EP's Haynesville holdings go to PE-backed firm for $420M

We use our North America Well Analysis Tool to map private equity–backed Haynesville operators as another deal takes place in the region, highlighting a growing trend. Our analysts examine EP Energy's history in the gas play and what more deals may mean for Haynesville sub-plays.

EP Energy Corp has sold substantially all its Haynesville and Bossier assets to Dallas-based and private equity (PE)–backed Covey Park . The $420 million deal expands Covey Park's existing core assets in Robertson and Leon counties in Texas to include EP's Caspiana Core and Spider sub-play operations. These newly acquired assets have seen significant drops in production since 2012, as EP transitioned focus to other parts of its portfolio.

Private equity-backed Haynesville operators

Covey Park's management team is dominated by former EXCO Resources executives, who hold deep knowledge of the ArkLaTex Basin and Haynesville/Bossier shale plays. Backed by Denham Capital, Covey Park now joins other PE-backed operators Geosouthern and Vine Oil and Gas as material Haynesville players. A renewed focus on the deal's  assets should afford the Covey Park team operational gains, cost savings and exploration upside.

Deal value depends largely on drilling schedules coinciding with Henry Hub price recovery. We expect to see additional Haynesville deals surface over the summer as more asset packages come onto the market or marketed packages settle on the right transaction price.

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