Great American Group Sees Stability in Oil and Gas Industry, While Natural Gas Pricing Jumps
-Oil and gas output continues to increase, while natural gas pricing soars.-
WOODLAND HILLS, Calif.--(BUSINESS WIRE)--According to analysts with Great American Group, Inc. (OTCBB: GAMR), a leading provider of asset disposition, valuation, and advisory services, the oil and gas industry has experienced relative stability over the last quarter. Oil production has increased steadily, and natural gas pricing has risen drastically in the wake of a strong winter.
“Natural gas prices have experienced a sharp increase in recent weeks as demand has spiked and drained domestic storage levels”
“Natural gas prices have experienced a sharp increase in recent weeks as demand has spiked and drained domestic storage levels,” said Robert Callaway, Head of Great American Group’s Advisory and Valuations Services Oil and Gas division. “Recent colder-than-expected weather throughout most of the U.S. has driven this demand.”
Additionally, crude oil output achieved a five percent year-over-year growth in spite of rig counts, which have fluctuated little in recent months. “According to the latest U.S. Energy Information Administration estimates, oil production increased to approximately 7.5 million barrels a day by the end of 2013, with forecasts expecting 2014 to settle at nearly 8.3 million barrels a day,” indicated Callaway. The increased output is the result of horizontal drilling techniques, pad drilling, and walking rigs.
Used equipment in the secondary marketplace has remained stable through the last 12 months, with the exception of older mechanical rigs and related equipment, which have experienced an increase in secondary marketplace activity, although, at reduced recovery values. “Auction activity has remained consistent; however, most transactions of equipment have taken place in negotiated sales or through mergers and acquisitions,” said Callaway.
Continued demand for both crude oil and natural gas will dictate the necessity for the related drilling and service equipment. In the case of natural gas, while stored supply should increase after winter has subsided, the level of depletion will determine the need for increased wellheads and equipment necessary to gather this product.
Great American Group’s latest informative quarterly Oil and Gas Monitor is available on the company’s website at http://www.greatamerican.com/static/pdf/industry-insights/Oil%20and%20Gas/Oil%20and%20Gas%20Monitor%20February%202014.pdf.
For more information about asset disposition or advisory and valuation services available through Great American Group, visit www.greatamerican.com.
About Great American Group, Inc. (OTCBB: GAMR)
Great American Group is a leading provider of asset disposition and auction solutions, advisory and valuation services, capital investment, and real estate advisory services for an extensive array of companies. A trusted strategic partner at every stage of the business lifecycle, Great American Group efficiently deploys resources with sector expertise to assist companies, lenders, capital providers, private equity investors and professional service firms in maximizing the value of their assets. The company has in-depth experience within the retail, industrial, real estate, healthcare, energy and technology industries. The corporate headquarters is located in Woodland Hills, Calif. with additional offices in Atlanta, Boston, Charlotte, N.C., Chicago, Dallas, New York, Norwalk, C.T., San Francisco, London, Milan and Munich. For more information, call (818) 884-3737 or visit www.greatamerican.com.