OIL2020. Midstream Update - Macroeconomic Landscape and M&A Environment

After a decade of robust growth, US Onshore both production
growth and energy infrastructure buildout is moderating. Producers are likely
to allow production to decline amidst stretched balance sheets and focus on
Free Cash Flow. The rapid deceleration of drilling has occurred across shale
plays resulting in lower expected growth for midstream. From a Midstream
perspective, the industry is experiencing widespread reductions in Capex
budgets and dividend payouts. Industry structure suggests midstream assets
should consolidate, however, meaningful consolidation across the midstream
space has yet to materialize due to several factors including challenges with
relative value discussions, leverage issues and social challenges.

Learning Objectives:

• Assess the current market outlook
• Identify M&A trends
• Discover reasons why industry consolidation has yet to materialize