Big Oil’s Wave of Buyouts Sets Up Next Leg of Energy IPO Rebound

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Energy IPOs rebound in 2025 as M&A deals and rising natural gas prices create new opportunities for investors amid industry consolidation.

By Geoffrey Morgan

(Bloomberg) – After a burst of oil and gas M&A deals, demand for new investment targets and buoyant natural-gas prices are helping drive a rebound in IPO activity in the energy industry to start 2025. The largest US crude producers have kicked off a wave of acquisitions in recent years, leaving investors with fewer places to park their cash. Exxon Mobil Corp. purchased Pioneer Natural Resources Co.; Chevron Corp. is trying to buy Hess Corp.; and ConocoPhillips acquired Marathon Oil Corp. There were also some takeouts of private energy companies, including Occidental Petroleum Corp.’s purchase of Permian Basin producer CrownRock LP.

“The energy investor has lost a ton of names in the past 18 months,” said Dan Pickering, chief investment officer at Pickering Energy Partners LP, an energy-focused investment bank in Houston. “Consolidation has made it hard for investors to find diversification and, in many cases, unique stories.” The success of recent energy-related share listings, such as Flowco Holdings Inc.’s offering, is also boosting the sector’s outlook, he said. “That all lends itself to a deal market that could continue to blossom,” Pickering said.

IPO Dearth

The flurry of M&A deals has coincided with a relative dearth of energy IPOs. Only six were completed in 2024, raising $667 million, which was the smallest amount raised since 2003. The space is seeing a nascent rebound this year thanks to listings from Flowco, Infinity Natural Resources Inc., and Venture Global Inc. The commodity price has helped — at least for natural gas, which has soared around 60% over the last year while oil prices have been flat.

“The market has a reasonable appetite for new natural gas-focused companies,” said Roth Capital Partners LLC analyst Leo Mariani. “That’s been the one trend that’s been fairly hot in the energy sector the last couple of months.” There are a few private energy companies that may be on track to debut next. Oil-field service provider HMH Holding Inc. has filed to go public. Other candidates include Aethon Energy Management.

Public markets have also been rewarding gas companies. Roth’s Mariani said “all of the strength” in key energy exchange-traded funds this year has come from natural gas-focused names. Gas-focused stocks that are gaining this year include Targa Resources Corp., EQT Corp., and Coterra Energy Inc. “There’s a perception that a window has appeared in the market,” Pickering said. “You don’t want to dawdle because the world can change.”

To contact the reporter on this story:

Geoffrey Morgan in Toronto at gmorgan66@bloomberg.net

To contact the editors responsible for this story:

Elena Popina at epopina@bloomberg.net

Mark Tannenbaum

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Big Oil’s Wave of Buyouts Sets Up Next Leg of Energy IPO Rebound

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