U.S. LNG project developer Tellurian wants to purchase natural gas assets from privately held oil and gas company EnSight located in the Haynesville Shale.
On 13 July, the company said that its wholly-owned subsidiary Tellurian Production (TPC) entered into an agreement to purchase natural gas assets from privately held EnSight IV Energy Partners, and EnSight Haynesville Partners.
EnSight’s current net production is approximately 45 million cubic feet of natural gas per day (MMcf/d). Its proved reserves amount to approximately 108 billion cubic feet of natural gas (Bcf).
The purchase price is $125 million. There is also a contingent payment of $7.5 million which is based on the price of natural gas and may be payable in March 2023 under certain conditions.
Tellurian will fund the purchase with cash on hand. It anticipates closing on the EnSight assets in the third quarter of 2022.
The effective date of the transaction is 1 August 2022.
Tellurian CEO Octávio Simões 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 per cent, increases upstream asset-level EBITDA by ~25 per cent, and expands upon our existing platform.”
TPC president John Howie added: “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 on-line significant additional natural gas volumes in the fourth quarter of 2022.”
Source: Offshore Energy
