By Ron Bousso
LONDON (Reuters) - Australia's top investment bank Macquarie Group (AX:MQG) has closed its London-based upstream oil and gas advisory after a sharp drop in global deal making in recent years, banking sources said on Friday.
The business, which oversaw the oil and gas production sector in Europe, Middle East and Africa, and which consisted of eight employees, was closed this week.
Three members of the upstream team will move to the Macquarie Capital's midstream oil and gas investment service under Ed Winter, which focuses on energy infrastructure such as pipelines and storage, the sources said.
A Macquarie spokeswoman declined to comment.
The upstream banking desk was led up until last May by Jon Fitzpatrick, who departed to establish advisory boutique Gneiss Energy together with other former Macquarie bankers, the sources said.
Macquarie's upstream team was a joint book runner in this week's 70 million pound share placing by UK North Sea exploration and production company Hurricane Energy (L:HUR).
Merger and acquisition activity in the sector outside the United States sharply declined following the oil price crash in mid-2014. International deals in the third quarter of 2016 reached $7 billion (£5.73 billion), the lowest level since 2008, according to consultancy 1Derrick.
Activity in the sector was nevertheless expected to pick up in the coming months amid a recovery in oil prices that narrowed the asset valuation gap between buyers and sellers.