Tellurian seals Haynesville shale acquisition
Tellurian said July 13 it had paid $125mn for natural gas assets in the Haynesville Shale from two privately-held equity funds, EnSight IV Energy Partners and EnSight Haynesville Partners.
The transaction was made through Tellurian's wholly-owned subsidiary Tellurian Production (TPC), but is still subject to customary closing adjustments. TPC's 2022 production forecast is now 140mn ft3/day, up from 39mn ft3/day last year. The extra gas will also support the hedge position for Tellurian's 27.6mn metric tons/yr Driftwood LNG plant, when it arrives on stream in 2026.
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The Haynesville asset portfolio spans around 5,000 net acres in Louisiana, yielding around 45mn ft3/day to EnSight's equity share. It has proved reserves of around 108bn ft3 of natural gas, and a PV-10 projected value of around $180mn.
Tellurian president and CEO Octavio Simoes said: "Tellurian continues to focus on two critical pathways - progressing Driftwood LNG and continuing to increase our upstream footprint. "This transaction grows our 2023 estimated natural gas production by ~30%, increases upstream asset-level EBITDA by ~25%, and expands upon our existing platform.”
TPC president John Howie added: "We have been diligently growing our natural gas production and reserves in the Haynesville.
"These assets provide Tellurian with both cash flow and a physical hedge for Driftwood LNG. The EnSight asset is a great fit with Tellurian’s existing position in the Haynesville shale and allows us to step into an ongoing development program and bring online significant additional natural gas volumes in the fourth quarter of 2022.”