© Reuters. FILE PHOTO: Chesapeake Energy logo is seen on smartphone in front of displayed stock graph in this illustration taken January 25, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
(Reuters) -Southwestern Energy and Chesapeake Energy (NYSE:) are close to a merger that would create a roughly $17-billion company that would rank as one of the largest U.S. natural-gas producers, the Wall Street Journal reported on Friday.
The deal could come together as soon as next week, the report said, citing people familiar with the matter, provided the talks do not hit a last-minute snag.
Shares of Southwestern and Chesapeake climbed 6.6% and 3.2%, respectively, on the news.
Reuters reported in October that Chesapeake was exploring an acquisition of Southwestern.
A deal would help the combined company overtake EQT (ST:) as the largest natural gas-focused exploration and production firm in the U.S. by market value, at a time when shale companies seeking scale and efficiencies are fueling a rapid consolidation.
In 2021, Chesapeake emerged from a bankruptcy which epitomized the boom and bust of debt-laden exploration and production companies that expanded aggressively in the shale patch.
Since then, the company has been shedding oil-producing assets to focus on its competence in .