During the first half of 2022, over 80GW worth of mergers, acquisitions and joint venture deals were closed by global E&Ps, which, according to Rystad Energy, is almost as much capacity added during the entire year in 2021.
As a part of Rystad’s monthly report, the research firm found that deal activity of E&Ps in the renewables sector over the period increased 21% year-on-year. May was the most active month in 2022, with 20.4GW of M&A deals and 7.3GW of joint venture agreements signed. January was the slowest month, with just 2.1GW of total deals agreed.
The 20 E&Ps that Rystad tracked inked 102.1GW of deals in 2021. The installed renewable energy capacity of these global firms totaled 93 GW by 2030 based on data available at the end of June 2022, after having kicked off the year at 76.3 GW.
As the pace of the energy transition speeds up, these E&P giants are set to continue to chase renewable energy goals, Rystad noted.
Activity was significantly higher in the second quarter of the year (Figure 1), which is in line with the pace of deal-making in the same period last year.
E&P renewables portfolios have grown remarkably, with some players even surpassing their 2030 ambitions. TotalEnergies was by far the most active E&P so far this year. The company added the largest renewable energy capacity to its portfolio during 1H 2022, with 4.9GW of joint ventures and 23GW of M&As.
Deals for capacity addition
In July, TotalEnergies secured a $34 million debt from the Arab Petroleum Investments Corp and the National Bank of Fujairah to finance the construction of a 50 MW solar portfolio.
BP followed (Figure 2) with over 16 GW of M&As agreed, and about 650MW of joint ventures.
UAE national oil company ADNOC ranked fifth on Rystad’s list of the most active E&Ps in 2022 in terms of capacity additions.
In May, ADNOC formed a strategic partnership with BP and Masdar for blue and green hydrogen developments in Teesside, England. The project is expected to kick-start the UK’s hydrogen economy at scale with the development of two 500MW hydrogen production units by 2030. The project is targeting start of operations in 2027.
