Merger and acquisition values in the upstream oil and gas sector decreased to $US829.8 million ($A1.063 billion) last month, compared with $2.9 billion in the previous month, GlobalData's latest upstream deals review shows, but Coleman says if you really read the tea leaves there is an interesting image forming.
"As you looked at the competitor group it was clear that BG was preparing itself to do something," he said.
"It had a wonderful list of new resources, discovered, but it had a heavy capital program ahead of it over the next few years, so it was a company wondering how to develop the resources given the current cash position, and we saw them trying to free up cash through the pipeline sale in Queensland, so clearly they were trying to free up cash to develop the discovered resources in Brazil and elsewhere."
What the sale does is offer Shell more options and a technology advantage around LNG and deepwater areas.
Coleman says there are now two players who may have been active in the M&A market out of the bidding for other assets.
From looking at the international deal flow, it is obvious to many observers that one of the major drivers of the Shell/BG deal is that the major international oil companies are consistently failing to replace production despite significant capital expenditure on exploration, which is good news for the long-term oil price, but concerning in the short-term.
It means the best way to add reserves is to buy out rivals, and there is no better time to do that than at the bottom of the cycle.
The M&A wave is almost certain to break, and Coleman believes Shell and BG may not be a part of it. Indeed, they may even shake loose some non-core assets.
"It will take them out for a period of time, so what will happen in the rest of the market is interesting," he said.
"Often markets have a habit of following quickly, so someone starts and things start to move fairly quickly."
Shell, he said, had picked up some world-class assets, different from the sorts of distressed assets and companies that usually attract the tyre-kickers.
"I think a lot of people hadn't thought through it. We had. Other people were focused on poor companies with distressed assets, but the reality is world-class assets may become appropriately priced," he said.
"As we talked about with the Wheatstone acquisition you don't get world-class assets cheap, you get them at the right price, and I would argue you might see that with the BG acquisition as well."
What that means for Woodside is hard to say. The company has been on a buying spree and piling on exploration licences, and has no immediate need for assets coming into production within five years, but the company could be interested in assets that would be production-ready post-2020.
In the short term, Coleman says Shell is clearly committed to growing its LNG supply business.
Woodside has a number of advanced world-class projects, such as Sunrise and Browse, and he said there was no sign they could be lost in Shell's enlarged portfolio.
"We have already had discussions with Shell, and the discussions I have from them is that Browse is still front of mind with them.
A review of Browse has been completed, and FID is expected in 2016.
Browse's progress, which is due for a FEED decision mid-year, is very contingent on Shell's Prelude FLNG status.
Prelude, which is being commissioned in the shipyard in Korea, and the Browse FID is scheduled to coincide with the targeted first production from the FLNG project.
Woodside will benefit from Shell's actions in developing the world's first large-scale FLNG project.
"It's like the second series of the car. Generally you allow others to buy the first model of a car, let them work out the kinks, and sort out the bugs and that's what we expect out of Browse."
BG's announcement this week that it will change how it discloses financial data to reflect the importance of Brazilian and Australian assets, supporting Coleman's optimism.
