Capital access and formation in the oil and gas industry continued to be challeng­ing for even the most established players throughout 2019 and into the early months of 2020. The energy sector’s share of the S&P 500 has fallen to the lowest point in 78 years, reaching as low as 3.3% of the total S&P 500 as of March 9, 2020, down from 15% in September 2014. Equity issuances by publicly traded energy com­panies in 2019 were at their lowest volume since 2002 with $7.6 billion of equity capital raised, and upstream oil and gas companies accounted for only $0.5 billion of the total. Investors in pub­licly traded E&P equities are now focused almost exclusively on free cash flow, demanding that companies generate and grow free cash flow in a low commodity price environment and return “excess” cash flows to shareholders or use the pro­ceeds to de-lever.

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