{"id":562,"date":"2011-10-17T17:01:41","date_gmt":"2011-10-17T22:01:41","guid":{"rendered":"http:\/\/stateimpact.npr.org\/texas\/?p=562"},"modified":"2011-10-17T17:01:41","modified_gmt":"2011-10-17T22:01:41","slug":"big-oil-notices-the-small-guy","status":"publish","type":"post","link":"https:\/\/stateimpact.npr.org\/texas\/2011\/10\/17\/big-oil-notices-the-small-guy\/","title":{"rendered":"Big Oil Notices the Small Guy"},"content":{"rendered":"
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AFP \/ Getty Images<\/p>

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An Austin oil company became a small part of the Norwegian government today. Brigham Exploration<\/a>, an Austin company with about 100 employees, was purchased<\/a> by Statoil, a Norwegian energy company, for over four billion dollars cash.<\/p>\n

\u201cI think the reaction by investors is one of surprise because many did not see the company selling themselves this early,” says\u00a0Anish Patel, Managing Director of International Strategy and Investment<\/a> in New York. “A lot of the deals we\u2019ve seen to date have been more focused on natural gas — this really marks the first large scale deal for oil shale.”<\/p>\n

For Patel, today\u2019s purchase of the Austin company is part of a larger trend: big oil companies deciding to look underground instead of underwater for oil and gas. \u201cWe continue to see big oil and international oil companies coming to the onshore U.S.,” he says. “Because a lot of these shale plays you know the resource is underground, you have visibility in terms of how much resource is there, you just have to plan and effectively line up your logistics so you can capture that oil.\u201d<\/p>\n

With crude oil at over $85 a barrel, what was once uneconomic for big oil is now starting to make sense. “Technology has come along way over the last ten or fifteen years,” Patel says, “where we\u2019ve learned how to extract oil from these tight reservoirs. And a lot of that technology is around hydraulic fracturing.\u201d<\/p>\n

If the name Statoil<\/a> isn\u2019t familiar to Texans now, it will be soon. Last year the Norwegian state-controlled company paid over a billion dollars for access to the Eagle Ford Shale, a 50-mile wide band of natural gas deposits south of San Antonio. A few years back it purchased rights to offshore drilling sites off the Texas coast, which recently received approval to start exploration. And last month, the company announced a $5 million research fund for the University of Texas, which will focus on gas and oil exploration.<\/p>\n

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While Brigham Exploration had plenty of opportunity, it lacked capital. And according to Patel, today\u2019s purchase will solve that problem: \u201cWhy we think big oil is coming back is because they have the capital as well. So a company like Brigham was very investment opportunity rich, but didn\u2019t have the capital to develop its assets. With Statoil, they have the balance sheet. They can buy these opportunities, they can accelerate them, pull forward the value and make money on deals, whether it\u2019s the Eagle Ford or the Bakken<\/a>.\u201d<\/p>\n

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An Austin oil company became a small part of the Norwegian government today. Brigham Exploration, an Austin company with about 100 employees, was purchased by Statoil, a Norwegian energy company, for over four billion dollars cash. \u201cI think the reaction by investors is one of surprise because many did not see the company selling themselves […]<\/p>\n","protected":false},"author":50,"featured_media":566,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[59],"tags":[15,22,21],"acf":[],"_links":{"self":[{"href":"https:\/\/stateimpact.npr.org\/texas\/wp-json\/wp\/v2\/posts\/562"}],"collection":[{"href":"https:\/\/stateimpact.npr.org\/texas\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stateimpact.npr.org\/texas\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/texas\/wp-json\/wp\/v2\/users\/50"}],"replies":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/texas\/wp-json\/wp\/v2\/comments?post=562"}],"version-history":[{"count":9,"href":"https:\/\/stateimpact.npr.org\/texas\/wp-json\/wp\/v2\/posts\/562\/revisions"}],"predecessor-version":[{"id":572,"href":"https:\/\/stateimpact.npr.org\/texas\/wp-json\/wp\/v2\/posts\/562\/revisions\/572"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/texas\/wp-json\/wp\/v2\/media\/566"}],"wp:attachment":[{"href":"https:\/\/stateimpact.npr.org\/texas\/wp-json\/wp\/v2\/media?parent=562"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stateimpact.npr.org\/texas\/wp-json\/wp\/v2\/categories?post=562"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stateimpact.npr.org\/texas\/wp-json\/wp\/v2\/tags?post=562"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}