EQT July 2014 Analyst Presentation Slide Deck

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Analyst PowerPoint presentation used for an analyst call on July 24, 2014 by EQT management. The deck contains a number of useful and interesting slides about EQT's drilling program and midstream …

Analyst PowerPoint presentation used for an analyst call on July 24, 2014 by EQT management. The deck contains a number of useful and interesting slides about EQT's drilling program and midstream (pipeline) operations. EQT continues to be a major player in the Marcellus. They plan to drill their very first Utica well later this year--in Greene County, PA.

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  • 1. Analyst Presentation July 24, 2014
  • 2. 2 EQT Corporation (NYSE: EQT) EQT Plaza 625 Liberty Avenue, Suite 1700 Pittsburgh, PA 15222 Pat Kane - Chief Investor Relations Officer (412) 553-7833 The Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable and possible reserves that a company anticipates as of a given date to be economically and legally producible and deliverable by application of development projects to known accumulations. We use certain terms in this presentation, such as “EUR” (estimated ultimate recovery) and total resource potential, that the SEC's rules strictly prohibit us from including in filings with the SEC. We caution you that the SEC views such estimates as inherently unreliable and these estimates may be misleading to investors unless the investor is an expert in the natural gas industry. We also note that the SEC strictly prohibits us from aggregating proved, probable and possible (3P) reserves in filings with the SEC due to the different levels of certainty associated with each reserve category. Disclosures in this presentation contain certain forward-looking statements. Statements that do not relate strictly to historical or current facts are forward- looking. Without limiting the generality of the foregoing, forward-looking statements contained in this presentation specifically include the expectations of plans, strategies, objectives and growth and anticipated financial and operational performance of the Company and its subsidiaries, including guidance regarding the Company’s strategy to develop its reserves; drilling plans and programs (including spacing and the number, type, average lateral length and location of wells to be drilled); projected natural gas prices, including liquids price uplift and changes in basis; projected market mix and Permian Basin production mix; total resource potential, reserves, EUR and expected decline curve; projected production sales volume and growth rates (including liquids sales volume and growth rates); internal rate of return (IRR), compound annual growth rate (CAGR), and expected after-tax returns per well; technology (including drilling and completion techniques); projected finding and development costs, operating costs, unit costs, well costs, and gathering and transmission revenue deductions; projected gathering and transmission volumes and growth rates; the Company’s access to, and timing of, capacity on third-party pipelines; infrastructure programs (including the timing, cost and capacity of such programs); the timing, cost and capacity of the Ohio Valley Connector (OVC) and Mountain Valley Pipeline (MVP) projects; the expected terms and structure of the proposed joint venture related to the MVP project, including the affiliate(s) of the Company to own and/or operate the MVP; projected EBITDA; projected cash flows resulting from, and the value of, the Company’s general partner and limited partner interests and incentive distribution rights in EQT Midstream Partners, including the assumptions used in making such projections; monetization transactions, including midstream asset sales (dropdowns) to EQT Midstream Partners and other asset sales and joint ventures or other transactions involving the Company’s assets; the amount and timing of any repurchases under the Company’s share repurchase authorization; projected capital expenditures; liquidity and financing requirements, including funding sources and availability; projected operating revenue and cash flows; hedging strategy; the effects of government regulation and litigation; the Company dividend and EQT Midstream Partners distribution amounts and rates; and tax position. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from projected results. Accordingly, investors should not place undue reliance on forward-looking statements as a prediction of actual results. The Company has based these forward-looking statements on current expectations and assumptions about future events. While the Company considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks and uncertainties, most of which are difficult to predict and many of which are beyond the Company’s control. With respect to the proposed OVC and MVP projects, these risks and uncertainties include, among others, the ability to obtain regulatory permits and approvals, the ability to secure customer contracts, the availability of skilled labor, equipment and materials, and, with respect to the MVP, the risk that the parties may not consummate the joint venture. Additional risks and uncertainties that may affect the operations, performance and results of the Company’s business and forward-looking statements include, but are not limited to, those set forth under Item 1A, “Risk Factors,” of the Company’s Form 10-K for the year ended December 31, 2013, as updated by any subsequent Form 10-Qs. Any forward-looking statement speaks only as of the date on which such statement is made and the Company does not intend to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise. EQT Cautionary Statements
