EQT Corporation · NYSE:EQT
EQT — Merger or Acquisition (September 2022)
15 slides from EQT's merger presentation, Sep 6, 2022
Slide 1: Strategic Bolt-On Acquisition: Tug Hill and XcL Midstream
Strategic Bolt-On Acquisition Tug Hill and XcL Midstream September 6, 2022 9/14/20 1 1 22
Slide 2: Strategic Bolt-On Acquisition Strengthens EQT's Business
Strategic Bolt-On Acquisition Strengthens EQT’s Business Adding low-risk, high-quality assets offsetting existing acreage with improved free cash flow durability › Strategic bolt-on of Tug Hill brings 800 MMcfe/d, 11 years of inventory in core SW APPALACHIA ACREAGE POSITION Southwest Appalachia offs
Slide 3: Integrated Full-Service Midstream Franchise
Integrated Full-Service Midstream Franchise XcL assets connect to every major long-haul pipeline in southwest Appalachia › Owned and operated midstream system drives low integrated cost structure, robust economics and increased operational control MIDSTREAM ASSET MAP › Strategically positioned in th
Slide 4: Conservative Underwriting With Compelling Valuation
Conservative Underwriting With Compelling Valuation 2.3x NTM EBITDA(1) for upstream assets; implied <$3.00/MMBtu long-term natural gas price ATTRACTIVE VALUATION AND CONSERVATIVE UNDERWRITING IMMEDIATE ACCRETION $5.2 B Total $6.0 Consideration ATTRACTIVE VALUATION AT 2.7x NTM EBITDA(1) › 2.3x NTM EB
Slide 5: Transaction Lowers Free Cash Flow Breakeven Pricing
Transaction Lowers Free Cash Flow Breakeven Pricing Tug Hill, XcL further improve the durability of EQT’s free cash flow generation ’22-’27 AVERAGE FREE CASH FLOW(1) BREAKEVEN $/MMBtu ACQUISITION MAKES EQT’S FREE CASH FLOW EVEN MORE RESILIENT $2.50 › Tug Hill’s liquids yield and integrated midstream
Slide 6: Deal Paired with Incremental Firm Transportation Capacity
Deal Paired with Incremental Firm Transportation Capacity Additional Midwest and Gulf capacity along with MVP advancement materially lessens basis risk INCREMENTAL FIRM IN-BASIN EXPOSURE OUTLOOK TRANSPORTATION DE-RISKS MMcfe/d BASIS EXPOSURE 800 › EQT recently secured ~200 MMcf/d of incremental firm
Slide 7: Strong Historical ESG Performance Aligns with EQT's Goals
Strong Historical ESG Performance Aligns with EQT’s Goals Tug Hill methane emissions intensity industry-leading PRODUCTION SEGMENT SCOPE 1 METHANE EMISSIONS INTENSITY(1) MT CH4 Emitted / (Gross Annual Production * Methane Content [MT CH4]) TUG HILL & XcL EQT Tug Hill ENVIRONMENTAL HIGHLIGHTS ONE Fut
Slide 8: Deal Triggers Material Increase to Shareholder Returns
Deal Triggers Material Increase to Shareholder Returns Doubling share repurchase authorization to $2.0 billion CAPITAL ALLOCATION FRAMEWORK DECEMBER JULY SEPTEMBER PRIORITIES & PRINCIPLES FRAMEWORK FRAMEWORK FRAMEWORK (2022-2023) (2022-2023) (2022-2023) $4.0 B IN ABSOLUTE DEBT REDUCTION $1.5 B $2.5
Slide 9: Transaction Summary
Transaction Summary Bolt-on of largest remaining private operator in SW Marcellus; integrated assets drive greater free cash flow durability › On September 6, 2022 EQT announced the acquisition of Tug Hill and XcL Midstream from Quantum Energy Partners for $5.2 B, subject to customary closing adjust
Slide 10: Attractive Bolt-On Acquisition Hits All the Marks
Attractive Bolt-On Acquisition Hits All the Marks Strategic transaction strengthens core business and supports increased shareholder returns ACQUIRING HIGH-QUALITY UPSTREAM & MIDSTREAM ASSETS Acreage position highly-complementary to EQT’s core asset base Liquids yield and integrated midstream drive
Slide 11: Cautionary Statements and Non-GAAP Definitions
Cautionary Statements and Non-GAAP Definitions 11 11
Slide 12: Cautionary Statements
Cautionary Statements EQT Corporation (NYSE: EQT) EQT Plaza 625 Liberty Avenue, Suite 1700 Pittsburgh, PA 15222 Cameron Horwitz – Managing Director, Investor Relations & Strategy – 412.395.2555 The Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC,
Slide 13: Non-GAAP Financial Measure: EBITDA
Non-GAAP Financial Measure EBITDA EBITDA is defined as net income (loss), excluding interest expense, income tax (benefit) expense, depreciation and depletion, (gain) loss on sale/exchange of long-lived assets, impairments, the revenue impact of changes in the fair value of derivative instruments pr
Slide 14: Non-GAAP Financial Measure: Free Cash Flow
Non-GAAP Financial Measure Adjusted Operating Cash Flow, Free Cash Flow, Free Cash Flow Yield and Free Cash Flow Per Share Adjusted operating cash flow is defined as net cash provided by operating activities less changes in other assets and liabilities. Free cash flow is defined as adjusted operatin
Slide 15: Non-GAAP Financial Measure: Net Debt and Leverage
Non-GAAP Financial Measure Net Debt and Leverage Net debt is defined as total debt less cash and cash equivalents. Total debt includes the Company's current portion of debt, credit facility borrowings, senior notes and note payable to EQM Midstream Partners, LP. Leverage is defined as net debt divid