Mergers and acquisitions in the U.S. oil and gas sector more than quadrupled last year despite softer commodity prices as energy companies boosted spending to improve efficiency and profits, according to an Ernst & Young study published on Tuesday. Companies flush with cash were focused on driving efficiency through scale, said Bruce On, partner at EY's strategy and energy transactions group. \"It’s a relook at process, tools, workforce and everything around your operations,\" On said. Leading energy companies spent $206.6 billion on mergers and acquisitions in 2024, up from $47.9 billion the previous year, according to the Ernst & Young study. Oil and gas companies cut spending on dividends and share repurchase payments by about 25% last year to $29.2 billion. Money spent on tapping oil and gas also fell slightly, with exploration and development expenditure down 7% year on year at $85.5 billion. Profits fell 10% last year to $74.8 billion, less than half the record level recorded in 2022, primarily owing to soft commodity prices, the report said. Exxon Mobil was the biggest buyer in 2024 with total property acquisition costs of $84.5 billion. The company announced the acquisition of U.S. shale oil producer Pioneer Natural Resources in October 2023 and completed the $60 billion purchase last May. The sector-wide consolidation has been led by a handful of megadeals by large players, including Exxon Mobil, Diamondback Energy and ConocoPhillips.

US oil and gas MA activity quadrupled last year, report says

Mergers and acquisitions in the U.S. oil and gas sector more than quadrupled in 2024, reaching $206.6 billion, according to an Ernst & Young study. Despite softer commodity prices, energy companies increased spending to improve operational efficiency and profits. Exxon Mobil was the largest buyer, spending $84.5 billion on property acquisitions, including the $60 billion purchase of Pioneer Natural Resources completed in May 2024. The sector saw a 25% reduction in dividend and share repurchase spending, with exploration and development expenditure down 7% year-on-year to $85.5 billion. Overall profits fell 10% to $74.8 billion in 2024, down from record levels in 2022.