Oil Search, Santos on the M&A menu

OIL Search and Santos are among the global stocks which have made a recent list of potential LNG-related takeover targets in the wake of Royal Dutch Shell's $US70 billion play for BG Group.
Oil Search, Santos on the M&A menu Oil Search, Santos on the M&A menu Oil Search, Santos on the M&A menu Oil Search, Santos on the M&A menu Oil Search, Santos on the M&A menu

Bloomberg Intelligence LNG analyst William Hares said that follow-on mergers and acquisitions activity to the Shell-BG deal could focus on "smaller companies with meaningful interests in major projects or material exposure to gas near proposed sites".

Papua New Guinea petroleum and LNG producer Oil Search had the biggest market cap of the list of "small LNG fish". This was followed by Australia-listed Santos, New York-listed PNG wet gas discoverer Interoil, London-listed Tanzania and Equatorial Guinea player Ophir Energy and Western Canada-focused Painted Pony.

While Oil Search's share price strength is a deterrent, Santos has buy/outperform ratings from various brokers which believe its shares have been undervalued by debt-based concerns since last year.

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