Caerus Oil and Gas LLC is exploring a sale that could value the private equity-owned natural gas producer at more than $2.5 billion, including debt, people familiar with the matter said on March 25.

The company received an acquisition offer at the end of last year and plans to launch a sale process in the coming weeks, said the sources. They cautioned that no sale is certain and spoke on condition of anonymity to discuss private information.

Caerus is owned by investment firms Oaktree Capital Management, Anschutz Investment Co. and Old Ironsides Energy. The Denver-based company owns exploration and production assets, pipelines and mineral rights, all centered on the Piceance Basin of Colorado and the Uinta Basin of Utah.

Anschutz and Old Ironsides declined comment. Caerus and Oaktree did not respond to comment requests.

U.S. natural gas futures were trading around $5.45 per million British thermal units on March 25, up over 45% this year, as Russia’s invasion of Ukraine stoked global energy supply concerns. Crude prices are also at multiyear highs.

This commodity price backdrop has encouraged private equity firms to seek exits from long-held energy investments.

Caerus was formed in 2009, with Oaktree and Anschutz as its founding sponsors. Old Ironsides joined its backers in 2017 by helping the company fund a $735 million acquisition of assets in Colorado from Encana Corp.

Caerus, which also bought the Uinta assets of Occidental Petroleum Corp. in 2020, produces natural gas from around 680,000 net acres, according to its website.

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