Global upstream M&A deal value surged to $20.4 billion across 30 deals in April, up from around $6 billion and 36 deals in March. North America accounted for nearly 85% of that total, or $17.3 billion, compared with roughly 14% or $862 million in March. Outside North America, activity was concentrated in South America (6%), Asia (6%), Europe (1%), and the Middle East (1%).

Dealmaking in March had been held back by uncertainty around the effectiveness of the Middle East ceasefire and a backwardated oil price curve, making it difficult for buyers and sellers to agree on valuations. Rystad Energy understands that dealmaking is now entering a new phase, with several exploration and production companies – primarily in the US shale sector – opportunistically testing buyer interest as oil prices continue to hover in the vicinity of $90-$100 per barrel.

The month's largest transaction was Shell's $16.4 billion acquisition of Montney-focused ARC Resources in Canada, the major's biggest deal since its $81.8 billion takeover of BG Group in 2015. ARC holds more than 1.5 million net acres across Alberta and British Columbia, with several areas contiguous to Shell's existing Canadian operations. Shell has guided for synergies of more than $250 million per annum, with the bulk expected from drilling and completions savings. The offer represented a 27% premium to ARC's share price on 24 April and a 20% premium to its 30-day volume-weighted average price. Other notable deals included ENEOS Xplora's $1.1 billion acquisition of a 10% stake in Malaysia LNG Tiga from Petronas, and Ecopetrol's $917 million purchase of a 26% stake in Brazil-focused Brava Energia.

The potential deal pipeline globally has risen to around $146 billion from $95 billion in March. North America accounts for nearly $76 billion – or 52% – of that total. Key contributors include Ecopetrol identifying 38 subsidiaries as potential divestment candidates, including its Permian Basin operations, Marcellus-focused Arsenal Resources being put up for sale, and Chevron considering divesting its assets offshore Canada.

Overall, while global upstream M&A activity was expected to slow in 2026, there is renewed momentum following the recent surge in the potential deal pipeline. Uncertainty around a resolution and resumption of exports through the Strait of Hormuz remains a factor requiring agility in executing deals. With several shale-focused E&Ps testing buyers’ interest in the market, North America is set to remain the primary driver in the coming period. This is also supported by mergers of equals among small- to medium-sized publicly listed producers, significant firepower among private operators, continued consolidation in the Montney, increased interest in LNG assets, and Asian producers' appetite for US shale – particularly gas.

Author:

Atul Raina
Vice President, Upstream Research
Atul.Raina@rystadenergy.com

This article draws on insights from our latest "Upstream M&A Trends report". The full analysis is available to clients via the Client Portal.