While oil M&A faces structural headwinds from volatility and digestion of prior deals, interest in natural gas M&A remains active, experts say.

Gas-focused M&A is benefiting from stable forward pricing, tighter valuation spreads, strong buyer interest both domestically and abroad and a compelling long-term demand outlook.

“The gas plays are still moving forward,” said Stephen Trauber, managing director, chairman and global head of energy and clean technology at Moelis.

Forward strip prices average around $4/MMBtu over the next 12 months; 24-month strip is approximately $4.02/MMBtu. That represents an 82% rise from the 2024 Henry Hub average of $2.19/MMBtu, per U.S. Energy Information Administration (EIA) data.

“I don’t know if it’s more active on the M&A side, but it’s easier to transact because you’ve got a better forward price,” said Dan Pickering, chief investment officer for Pickering Energy Partners (PEP).

Recent momentum for gas transactions, particularly in the Haynesville and Marcellus shale plays, have revived buyer interest across Appalachia and the Gulf Coast.

EQT Corp. announced a $1.8 billion acquisition of private Marcellus E&P Olympus Energy in April. Blackstone-backed Olympus owns 90,000 net acres in southwest Pennsylvania, adjacent to EQT’s core Marcellus portfolio. Net production averages 500 MMcf/d.

EOG announced a $5.6 billion acquisition of Encino Acquisition Partners last month. The deal, with sellers Canada Pension Plan Investment Board and Encino Energy, includes $3.5 billion in debt and $2.1 billion cash.

The deal increases EOG’s working interest in northern Utica acreage by over 20%, where Encino previously held interests.

“I think there’s more optimism around gas at this point than crude, which feels strange to say after what we’ve been used to for years,” said Andrew Dittmar, principal M&A analyst for Enverus Intelligence Research.

Haynesville hopefuls

Producers and their investors want a bigger piece of the Haynesville Shale, which benefits from its proximity to Gulf Coast LNG terminals.

The basin’s top gas producers include Expand Energy, Aethon Energy Management, Comstock Resources, TG Natural Resources, BPX Energy and GeoSouthern Energy’s GEP Haynesville II, per Enverus data.

Smaller private Haynesville operators include Trinity Operating, Sabine Oil & Gas, EXCO Resources, Paloma Natural Gas and Silver Hill Energy Partners.

The fervor for Haynesville gas is attracting unlikely new faces: Hedge fund giant Citadel made a $1.2 billion acquisition of private Haynesville E&P Paloma Natural Gas in February, Hart Energy first reported. The deal included around 60 undeveloped Haynesville locations on the Louisiana side of the basin.

The midsized operator, backed by private equity firm EnCap Investments, produced about 382 MMcf/d (gross) in 2024, according to Louisiana state production data.

The Haynesville play is further distinguished by its appeal to international buyers, with notable demand coming from Asian markets, Dittmar said.

Japanese utility firm Tokyo Gas, majority owner of U.S. operator TG Natural Resources (TGNR), has entered into the Haynesville in a big way. In April, TGNR acquired a 70% stake in Chevron’s East Texas Haynesville assets for $525 million.

Private East Texas gas producer Sabine Oil & Gas is backed by Japanese firm Osaka Gas.

“I think there’s an appetite [for Asian buyers] to do more, to get more exposure to U.S. gas assets,” Dittmar said.

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Appalachia M&A

Producers are also looking to Appalachia’s Marcellus and Utica plays for future gas supply.

Appalachia’s top public gas producers include EQT, Expand Energy, Antero Resources, Coterra Energy, Range Resources, CNX Resources, Gulfport Energy and Infinity Natural Resources.

Sizable private producers include Ascent Resources, HG Energy, PennEnergy, Northeast Natural Gas and Greylock Energy.

EQT’s acquisition of Olympus and EOG’s purchase of Encino have helped reinvigorate M&A activity in Appalachia. Last year, CNX expanded its Marcellus footprint with a $505 million acquisition of Apex Energy II. Apex was backed by private equity firm Carnelian Energy Capital.

Private equity-backed groups seeking to put recent fundraises to work could drive the next wave of Appalachian transactions, Pickering said.

“Appalachia seems to be fairly active and interesting,” he said.

However, despite Appalachia’s vast gas reserves, production growth has been limited by insufficient pipeline takeaway capacity. But that could change as the Trump administration touts plans to greenlight new pipeline projects in Appalachia—including the Constitution Pipeline, which would transport more Marcellus gas to demand centers in New England.

Appalachian producers are also excited about growing demand for gas from data centers being sited in the basin.

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Secondary gas basins

Haynesville and Appalachia remain the standout gas plays, but significant volumes also lie untapped in secondary basins across the Lower 48.

There are a few gas-focused processes active in the Oklahoma Midcontinent, Pickering and Trauber said.

After closing a $17.1 billion acquisition of Marathon Oil, ConocoPhillips continues to market Marathon’s legacy Midcontinent assets in the Anadarko Basin. Marathon’s Oklahoma assets are expected to fetch around $1 billion in a potential sale.

Producers are also drawing significant gas volumes from South Texas' Eagle Ford and Austin Chalk plays to supply the growing LNG export complex. South Texas is also drawing greater interest from international buyers from Asia and the Middle East.

Rockies plays such as the San Juan, Piceance, Uinta and Green River hold substantial gas resources but face higher breakeven costs and stringent federal oversight.

“[Secondary gas basins are] going to see interest from private capital that want to get longer term gas,” Dittmar said.

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