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5 Themes which will shape the Oil & Gas landscape

5 Themes which will shape the Oil & Gas landscape

According to Woods Mackenzie's corporate upstream research team assessing the challenges facing the Majors, Independents and National Oil Companies (NOCs) in 2015 -- five themes have been identified which will shape the oil & gas corporate landscape.

  1.  Financial Challenges: With commodities prices down 50% to 70% on any given week, profits will be a difficult find for many producers.
  2.  Debt Management: Many oil & gas producers find themselves in high debt situations with declining asset values, which is a correlation to the declining price of the underlying commodity; this will increase the pressure on many producers as profits diminish and increase the challenge for raising additional capital.
  3. Intense Cost Cutting: Survival of the fittest -- don’t expect to see too many companies making major investments in cost intensive projects.
  4. Mergers and Acquisitions (M&A): Distressed commodities prices could precipitate the emergence of a true buyers’ market in the energy industry. Companies which cannot cut discretionary spending required to balance the books will search for synergies and profits through M&A activities.
  5. Golden Opportunity for Long-Term Resource Capture: Exploratory plays may be challenging to find in the upcoming coming year, but previously proven resource opportunities will be a hot target for those companies which have the means to spend capital.


What does this mean for Canada’s junior oil & gas companies?” Well…. The exact same thing!

Junior companies with solid balance sheets and strong financial backers will take the opportunity over the next 12 to 18 months to acquire assets which will their support strategic direction. “We are observing a buyers’ market in Western Canada, and those with experienced management teams will seek out those who have mismanaged and hold undervalued assets. This downturn will ultimately bankrupt a lot of oil & gas companies and negatively impact investor wealth. However, for other companies and savvy investors these are wealth building opportunities. Finding companies that can exploit these current market conditions may be key to your portfolio.”, Darren Stewart, CEO 80-20 Connect.

Recent Quattro Exploration and Production News Headline:

CALGARY, ALBERTA. Jan 20, 2016. Quattro Exploration And Production Ltd. (TSXV:QXP) (“Quattro” or the “Company”) is pleased to announce the purchase of a 100% interest in oil and gas production, facilities and lands in west central Saskatchewan from an Alberta-based oil and gas exploration and production company (the “Acquisition”). The purchase price for the acquisition was $4,150,000, to be paid through the issuance of 35,000 Non-Voting, Class C, Series 3 Preferred Shares at a deemed price of $100 per share (“Preferred Shares”) and $650,000 in restricted cash, held on deposit, anticipated to be remitted to the vendor before January 31, 2016. The properties are located in the region of Superb, Saskatchewan, where production averaged 160 lbs per day in 2015.

To learn more about one of Alberta’s more active junior companies, view Quattro Exploration and Production on the 80-20 marketplace. Quattro Profile
Want to learn about other Canadian Corporations? Become an 80-20Community member and take control of your financial future.

To view the original article by Woods Mackenzie

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