HAYNESVILLE DEAL ALERT

Energy Advisors Group (EAG) has issued a Deal Alert, Haynesville A&D Heating Up, following JERA's inaugural US upstream deal, paying $1.5B for the South Mansfield assets owned by GEP Haynesville II - a GeoSouthern and Williams JV. We expect more buying from Japanese firms. Given current forecasts of Haynesville growth trails that of LNG growth, some expect HH gas price will need to rise to spur accelerated Haynesville growth.

The report covers:

1. Insights and Intel
2. History of Haynesville Deals
3. Haynesville and Western Haynesville Updates (Maps, Volumes, Operators, Wells)
4. Detail of Recent Haynesville Deals
5. U.S. LNG Update

Haynesville A&D is heating up.

• JERA makes its first move: $1.5B for GEP Haynesville II’s South Mansfield assets
• EQV grabs Amplify’s assets for $122MM
• Rockcliff III back at it — buys from Pine Wave
• Expand takes down 75,000 acres in Western Haynesville
• Roaring Fork quietly assembles 60,000+ acres on the Texas side
• Citadel rumored to be loading up again (potentially from Comstock/Jerry Jones)
• Aethon remains a crown jewel attracting suitors - can throttle volumes

Haynesville Quick Takes

• Gas demand rising — LNG ramp needs Haynesville molecules
• Expand says <$2.75 breakevens
• BP drilling 20K-ft laterals, hit ~65 MMcf/d tests on 3-milers
• Blackstone Minerals calls Expand’s Houston Co. test a geologic bridge between Western Haynesville & Haynesville Extension (HEX)
• Western Haynesville Update:
• Comstock: Last 10 wells avg. ~38 MMcf/d IP
• Mitsui: Running 2 rigs, has banked 3 DUCs
• Aethon: Temporary Pause
• Expand: Will be drilling 1st HZ in 4Q (Houston Co.)

Contents and Insights:

------ Haynesville Stats: 13.0 Bcfpd, 7,112 producing wells, 57 operators, 37 rigs, 257 permits.

------ Western Haynesville: Comstock leading player with 705,160 gross acres (524,588 net acres). Com Aethon initiated a pause in activity. In contrast, Mitsui has 2 rigs running and 3 DUCs as it is looking to bring on production. Expand has known the area for years and recently staked a 75,000 acre position on the eastern side. Blackstone Minerals postulates whether the Western Haynesville and the Haynesville extension (HEX) may be connected.

------ Deals: JERA pays $1.5B for GEP Haynesville's South Mansfield assets. Rockcliff III buys Pine Wave's position in San Augustine County and plans to run the Rockcliff playbook. EQV buys Amplify's position for $122 MM. Expand initiates a 75,000 acre stake in Western Haynesville. Aethon remains a prized asset for suitors.

------ LNG Growth Engine: Takeaway capacity from the Haynesville south for LNG feedgas is growing rapidly. Among several projects, Williams recently brought its 1.8 Bcfpd Louisiana Energy Gateway project online. Haynesville gas will be needed as an LNG surge is underway.

Here are some Quick Quotes and 5 slides.

Quick Quotes:

------- Haynesville Heating Up. "With JERA’s entry, Japanese firms now control ~15% of Haynesville volumes to hedge LNG offtakes. More volumes are needed as LNG feedgas growth is outpacing Haynesville volumes. Henry Hub prices may need to rise to spur more supply."

------- Content:  “In the original Haynesville, four operators (Expand, Aethon, Comstock, Tokyo Gas) control over 66% of production. Aethon has the ability to serve as swing producer given the supply/demand dynamics with the Basin."

------- Contrast: “We expect Japan and Asian firms to seek more US gas ownership as they pick up the pace on their LNG offtake contracts amid a LNG surge coming on in the next 3 years. For perspective, 16.7 Bcfpd more is expected to come online by 2029 over the baseline of 14.9 Bcfpd at year-end 2024."

------- Context: “The EIA expects Haynesville volumes of 16.1 Bcfpd by year-end 2026, up 500 MMcfpd from current levels. This is 14% of forecast total US marketed gas production of 118.7 Bcfpd."

#1---

Here's a Haynesville Overview (Operators, Positions, Volumes, Rig Count)

#2---

Here's a View of the Western Haynesville

#3---

Here's Details on JERA's Purchase

#4---

Here's Some Highlights from Haynesville Operators

#5---

Here's A Quick View on the US LNG Surge

The FULL 11-page report is available for download to the right.

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