Oil and gas industry business owners are acutely aware of the volatility of global markets. The boom-to-bust cycles that define the industry underscore the importance of identifying and implementing opportunities that consistently drive value. As an oil and gas industry business owner, you can implement changes that maximize your company's value whether you're planning to sell, divest or expand.
Enhancements may include environmentally sustainable practices; asset portfolio optimization; processes that enhance production and operational efficiencies; cost-saving technologies; new growth opportunities throughout the oil and gas industry value chain; an effective HSE program; and vertical integration to streamline contractor management activities. These improvements add value to your business, making it especially appealing to highly motivated investors and buyers.
Environmental sustainability
Increased awareness of the effects of climate change and the importance of minimizing corporate carbon footprints highlights the need for ESG practices within the oil and gas industry value chain. The challenge upstream and midstream companies face is finding the right balance between maintaining optimal production and transportation processes and reducing greenhouse gas and carbon emissions.
Implementing measures to minimize or reduce methane leaks, isolate carbon seepages during the oil recovery process, and improve wastewater disposal techniques and freshwater use during exploration and production can help your company achieve both objectives.
An optimized asset portfolio
A key value driver for your oil and gas industry business is asset portfolio optimization. An effectively diversified asset portfolio helps your company withstand the volatility of the oil and gas industry's boom and bust cycles. Prospective buyers highly prize companies with optimized asset portfolios that reflect attributes such as measured natural gas growth, investment cycle resource management, modest risk-return investments, emphasis on operational excellence instead of geographical benefits, and a vigorously and strategically managed asset portfolio.
Enhanced production and operational efficiencies
Implementing processes that enhance production and operational efficiencies saves money, lowers costs and reduces waste. Advances in digital technologies streamline oil and gas company operations and production processes to eliminate redundancies.
Capital efficiency is a 12-point metric used to determine a company's ability to select, deploy and manage capital investments in a manner that maximizes value for shareholders. These elements optimize your company's value by driving efficiency, performance and growth throughout the value chain.
Cost-saving technologies
Oil and gas industry business owners who embrace the integration of cost-saving technologies and digital data usage are adding business value that increases profitability and generates investor interest. Production technologies can help optimize your company's existing assets and available resources, while digital data can improve decision-making processes and operational performance to boost efficiency and lower production costs.
New growth opportunities
Instead of restricting your oil and gas business operations to one specific industry sector, consider identifying and exploiting new growth opportunities throughout the industry value chain. Opportunities in petroleum product-related niche markets in other industry segments have the potential to unlock business value that is sustainable despite volatility in the global market.
A solid HSE program
Measures ensuring worker health, safety and well-being are a top priority for oil and gas business owners in all industry sectors. Adverse weather conditions, geographically remote work sites, hazardous materials handling, heavy equipment usage, physical demands of the job and round-the-clock operations present risks to workers.
You can implement a robust HSE program incorporating best-practice safety measures that mitigate risk by minimizing the frequency of workplace accidents and injuries.
Vertical integration
Oil and gas business owners are realizing value with vertical integration to streamline contractor management-related activities. Instead of outsourcing services and equipment procurements to third-party vendors, try to perform these services in-house to increase efficiency and reduce costs. The monies saved can be used to expand your company's offerings.
To learn how your company can benefit and best position itself within the M&A landscape, call or email me now to receive 3 hours of free consultative analysis. Our analysis offers clarity, based on your objectives, if a full or partial exit, recapitalization, divestiture, acquisition or pre-sale exit strategy provides the greatest benefit to you and your company.
Vercor has been delivering M&A expertise for over 25 years. We serve as a trusted partner to help build long term, iterative strategies that ensure you are positioned to meet your unique personal and financial goals whether it is selling, recapitalizing, acquiring or divesting of a division. Now is the time to evaluate, strengthen, prepare and increase the market value of your company regardless of your timeframe.
Todd Cummiskey
Vercor
704-926-6564
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