(Bloomberg) -- Southwestern Energy Co. is in talks to buy closely held GeoSouthern for roughly $1.7 billion, less than two months after purchasing gas producer Indigo Natural Resources, according to people with knowledge of the matter. 

Discussions are at an advanced stage, though a deal could still fall through, said the people, who declined to be named because the talks are ongoing and private. 

GeoSouthern is a joint venture between Blackstone Credit and billionaire George Bishop’s GeoSouthern Energy Corporation. The entity picked up roughly 112,000 net acres in Louisiana’s Haynesville shale basin from Encana Corp for $850 million in 2015.

Representatives at Spring, Texas-based Southwestern didn’t respond requests for comment. A representative for Blackstone declined to comment. 

The Haynesville, which spans northeast Texas and northwest Louisiana, is the second-largest shale gas producing region in the U.S. While the formation has smaller reserves than the Marcellus-Utica play in the Northeast, its proximity to the Henry Hub and export terminals on the Gulf Coast, as well as the lack of major infrastructure constraints, offer drillers in the basin a competitive advantage.  

GeoSouthern has been searching for a buyer over the past few months amid a flurry of dealmaking buoyed by higher U.S. gas futures, which have nearly doubled since the start of the year.

The deal would follow Chesapeake Energy Corp.’s proposed acquisition of privately held Vine Energy Inc. for about $2.2 billion and Southwestern’s $2.7 billion purchase of Indigo.

Through the Indigo deal and current energy price outlook, Southwestern’s management expects the company to boost cash flow to the $425 million to $475 million range this year. Those proceeds are expected to help bring down Southwestern’s debt to below two times earnings before interest, taxes, depreciation and amortization. 

Southwestern shares were little changed at $4.93 at 9:38 a.m. in New York.

(Updates with details on Haynesville basin in fifth paragraph)

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