Consider the Impact of Water on Your Oil Production

Jim Summers of H2O Midstream and David Finan of EIV Capital joined Weaver and East West Bank for last month’s Energy Leadership Series Breakfast in Fort Worth to discuss the impact of water on oil production. Jim focused on the water market in U.S. onshore oil and gas production, while David discussed energy lower middle market growth capital focused on midstream.

With oil and natural gas activity in the United States resulting in over 20 billion barrels of produced water annually, H2O Midstream hopes to partner with producers to provide water management solutions that lower operating costs and allow them to focus on their core business activities. Jim and his team help companies treat water as a commodity that can be used for hydraulic fracturing, agricultural use and municipal use instead of a costly waste.

David’s discussion touched on points relating to the market dynamics impacting current investment opportunities:

• Shifting regulatory environment
• Increased operating focus by E&P companies to improve returns on producing assets
• Deal flow and quality of opportunities highest since 2009/2010
• Industry-wide headcount reductions provide for experienced, top-tier executive teams along with talent at all levels
• Throughout 2015, bid-ask spreads for assets remained wide, ultimately leading to energy start-ups being favored over asset acquisitions to take advantage of market dynamics

Weaver’s Energy Leadership Series focuses on providing industry insights, as well as addressing trends and challenges in an engaging, roundtable format. Contact us to be added to our invitation list.