TG Natural Resources to acquire Rockcliff Energy II from Quantum Energy Partners for $2.7bn

Rockcliff Energy II LLC (“Rockcliff”), a portfolio company of Quantum Energy Partners, has entered into a definitive agreement for its acquisition by TG Natural Resources LLC (“TGNR”). The transaction, valued at US$ 2.7 billion before customary adjustments, represents a significant move in the natural gas industry.

Rockcliff’s Position in the Natural Gas Sector

Rockcliff, an esteemed upstream natural gas company, has carved a niche in developing the East Texas Haynesville shale. With its field headquarters in Longview, Texas, Rockcliff operates over 200,000 net acres, boasting more than 1.3 Bcf/d of gross operated natural gas production across five Texas counties.

Leadership’s Perspective on the Acquisition

Alan Smith, CEO of Rockcliff, reflected on the company’s rapid growth and industry-leading position in the United States. He attributes this success to the dedication of the Rockcliff team and the support from Quantum. Craig Jarchow, CEO of TGNR, expressed admiration for Rockcliff’s progress and Quantum’s role in building a formidable company. He emphasized TGNR’s commitment to leading in the Haynesville Play and advancing clean natural gas sources.

Major Energy Merger: TG Natural Resources to Purchase Rockcliff Energy for $2.7 Billion

Quantum’s Successful Partnership with Rockcliff

Wil VanLoh, CEO of Quantum, highlighted Quantum’s successful history of partnering with entrepreneurs like those leading Rockcliff. He mentioned the transformation of the East Texas Haynesville into a significant supplier of clean U.S. natural gas for LNG exports from the Gulf Coast as a key achievement.

The Strategic Benefits of the Transaction

This acquisition will enhance TGNR’s capabilities in the Haynesville Play, bolstering its position in clean natural gas production. Akira Inukai, President and CEO of Tokyo Gas America, highlighted the alignment of this acquisition with TGNR’s growth strategy, given its proximity to new LNG export terminals.

Closing Details and Advisors

The transaction is expected to close by the end of 2023, subject to customary closing conditions and regulatory approvals. J.P. Morgan Securities and Vinson & Elkins LLP served as financial and legal advisors to Rockcliff, respectively. TGNR was advised by Greenhill, Goldman Sachs & Co. LLC, BofA Securities, Inc., and Kirkland & Ellis.

Impact on the Natural Gas Industry

The acquisition of Rockcliff by TGNR marks a noteworthy consolidation in the natural gas sector, promising long-term growth and value creation. It highlights the evolving dynamics in the energy industry, emphasizing the importance of strategic mergers and acquisitions.