Wedoany.com Report-Sept. 17, Japan’s largest power generator, JERA, is in advanced negotiations to acquire U.S. natural gas production assets for about $1.7 billion, according to people familiar with the matter. The assets are owned by GEP Haynesville II, a joint venture backed by Blackstone, GeoSouthern Energy, and pipeline operator Williams Companies. Banks recently solicited offers, and JERA emerged as the leading bidder. However, sources cautioned that no final agreement has been reached, and GEP may still consider other buyers or withdraw the sale.

The logo of JERA Co., Inc., the world's biggest LNG buyer, is displayed at the company office in Tokyo, Japan July 14, 2017.

If completed, the deal would represent JERA’s entry into shale gas production and enhance its control over the LNG supply chain. As one of the world’s largest LNG buyers, JERA seeks to secure stable resources as Japan anticipates rising electricity demand driven by data centers linked to artificial intelligence. The company surpassed several U.S.-based energy firms in the bidding process.

Neither JERA nor the asset owners have provided official comments. The move comes as Japan, a country heavily reliant on imported oil and gas, has been expanding its overseas energy partnerships following global market disruptions in recent years.

Interest from Asian energy companies in U.S. natural gas has grown, partly supported by U.S. efforts to expand energy trade with key partners. A trade agreement between the U.S. and Japan finalized this month included Tokyo’s commitment to purchase $7 billion annually in U.S. energy.

JERA, a joint venture between Tokyo Electric Power Company and Chubu Electric Power, has steadily increased its presence in the U.S. LNG sector. Last week, the company signed a letter of intent regarding possible supply from Alaska’s $44 billion LNG export project. Japan has also engaged consultancy Wood Mackenzie to evaluate the project, which involves an 800-mile pipeline and LNG plant.

GEP Haynesville II is one of the leading producers in the Haynesville shale basin of Texas and Louisiana, an important natural gas region due to its proximity to existing and planned LNG export terminals on the U.S. Gulf Coast. Current output from GEP Haynesville II is estimated at 317.5 million cubic feet per day in 2025, with expectations of nearly doubling to 614 million cubic feet per day by 2028, according to Rystad Energy.

The Haynesville basin has long attracted investor interest, given its strategic location and potential to support export growth. In 2021, the original GEP entity sold assets to Southwestern Energy for $1.85 billion during a period of high gas prices. The current sale effort by GEP Haynesville II reflects ongoing buyer appetite in the region and provides private equity backers an opportunity to realize gains.

The outcome of JERA’s bid will shape its role in U.S. shale gas production and could strengthen Japan’s broader energy security through deeper integration with the American natural gas sector.