The excitement of a discovery well on family property near Austin piqued Justin Moers’ interest in oil and gas at a young age. The test itself was a dry hole, but the young Moers was fascinated with the equipment and the rig hands.
“I think it is safe to say I was the only one that left the well site that night with a smile on my face,” he said.
That, coupled with his upbringing among the oil and gas culture of Houston, set the stage for his industry career.
Moers, managing director with Munich Re Reserve Risk Financing Inc., joined the small E&P credit business in 2015 as it was starting up and has helped lead its marketing efforts to make a name for the firm. To date, he has led structuring and execution on behalf of Munich in the successful closing of nearly $1 billion in E&P financing.
“I began my career as a public accountant for EY. After only one year as a staff auditor, I was trusted to supervise the execution of an audit involving a public oil and gas company. I was informed on my first day of employment at the firm that it generally requires three years of experience, perhaps as few as two for top performers, before one would be considered for the role.
“I believe I was given the responsibility in part due to my performance to date, but there were other contributing factors outside of my control such as the promotion of the existing engagement senior and my greater familiarity with the subject client’s business and financial reporting function relative to other members of the engagement team.”
“I joined Munich Re in 2015 to join a nucleus of individuals seeking to launch an E&P credit business. It was an entirely new initiative, and we were under a lot of pressure not only to demonstrate the program’s viability but also to deliver results. Munich Re provided us with a tremendous platform and financial support, but the rest was up to us. We started with just a few individuals and built out all the underwriting processes and methodologies and developed a go-to market strategy in what proved to be a transitional period for the industry and its traditional financing sources. There were certainly some missteps along the way, but I am very proud of what we’ve achieved to date and remain optimistic with respect to the future of the program.”
A challenging project
“In late 2019, Munich Re committed to provide financing for a Q1 2020 acquisition of the bp San Juan assets by IKAV, a European investment manager. The quantum of financing sought exceeded Munich Re’s mandated limit, so we teamed up with a Munich Re affiliate in Europe to fill out the balance. It was a multitranche note issuance with a senior tranche denominated in Euros and a junior tranche denominated in U.S. Dollars. The foreign currency considerations added a layer of complexity to nearly every aspect of the transaction.
“Munich Re’s risk management required mitigation of the currency and commodity risk inherent in the deal, which was achieved through a variety of hedging transactions. There were a few sleepless nights and moments of sincere doubt but, in the end, the parties involved came together and willed it to a close. The transaction process was one where I never could see the path to a successful closing until we got there, but it provided a tremendous learning experience and has easily been the most satisfying project of my career thus far.”
“Given the industry’s propensity for sudden change, those charged with plotting the direction of an oil and gas concern must keep a finger on the pulse of the market and be prepared to respond quickly and decisively should a change in course be warranted. It has always surprised me how many get tunnel vision when things are going well, even those that have been in the industry long enough to know better than to fall victim.”
“I would like to be a part of something that has a life beyond my career such that I can see where the next generation decides to take it.”