Why the Haynesville Has an A&D Problem (and the Market is to Blame)

A&D, particularly in the Haynesville, is in a bind.

Partly, that’s the fault of a suddenly giddy natural gas price environment that has blown in gale force headwinds for deal makers.

Despite high gas prices, A&D has been left in the lurch, particularly in the Haynesville where the gas-rich shale will play a central role in the U.S. LNG, provided operators have the inventory they need.

With A&D hampered by a wide bid-ask spread, market factors may instead push companies toward more mergers or deals featuring stock-heavy consideration. And public companies are gravitating toward deals as they look to build runway—with the added danger of being hard-pressed to pay strip value for what they need.