EQT Corporation (NYSE: EQT) today announced it has closed its acquisition of Equitrans Midstream Corporation.
The merger of EQT and Equitrans creates America’s only large-scale, vertically integrated natural gas business. The combined company is projected to have an unlevered NYMEX free cash flow breakeven1 price of approximately $2.00 per MMBtu, which is at the low end of the North American cost curve and ensures robust free cash flow generation through all parts of the commodity cycle.
EQT has identified more than $425 million of annual synergies associated with the combination, which upon realization could drive even further downside to EQT’s long-term free cash flow breakeven price.
The integration of Equitrans’ midstream assets immediately improves the economics of EQT’s approximately 4,000 drilling locations, unlocking unrivaled terminal value at a time when demand for natural gas is inflecting both domestically and abroad.
Toby Z. Rice, President and CEO of EQT, said, “We are excited to complete this highly strategic transaction significantly ahead of our original timeline, and welcome both Equitrans employees and shareholders to EQT. The early close resulted in nearly $150 million of savings relative to our original forecast and brings forward our de-leveraging and synergy capture timetables.”
Rice continued, “We are wasting no time unleashing our integration team, which has a successful track record of rapidly integrating three large-scale acquisitions over the past several years, to efficiently combine these organizations. This combination leaves EQT in a tremendously advantaged position to compete and win as we enter the global era of natural gas.”
In conjunction with the closing, and as previously announced under the terms of the merger agreement, three former Equitrans directors, Vicky A. Bailey, Thomas F. Karam, and Robert F. Vagt, have joined the EQT Board of Directors, effective immediately.
Advisors
Guggenheim Securities, LLC acted as lead financial advisor and RBC Capital Markets, LLC acted as a financial advisor to EQT. Kirkland & Ellis LLP served as EQT’s legal counsel on the transaction. Barclays and Citi served as financial advisors to Equitrans, and Latham & Watkins LLP served as legal counsel to Equitrans.
About EQT Corporation
EQT Corporation is a leading independent natural gas production company with operations focused in the Appalachian Basin. We are dedicated to responsibly developing our world-class asset base and being the operator of choice for our stakeholders. By leveraging a culture that prioritizes operational efficiency, technology and sustainability, we seek to continuously improve the way we produce environmentally responsible, reliable and low-cost energy. We have a longstanding commitment to the safety of our employees, contractors, and communities, and to the reduction of our overall environmental footprint. Our values are evident in the way we operate and in how we interact each day – trust, teamwork, heart, and evolution are at the center of all we do. To learn more, visit eqt.com.
