GeoSouthern, a U.S. natural gas E&P company backed by Blackstone Inc.'s credit investment arm, is exploring options that include a sale of its acreage for $2 billion, people familiar with the matter said on Sept. 8.
It would be the latest shale gas deal in the Haynesville basin following Southwestern Energy Co's $2.7 billion acquisition of Indigo Natural Resources and Chesapeake Energy Corp's proposed buy of Vine Energy Inc. earlier this year.
Energy prices have been supportive of such deal-making. U.S. natural gas futures jumped to their highest level since February 2014 on Wednesday, extending gains to more than 90% since the start of the year, on bullish demand outlook and lingering supply impact from Hurricane Ida.
The entity for sale, formally called GEP Haynesville LLC, is a joint venture between a company founded by billionaire oil man George Bishop and Blackstone's credit arm, the sources said. This venture acquired land in the Louisiana portion of the Haynesville basin from Encana Corp.—now known as Ovintiv Inc.—for about $850 million in 2015.
The sources cautioned that no deal is certain and asked not to be identified because the matter is confidential. GeoSouthern did not respond to a request for comment. Blackstone declined to comment.
GeoSouthern and Blackstone also developed 82,000 net acres in the Eagle Ford basin of South Texas and sold this joint venture to Devon Energy Corp in early 2014 for $6 billion.
Blackstone has used this year's rebound in commodity prices to sell a number of oil and gas production companies. The firm is the largest shareholder in Vine Energy, and it agreed last month to sell Permian basin oil producer Primexx Energy Partners to Callon Petroleum Co.
It was also a backer of Appalachia-focused Alta Resources, which was sold in July to EQT Corp.
Oil firms Equinor and Rosneft expect to extract some 250 million barrels of oil and 23 billion cubic meters of gas during the first part of the development of the Severo-Komsomolskoye oilfield in Russia, Equinor said on Dec. 23.
Repsol will still hold a 51% stake in the block after the deal.
The latest discovery was made by the Mako-1 well drilled about 10 km southeast of the Liza Field.