Mauldin and Rice on The Future of Energy

Newsletter No. 58


It is Thursday, March 21, 2024. There is a lot of oil and gas news to talk about. So, I am going to jump right into some of the highlights.

This Week’s Headlines

  • Webinar: Bullish Energy Straight Ahead
  • Saudi Aramco CEO Calls for Realism Amidst Failing Energy Transition
  • U.S. Oil and Gas Sector Records $234 Billion in M&A Spending
  • Equinor Invests $6 Billion Annually to Steady Norway’s Oil and Gas
  • Russia Plans Missile Defense for Oil and Gas Facilities
  • Savannah Energy to Acquire Stubb Creek Oil and Gas Field in Nigeria


Webinar: Bullish Energy Straight Ahead

We are in the process of conducting regular webinars on the future of energy, featuring King’s Chief Economist, John Mauldin, and Chief Growth Officer, Eric Rice. During these webinars, the two of them will discuss the future of energy and King Operating Corporation’s unique approach to developing oil and gas projects.

These webinars are designed for investors with a current net worth of $1 million (not including primary residence) or who have made $200,000 ($300,000 if filing jointly) in the last two years and expect to make the same this year. The next webinar is scheduled for April 3, 2024 at 1 p.m. CST. You can register for it here.


Proactive Measures Ensure Oil and Gas Industry Resilience

As many of you know, the Texas Panhandle recently faced dangerous wildfires, but due to meticulous preparations by operators and regulatory agencies, the oil and gas industry remained largely unaffected. Precautions such as grass mowing and weed treatment around well sites proved effective in safeguarding against fire threats. The Railroad Commission and operators worked closely to ensure community safety and minimal disruptions in production. This coordinated effort exemplifies the industry’s commitment to public safety and environmental protection in times of crisis.

Saudi Aramco CEO Calls for Realism on Future of Fossil Fuels

Amin Nasser, CEO of Saudi Aramco, delivered a stark message at the 2024 CERAWeek conference, an annual energy conference held in Houston, dismissing the notion of quickly phasing out oil and gas. Nasser highlighted the constant demand for fossil fuels and emphasized the need for a more practical approach, focusing on emissions reduction and renewable energy investments. Despite significant investments in renewables, Nasser pointed out their limited contribution to the global energy mix, suggesting a reset of transition strategies that should align more with realistic demand projections.

Oil Prices Surge to Multi-Month Highs

Oil prices climbed for the second consecutive session, reaching multi-month highs, as traders assessed the impact of Ukraine’s attacks on Russian refineries on global petroleum supplies. With at least seven refineries targeted this month alone, around 370,500 barrels per day of Russian refining capacity has been shut down, potentially leading to crude oil production cuts due to storage constraints. This disruption, combined with declining crude exports from Saudi Arabia and Iraq, alongside signs of stronger demand from China and the U.S., has bolstered oil prices. Analysts predict Brent crude to trade within an $80-90 per barrel range, with a forecast of $86 per barrel by the end of June.

U.S. Oil and Gas Sector Records $234 Billion in M&A Spending

In 2023, U.S. oil and gas companies witnessed a surge in mergers and acquisitions (M&A), spending a total of $234 billion according to the Energy Information Administration (EIA). This marked a significant rebound from previous years, driven by several multibillion-dollar transactions, including those involving industry giants like Exxon and Chevron. Analysts anticipate this consolidation trend to persist, with expectations of more mega-deals on the horizon. As a result of this activity, larger companies are emerging with increased asset ownership, potentially reshaping the landscape of the U.S. energy market.

Russia Plans Missile Defense for Oil and Gas Facilities

In the face of escalating attacks on Russian oil infrastructure, the Russian energy ministry revealed plans to defend oil and gas facilities using missile systems. Artyom Verkhov, director of the energy ministry’s gas industry development department, stated that efforts are underway to install protection systems such as Pantsir in collaboration with the Russian National Guard. This move comes in response to Ukraine’s intensified assaults targeting oil refineries, resulting in significant shutdowns affecting approximately 7% of Russia’s total oil refining capacity.


Savannah Energy to Acquire Stubb Creek Oil and Gas Field in Nigeria

Savannah Energy PLC has finalized agreements to acquire full ownership of Sinopec International Petroleum Exploration and Production Company Nigeria Limited, gaining control of the Stubb Creek oil and gas field in Akwa Ibom State, Nigeria. The acquisition, valued at $52 million for a 75% equity interest and $7.5 million for a 25% interest, is expected to be financed through a bank debt facility and existing cash resources. Savannah’s CEO, Andrew Knott, expressed commitment to growing their Nigerian operations through strategic acquisitions and organic projects, highlighting the potential value enhancement from identified upside opportunities at Stubb Creek.

If you’d like to talk to someone about King and are an accredited investor, you can fill out your information here or schedule a Zoom conversation with one of our SVPs here and someone will reach out. 

Also, please let us know how we are doing at King Operating Corporation. Leave a review here.

Recommended Reads

Equinor spends $6 billion a year to keep Norway oil, gas steady, CEO says

GlobalData Flags Oil and Gas Industry Resilience in 2023

4 oil and gas issues to watch in 2024

Thank you for your continued support, and if you have any questions for myself or any member of the King team, please don’t hesitate to reach out.

All the best,