EY - Financing the future energy landscape

Financing the future energy landscape

Key findings

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The oil and gas industry is experiencing major capital investment, with US$700 billion slated for projects under development. An estimated three-quarters of these ventures will cost more than US$1 billion, illustrating how today’s projects are the largest and most technically challenging ever undertaken.

Mergermarket, on behalf of EY, surveyed 100 global PE executives to better understand this transformational period in the oil and gas industry.

The main drivers of PE activity in the oil and gas industry
EY chart showing the main drivers of PE activity in the oil and gas industry

Given the current market, it’s not surprising a majority of respondents (55%) cite capital requirements as the principal driver for PE involvement in oil and gas. The availability of financing is another significant factor, with 41% of respondents rating it a prime driver.

“Compared to other sectors, PE firms find it relatively easy to raise funds for oil and gas investments whether debt or other financing — from institutional investors.”

— PE partner, US

Adding value

Contributing to and managing the deployment of growth capital can help oil and gas firms restructure and grow. According to 63% of respondents, provision of growth capital is the primary way a PE firm can add value to an oil and gas company.