Mergers and acquisitions landscape in the oil and gas sector: challenges and best practices for integrating clean energy assets

Abstract

At a time when productivity and unit costs are at the forefront of executives’ agenda, mergers and acquisitions (M&A) are a key focus, with USD 51 billion in deals completed globally in Q1 2024, continuing a similar trend from 2023. Australian oil and gas companies are equally active with nine M&A deals announced in the first quarter of 2024, totalling USD 2.2 billion. The M&A landscape is changing, with increasing focus on clean energy investments. The oil and gas industry has experienced mixed success from M&A, and the complexity of adding clean energy assets to the portfolio further threatens the attainment of targeted value from the deal. Effective M&A integration is crucial for realising the full potential of these transactions. This abstract examines the key challenges and opportunities associated with integrating clean energy assets into traditional oil and gas portfolios. It will further identify best practices for successful integration, focussing on strategic alignment, cultural integration, value creation, and effective leadership. These practices are essential for maximising deal value and achieving both financial and environmental objectives in this evolving energy landscape.