A $500 million IPO priced by Vine Resources Inc. on April 10 is the latest sign that a Haynesville Shale resurgence is real.

After A&D picked up in the Haynesville in 2016, companies such as EXCO Resources Inc. (NYSE: XCO) are shifting to the gas play. EXCO said April 10 that it would sell $300 million worth of Eagle Ford assets to fund drilling in the East Texas and Louisiana shale play.

IPO speculation has been rife among Haynesville E&Ps, with Vine the first to test the waters. Deals in 2016 by private, independent E&Ps Indigo Minerals LLC and Covey Park Energy LLC have fueled speculation that the companies might also explore IPOs.

Vine’s explanation for the Haynesville reemergence centers on increased well economics driven up by enhanced drilling and completion techniques. The company is led by Eric D. Marsh as president and CEO since May 2014. Marsh previously served as president of Encana Corp.’s (NYSE: ECA) USA division and led its natural gas economy team.

“This has led to higher recoveries on a per lateral foot basis through more frack stages and greater proppant usage combined with a steady reduction in well costs,” the company said in regulatory filings.

In 2016, the company recorded a net loss of $161.6 million as revenues, though natural gas sales increased to $184.5 million from $154 million in 2015.

The plays’ proximity to Henry Hub and other premium Gulf Coast markets, LNG export facilities and other end-users hold promise. The company expects to “benefit from low breakeven costs relative to other North American natural gas plays, such as those in Appalachia and the Rockies.”

Vine Oil & Gas LP was born out of a $1.1 billion acquisition from Royal Dutch Shell Plc. (NYSE: RDS.A) to create a pure play Haynesville and mid-Bossier natural gas E&P in northwest Louisiana. The company coalesced around the acquisition in November 2014, which was funded by its private-equity backer The Blackstone Group LP, Vine’s management team and long-term debt.

The purchase included more than 107,000 net acres in North Louisiana. Vine said it now holds 95,000 net surface acres in what it believes is the core of the Haynesville and Bossier shale plays.

About 90% of Vine’s acreage is HBP, “providing us with the flexibility to control the pace of development without the threat of lease expiration,” according to regulatory filings.

“Our assets are located almost entirely in Red River, DeSoto and Sabine parishes of Northwest Louisiana,” the company said, adding that more than 60% of its acreage is prospective for dual-zone development in 1,700 horizontal drilling locations.

“Utilizing eight gross rigs and assuming six wells per 640-acre section, we have over 22 years of organic development opportunities,” the company said in filings with the Securities and Exchange Commission (SEC). In 2016, annual average net daily production was 218 million cubic feet per day, Vine said.

Vine’s production has grown at a compounded annual growth rate of about 48% in a 15-month span from third-quarter 2015 to fourth-quarter 2016. Since the Shell acquisition, the company has brought on 47 wells, it said.

Among 2016 shale deals, the Haynesville attracted six transactions valued at $2.6 billion, according to PwC.

In February, Indigo Minerals and Covey Park Energy separately bought Haynesville assets from Chesapeake Energy Corp. (NYSE: CHK), each paying roughly $450 million. Overall, Chesapeake sold 119,500 acres to the private companies.

Darren Barbee can be reached at dbarbee@hartenergy.com.

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