corp. is reportedly considering plans to exit a deep offshore gas project in the Romanian Black Sea. The Irving, Texas-headquartered supermajor has not identified a buyer and has not reached agreements with outside groups, according to an early January report.

Independent oil and gas producer Antero Resources Corp. said in December 2019 that it plans to unload noncore lease acreage and properties and potential equity in Antero Midstream Corp. in order to shore up its credit.

Coal

Ohio coal producer Murray Energy Corp. in December 2019 filed a restructuring proposal in federal bankruptcy court that includes plans to sell the bulk of its assets and wind down the estate. Murray Energy is negotiating an asset purchase agreement with an entity formed at the direction of the company's ad hoc group of superiority lenders to serve as a stalking horse bidder for the assets.

Contura Energy Inc. is considering divesting noncore thermal coal properties as the company increases its focus on metallurgical coal, President and CEO David Stetson said in a late November 2019 interview with S&P Global Market Intelligence.

Oil

Management for Magellan Midstream Partners LP said the partnership is gearing up for its next asset sale after announcing plans to unload three marine terminals. "We are likely to sell a portion of our Saddlehorn pipeline later this year," Chairman, President and CEO Michael Mears said on a Jan. 30 earnings call. Saddlehorn, which is owned by Magellan and Plains All American Pipeline LP, can transport 190,000 barrels per day of crude oil and condensate from the DJ and Powder River basins to storage facilities in Cushing, Okla.

Exxon is reportedly looking for buyers for upstream assets in the U.K. North Sea and Germany as part of the company's plan to divest $15 billion in assets by 2021 and $25 billion by 2025. Exxon also is believed to be in early discussions to sell oil assets in Equatorial Guinea in Africa and is reportedly considering selling holdings in Australia and Malaysia. An early September 2019 report indicated the supermajor could sell its U.S. Gulf of Mexico deepwater assets to Spain's Repsol SA for about $1 billion. Meanwhile, Exxon also is among companies mentioned as having an interest in acquiring Midland Basin-focused shale driller Guidon Energy LLC.

Marathon Petroleum Corp. in late October 2019 kicked off a yearlong process to spin off its gas station and convenience store chain unit Speedway LLC. Marathon also launched a strategic review for midstream unit MPLX LP not long after activist investor Elliott Management called for the U.S. refiner to split into three independent companies.

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Updates

On Sept. 30, 2019, Sempra Energy announced it agreed to sell equity interests in its Peruvian businesses to China Yangtze Power International (Hong Kong) Co. Ltd. for $3.59 billion in cash. A couple weeks later, Sempra announced the sale of equity interests in its Chilean businesses to State Grid Corp. of China subsidiary State Grid International Development Co. Ltd. for $2.23 billion in cash.

In December 2019, Gulf Pacific Power completed its purchase of an 80% interest in a joint venture created by GE Energy Financial Services and Enel Green Power North America Inc. Reports emerged in March 2019 that General Electric Co. subsidiary GE Energy Financial Services was interested in selling its half of the venture known as EGPNA Renewable Energy Holdings LLC. Enel Green Power North America will retain a 20% ownership in the joint venture and will continue to operate the portfolio.

In October 2019, the U.S. Bankruptcy Court for the District of Delaware approved the sale of Cloud Peak Energy Inc.'s coal mines to Navajo Transitional Energy Co. LLC.

BP PLC on Jan. 7 said it agreed to divest its interests in the central U.K. North Sea and its nonoperating interests in the Royal Dutch Shell PLC-operated Shearwater oilfield to Premier Oil PLC for $625 million. In late August 2019, the oil major agreed to sell its entire business in Alaska to Hilcorp Energy Co. affiliate Hilcorp Alaska LLC for $5.6 billion.

Real estate developer Hilco Redevelopment Partners LLC affiliate HRP Philadelphia Holdings LLC has agreed to purchase Philadelphia Energy Solutions LLC's 335,000-barrel-per-day Philadelphia refinery for $240 million, federal bankruptcy court documents show.