(Reuters) -Southwestern Energy Co on Thursday agreed to buy Blackstone-backed Geosouthern’s assets in the Haynesville for about $1.85 billion as it looks to expand its footprint in the shale field, which is in the vicinity of the U.S. Gulf Coast export hub.

Producers are consolidating in the U.S. shale as oil and natural gas prices recover from last year’s pandemic blow to trade at multi-year highs this month.

U.S. gas futures recently touched 12-year highs and prices have skyrocketed in Europe and Asia, where buyers are desperate to lock down supply to deal with growing needs for power.

The deal will help Southwestern in the Haynesville by adding production of about 700 million cubic feet of gas per day and expanding its exposure to the U.S. Gulf Coast export hub as global demand for gas has been booming.

The total consideration of $1.85 billion includes $1.325 billion in cash and about $525 million in Southwestern shares.

GEP Haynesville LLC is a joint venture formed by GeoSouthern Haynesville and a Woodlands, Texas-based private-equity firm.

The venture acquired land in the Louisiana portion of the Haynesville basin from Encana Corp – now known as Ovintiv Inc OVV.N – for about $850 million in 2015.

Reporting by Arathy S Nair in Bengaluru; Editing by Anil D’Silva

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