By Ron Bousso, Shadia Nasralla and Clara Denina

LONDON, Oct 6 (Reuters)Premier Oil’s takeover by private equity-backed Chrysaor marks the end of an 86-year oil wildcatter and could herald wider consolidation provided there are willing buyers in a sector whose outlook is highly uncertain.

Leading oil and gas companies, including BP BP.L and Royal Dutch Shell RDSa.L, want to sell large parts of their portfolios to prepare for a shift towards renewable energy.

The impact of COVID-19 has also hit the hydrocarbon industry particularly hard because of its impact on demand and oil and gas prices.

Faced with ballooning debt, smaller exploration and production (E&P) companies, such as Africa-focused Tullow Oil and North Sea producer Ithaca Energy, also want to sell assets or partner with an investor.

But the pool of buyers is small.

A handful of private equity firms, such as Chrysaor, backed by Harbour Energy, and HitecVision, as well as a small number of listed companies, such as Serica Energy SQZ.L, are the most likely purchasers, analysts and multiple industry sources said.

Private equity firms see opportunities to make money by cutting costs, betting on higher oil prices in the coming years as investments shrink leading to lower output.

They put money into oil and gas fields to extend their lives, when larger companies might be reluctant to spend more on assets no longer big enough to make a difference in a major portfolio.

“The sector in general is ripe for consolidation,” Harbour CEO Linda Cook told a conference call. She is expected to become CEO of the merged Chrysaor-Premier entity.

The reverse takeover announced on Tuesday needs shareholder backing and regulatory approval.

BLUEPRINT

Premier’s takeover follows months of wrangling with its creditors, who tried to ease a $2.7 billion debt burden by

(Bloomberg) —

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Australia’s government will lay out a spending program to resuscitate a recession-hit economy and generate jobs for the hundreds of thousands of people left unemployed by the nation’s Covid-19 lockdown.

Treasurer Josh Frydenberg is expected to announce a A$220 billion ($158 billion) deficit when he hands down a delayed budget for the year ending June 2021, at 7:30 p.m. in Canberra. The shortfall will be equivalent to 11.6% of gross domestic product, according to the median estimate of surveyed economists.

Five hours earlier, the Reserve Bank of Australia delivers its October interest rate decision, and is expected to keep policy unchanged.

The government’s economic blueprint is expected to backdate to July 1 this year income tax cuts that had been set to start in July 2022, and fast track another round due to start in 2024. It also plans an investment allowance for firms as well as tax breaks for small startups, according to reports. The government has already announced A$1.5 billion to revitalize manufacturing and create jobs and A$1.2 billion to subsidize wages of new apprentices.

It also plans an expanded first-home buyer program and billions of dollars extra in infrastructure funding to state governments on the proviso they use it or lose it. A women’s economic security statement is also expected aimed at cutting the gender pay gap and getting more women into the workforce.



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Position Shift

The central bank is working in tandem with the government, keeping borrowing costs low across the economy via its bond-buying and bank-lending programs and ensuring the government can borrow as needed. Tonight’s fiscal blueprint will aim to bring down unemployment — forecast to be 8% by mid-next year and still at 7.2% in mid-2022, when an election is due.

Australia entered its first recession in