Pickering Energy Partners (PEP) announced the launch of a financial advisory unit for oil and gas dealmaking, signaling a renewed commitment to traditional fossil fuels. This move comes as some banks are scaling back their involvement in the oil and gas sector while increasing investments in clean energy.
The establishment of this investment banking unit marks a comeback for Dan Pickering, an experienced energy financier who played a pivotal role in founding Tudor, Pickering, Holt & Co, an energy boutique bank that Perella Weinberg Partners (PWP.O) acquired in 2016.
Heading this new seven-member unit are former Barclays Plc (BARC.L) dealmakers, Jason Kivett and Robyn Underwood. Their team will provide services encompassing mergers and acquisitions advisory as well as capital markets issuance.
Pickering Energy Partners (PEP, headquartered in Houston, already operates an investment banking unit focused exclusively on the energy transition sector. The firm’s diverse offerings include equity research, investment funds, and consulting services.
$16 Billion in Capital
PEP, in its current form, emerged from Perella Weinberg in 2019, and since then, it has deployed over $16 billion in capital within the energy industry, as indicated on its website. The expiration of all non-compete agreements with Perella Weinberg now allows Pickering to reengage in oil and gas advisory services.
In recent years, some banks have sought to pivot away from the oil and gas sector, redirecting their attention toward renewable energy dealmaking. This shift is partly in response to the burgeoning green energy sector and also due to pressure from stakeholders and regulators concerned about the environmental impact of fossil fuels and their contribution to climate change.
Several banks, including BNP Paribas (BNPP.PA), Bank of Montreal (BMO.TO), and Bank of Nova Scotia (BNS.TO), have withdrawn from oil and gas dealmaking. More recently, Credit Suisse, once a prominent player in the energy sector, closed its Houston office after being acquired by UBS Group AG (UBSG.S).
However, it’s worth noting that many traditional banks still provide advisory services to major oil and gas companies, earning substantial fees for a range of services, including mergers and acquisitions. Deal activity in the U.S. upstream sector has been robust this year, with publicly-listed producers pursuing mergers and acquisitions to expand their scale and resources.
Dan Pickering expressed optimism about the current opportunities in the energy market, emphasizing his firm’s commitment to expanding its investment banking division by doubling its headcount over the next two to four years.
