Expand Energy, the most prominent gas producer in the Haynesville Basin, as well as the second largest by volume in the Appalachian basin, reported earnings on July 28. In their earnings call and presentation, they communicated their views on Haynesville and Appalachian Basis dynamics, their acquisition of Twin Eagle, and touched on their price outlook and hedging strategy.
Basis Dynamics
Expand projects growth in the US natural gas market over the next couple of decades. In their demand forecasts, they focused primarily on the two basins in which they primarily operate. Across Haynesville and Appalachia, they project a combined 4-6 Bcf/d of power demand growth by 2030, and by 2040 they project 7-10 Bcf/d. Dan Turco, Executive VP of Expand, said “We tend to be more conservative than others [on the power side]. Data centers [are] a big story, but there’s also micro-grid solutions [and] balancing of markets.”
On the Haynesville side, they also forecast sizeable Industrial demand growth over the next couple of decades. “[Industrial is] often a part of the market that’s missed. [It’s] really in our backyard down in the Haynesville.”
Source: Expand Energy Q2 Earnings Presentation
Additionally, they forecast LNG demand growth along the Gulf Coast to contribute to further demand pull from the Haynesville basin. They forecast an additional 13-15 Bcf/d of LNG feedgas demand by decade end, and 21-25 Bcf/d of growth by 2040. The company sees US LNG growth as key to fulfilling growing global LNG demand, which they estimate to grow from 55 Bcf/d last year to 86 Bcf/d by 2040.
Source: Expand Energy Q2 Earnings Presentation
Twin Eagle Acquisition
A key theme of their Q2 earnings call was Expand Energy’s acquisition of Twin Eagle. In their responses to Analysts questions on the reasoning for the acquisition, they provide further insight into their views on the North American natural gas market wholistically. Mike Wicheterich, interim CEO of Expand, said that “this is a demand-pull future as opposed to a supply future. So, if you think [the number one goal] is to get customers, Twin Eagle has that.” Later in the call Wichterich added that the value of Twin eagle was to help them identify and put demand together so they could grow into it. This acquisition, and their justification for it, highlights their forecast of natural gas demand growth.
Price Outlook and Hedging Strategy
Expand holds a $3.50-$4.00 mid-cycle Henry Hub view, which they reaffirmed in their latest earnings call. They frame LNG, power, and industrial demand growth as the force that will pull the market into higher-cost supply toward the end of the decade. However, in correspondence with many analysts’ views, they forecast some headwinds over the next year. Josh Viets, Expand COO noted that in the Haynesville basin, “the market sits in a modestly oversupplied position right now [partially due to] Permian egress that’s coming to the tune of [roughly] 3.5 Bcf/d of additional egress by year end.” He added that Expand expects markets to remain in an oversupplied position through at least the first half of 2027.
However, the company has taken protective measures against this short-term over supply through their hedging program. They have 66% of their production hedged for the remainder of 2026 and 41% of their production hedged in 2027 at prices above current strips.
Source: Expand Energy Q2 Earnings Presentation