Southwestern buys Indigo for $2.7 billion

Texas-based Southwestern Energy is buying natural gas producer Indigo for $2.7 billion as it looks to expand its access to the US LNG export industry.

Southwestern said in a statement on Wednesday it entered into a definitive merger agreement with Haynesville producer Indigo.

The firm expects the transaction to close early in the fourth quarter, subject to customary closing conditions.

Indigo is one of the largest private US natural gas producers, with core dry gas assets across the stacked pay Haynesville and Bossier zones in northern Louisiana.

In addition, its “high-margin assets are located in close proximity to the growing demand in the Gulf Coast LNG corridor,” Southwestern said.

The assets are located near Sabine Pass, Cameron and Calcasieu Pass LNG export plants.

Indigo currently produces 1 Bcf per day net but the firm expects to produce about 1.1 Bcf per day net upon closing of the deal.

“Our footprint now extends across the two premier natural gas basins in the country and includes top-tier dry gas and liquids rich inventory,” said Southwestern chief executive Bill Way.

“The value of this high-quality inventory is further enhanced by our diverse transportation portfolio providing access to premium markets in the Gulf Coast and within Appalachia,” he said.

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