Brad Nelson, managing director and head of energy M&A for Stephens, speaks during Hart Energy’s DUG Gas Conference & Expo in Shreveport, Louisiana, on March 20, 2025. (Source: Hart Energy)
Oil-focused M&A, particularly around the Permian Basin, has dominated headlines for years. But buyer interest is growing for natural gas assets, according to M&A experts.
“In the past nine to 12 months, we’ve seen a pretty dramatic shift from oil-weighted deals to gas-weighted deals,” Brad Nelson, managing director and head of energy M&A for Stephens, said at Hart Energy’s 2025 DUG Gas Conference & Expo in Shreveport, Louisiana.
Between 60% to 70% of the deals Stephens is seeing today are gas-weighted, he said. Just a few years ago, as much as 80% of buyer interest was on oil-weighted assets.
But the trend didn’t start overnight. Buyers interested in U.S. gas started shopping for deals in late 2023 and early 2024, when U.S. natural gas prices were still hovering below $2/Mcf.
“You could absolutely tell that people were thinking long-term about gas—this is early 2024—and really leaning into ’25, ’26 and beyond,” Nelson said.
Brody Rollins, a managing director in Jefferies’ energy investment banking group, said reemerging buyer interest in natural gas is adding onto an active M&A market for oil assets.
Gas isn’t necessarily stealing capital away from the oil deal market.
“Frankly, I kind of tell people it’s like natural gas decided to join the party, if you will,” Nelson said.
But “in terms of aggregate deal volume, gas has certainly picked up,” Rollins said.
“There’s clearly a focus on natural gas, both domestically and internationally,” Rollins said. “Whether it’s public investors, the strategics that [are] already involved in natural gas, plus renewed interest from the majors, international investors and people thinking about linkages between LNG and AI to natural gas demand.”
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Searching for sticks
Buyers want a piece of the Haynesville, but there’s relatively little of the Haynesville still available to buy.
Buyers will need to pay a scarcity premium for “highly valuable” Haynesville inventory now, said Craig Jarchow, president and CEO of TG Natural Resources (TGNR), the Haynesville’s fourth-largest producer.
After acquiring East Texas producer Rockcliff Energy II for $2.7 billion in December 2023, TGNR is rumored to be on the hunt for its next Haynesville acquisition.
A sluggish Haynesville M&A market started to show signs of life after TGNR’s acquisition of Rockcliff.
Last summer, privately held Aethon Energy acquired Tellurian’s upstream assets for $260 million. Aethon is the second largest Haynesville producer behind Expand Energy.
Expand Energy was created in October 2024 with the closure of merger between Chesapeake Energy and Southwestern Energy, which consolidated huge swathes of Haynesville acreage.
In February, hedge fund giant Citadel acquired Haynesville E&P Paloma Natural Gas for $1.2 billion, Hart Energy reported. Paloma was backed by private equity firm EnCap Investments LP.
But fewer obvious M&A takeout targets remain standing in the Haynesville. TGNR, backed by Tokyo Gas and Sabine Oil & Gas, backstopped by Japan’s Osaka Gas, aren’t expected to be sellers in the near term.
Rumors are swirling that TGNR is interested in buying Chevron’s mostly undeveloped Haynesville property in Panola County, Texas.
Notable private Haynesville producers include GeoSouthern’s GEP Haynesville II, Trinity Operating, EXCO Resources and Silver Hill Energy Partners, according to Enverus Intelligence Research data.
As buyers search for other gas inventory, they’ll probably expand their search into other gassy basins, Rollins said.
“I think that’s going to expand into the Midcontinent, where you’ve seen a lot of M&A activity,” he said.
Privately held Validus Energy has been an active buyer in the Midcontinent recently. In the past year, Validus has spent more than $4 billion on assets held by E&Ps Citizen Energy, 89 Energy and Continental Resources.
Dry gas plays in South Texas, such as EOG Resources’ Dorado gas play near the Texas-Mexico border, will also interest buyers.
“You’re now seeing these other basins come back to a certain degree,” Nelson said.
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‘Globally’ important Haynesville gas
As interested buyers scour the Lower 48 for gas-weighted drilling inventory, the Haynesville Shale sticks out for several reasons.
The Haynesville contains prolific reserves of natural gas and is one of the nation’s top gas-producing regions. Haynesville production averaged 14.1 Bcf/d in fourth-quarter 2024, according to Energy Information Administration (EIA) data.
Haynesville gas is also dry gas, which requires less processing than liquids-rich “wet” gas from the Permian and Appalachian basins.
Geography is the Haynesville’s most attractive feature. Spanning the Texas-Louisiana border, the Haynesville basin sits near the growing LNG export corridor along the U.S. Gulf Coast.
Experts are looking at the Haynesville, with its prodigious gas supply, nearness to demand centers and ample pipeline capacity, to fill incremental demand from new LNG export projects.
“It is a strategically relevant natural gas play globally—that’s what the Haynesville is,” Rollins said.
Haynesville gas output is forecast to average 18 Bcf/d by fourth-quarter 2026, according to the EIA’s latest estimate—a 27% increase from 14.1 Bcf/d in fourth-quarter 2024.
That growth outlook, however, seems aggressive to Haynesville producers. Haynesville output by year-end 2026 might be closer to 16 Bcf/d, Aethon Energy President and Partner Gordon Huddleston said at DUG Gas.
Aethon plans to spend $1 billion to keep gross output flat around 3 Bcf/d this year. But the company has the capacity to grow. It could double capex to $2 billion and boost production by another 500 MMcf/d to 600 MMcf/d after accounting for base declines.
But Aethon won’t boost spending without higher forward prices—preferably above $5/Mcf—sustained over a longer period.
The 12-month Henry Hub strip price averaged $4.53 as of March 24, according to CME Group data; the 24-month strip is $4.39.
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