The number of deals completed has fallen to its lowest level in the current downturn – but some commentators say that with the number of assets coming into the market M&A activity will pick up.

UK-based Evaluate Energy said global upstream oil and gas M&A reached just $US18.5 billion ($A24.6 billion) in the first three months of 2016, of which just $5.6 billion worth of transactions took place outside the US.

Excluding licensing rounds, just 157 deals were concluded, 11% fewer than early 2015.

Low commodity prices are continuing to cause a lack of confidence in the M&A market, but with oil prices increasing in recent weeks – WTI averaged US$4.20 higher in March than in February 2016 – Evaluate says activity may pick up towards the middle of the year,

The firm said the deal totals would have been lower than the anaemic total, if not for three deals that accounted for around $10 billion.

Dominion Resources spent $6 billion to takeover Questar Corporation and Rosneft sold asset two assets in Siberia to a group of Indian E&P players: ONGC Videsh, Oil India, Indian Oil Corporation and Bharat Petroleum purchased combined 34.9% interest in Vankorneft for $2.9 billion and Oil India, Indian Oil Corp and Bharat bought a combined 29.9% stake in an eastern Siberian project for $1.12 billion.

The Dominion-Questar deal was the biggest of the quarter, seeing electricity and natural gas provider Dominion buy its rival.

Dominion sold out of the upstream space in 2013, so the Questar upstream assets, which 30,000 barrels of oil equivalent in 2015, primarily gas, may not be a good fit.

Dominion only wanted the gas distribution, pipeline, storage and supply sectors of Questar, although Questar’s upstream assets are 98% developed, and it may prefer to maintain them in harvest mode until the US gas markets improve, and in the meantime be less reliant on third party gas purchases.

ENN’s Purchase of Hony Capital’s interest in Santos, at $750 million, was the sixth biggest deal of the quarter, behind the Rosneft deals, Statoil’s $995 million purchase of a 11.93% stake in Lundin Petroleum, and Terra Energy Partners’ purchase of WPX Energy’s Rocky Mountain business ($950 million).

The takeover of 11.7% in Santos, by snapping up Hony’s interest, was apparently planned from before the time Hony bailed out Santos last year.

ENN, which is set to become a Chinese gas importer later this decade once the three million tonne per annum Zhoushan terminal is complete, is now Santos’ largest shareholder.

ENN’s goal is to become more integrated into the full natural gas supply chain and Santos provides the group with its first set of E&P assets and interests in three LNG export projects.

“The $750 million deal represents an outlay of around $43,000 per flowing barrel for the Chinese company to enter the E&P sector, which is not at all unreasonable for gas-weighted assets,” Evaluate said.

“Becoming the largest stakeholder in Santos could prove vital for the group’s LNG import endeavours to be successful, as Santos is a significant player in the Asia Pacific LNG export space.”

Combined, Santos has around 3.6MMtpa of net LNG export capacity from Gladstone LNG, PNG LNG and Darwin LNG.

“The acquisition of the 11.7% stake could therefore be mutually beneficial, in that Santos now has more of a guaranteed export market to work with, while ENN can benefit from the lower costs involved with owning a portion of its gas supplier,” Evaluate said.

Rounding out the top 10 was Chinese consortium Geo-Jade Petroleum Corporation buying Albian oiler Bankers Petroleum ($488 million), Covey Park Energy buying Haynesville and Bossier shale assets in Louisiana from EP Energy Corporation ($420 million), FourPoint Energy acquiring Chesapeake Energy's remaining Western Anadarko Basin oil and gas assets ($385 million), and Concho Resources buying 12,000 net acres complementary to the company’s core prospect in Texas from an unspecified seller for $360 million.

Private equity was busy during the past quarter as well, buying $513 million in total assets from Chesapeake, Concho Resources sold 14,000 Permian Basin acres in Texas for $290 million, Vanguard Natural Resources unloaded its Oklahoma SCOOP/STACK area assets for $280 million, Quicksilver Resources sold Barnett Shale and Delaware Basin assets for $245 million, Australia’s AWE sold out of the Sugarloaf Eagle Ford Shale project for $199 million, Rex Energy farmed-down some Appalachian Basin assets for $175 million and ConocoPhillips sold off a one-third interest in an Alaskan project for $152 million.

In all private equity bought $1.84 billion in assets.