  • 3. 3 The Company uses Adjusted EQT Midstream EBITDA as a financial measure in this presentation. Adjusted EQT Midstream EBITDA is defined as EQT Midstream operating income (loss) plus depreciation and amortization expense less gains on dispositions. Adjusted EQT Midstream EBITDA also excludes EQT Midstream results associated with the Big Sandy Pipeline and Langley processing facility. Adjusted EQT Midstream EBITDA is not a financial measure calculated in accordance with generally accepted accounting principles (GAAP). Adjusted EQT Midstream EBITDA is a non-GAAP supplemental financial measure that Company management and external users of the Company’s financial statements, such as industry analysts, investors, lenders and rating agencies, use to assess: (i) the Company’s performance versus prior periods; (ii) the Company’s operating performance as compared to other companies in its industry; (iii) the ability of the Company’s assets to generate sufficient cash flow to make distributions to its investors; (iv) the Company’s ability to incur and service debt and fund capital expenditures; and (v) the viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities. The Company believes that the presentation of Adjusted EQT Midstream EBITDA in this presentation provides useful information in assessing the Company’s financial condition and results of operations. Adjusted EQT Midstream EBITDA should not be considered as an alternative to EQT Midstream operating income or any other measure of financial performance or liquidity presented in accordance with GAAP. Adjusted EQT Midstream EBITDA has important limitations as an analytical tool because it excludes some but not all items that affect operating income. Additionally, because Adjusted EQT Midstream EBITDA may be defined differently by other companies in the Company’s industry, the Company’s definition of Adjusted EQT Midstream EBITDA will most likely not be comparable to similarly titled measures of other companies, thereby diminishing the utility of the measure. Please see slide 49 in the Appendix for a reconciliation of Adjusted EQT Midstream EBITDA to EQT Midstream operating income, its most directly comparable financial measure calculated in accordance with GAAP. The Company is unable to provide a reconciliation of projected EBITDA to projected operating income, the most comparable financial measure calculated in accordance with GAAP, due to the unknown effect, timing and potential significance of certain income statement items. Non-GAAP Measures
  • 4. 4 Finding and development costs (F&D costs) from all sources for peer companies presented in this presentation are calculated as the cost incurred, relating to natural gas and oil activities in accordance with Financial Accounting Standards Board Accounting Standards Codification 932 (ASC 932), divided by the sum of extensions, discoveries and other additions; purchase of natural gas and oil in place; and revisions of previous estimates, as provided for years 2011 – 2013 and derived from publicly available information filed with the SEC. Per unit operating expenses are calculated by dividing the sum of lease operating expenses, production taxes and the gathering and transmission costs for equity gas, by production sales volumes for the same period. Per unit operating expenses in the presentation are calculated from publicly available information filed with the SEC for the year ended December 31, 2013. Calculations Within This Presentation
  • 5. 5  Extensive reserves of natural gas*  8.3 Tcfe Proved; >23 years R/P  36.4 Tcfe 3P; >100 years R/P  44 Tcfe Total Resource Potential; >120 years R/P  Proven ability to profitably develop our reserves  > 24% production sales volume growth in 2014  Industry leading cost structure  Extensive and growing midstream business  EQT Midstream Partners, LP (NYSE: EQM)  EQT is general partner and owns 36.4% equity interest  Estimated G.P. value ~$4 billion  Ongoing source of low cost capital  Approximately 60% of midstream business Key Investment Highlights *As of 12/31/13
  • 6. 6  2013 Operating Income of $654.6 million Leading Appalachian E&P Company 8.3 Tcfe proved reserves 3.6 MM acres 10,400 pipeline miles As of 12/31/13
  • 7. 7 0 200 400 600 800 1,000 1,200 1,400 1,600 Marcellus Huron horizontal Vertical  Marcellus Shale drilling driving growth Production By Play ProductionMMcf/d Began horizontal drilling 2006 2007 2008 2009 2010 2011 2012 2013 2014E
  • 8. 8 Proved Reserve Growth Reserves By Play 36.4 Tcfe 3P reserves (as of December 31, 2013) 44 Tcfe Total Resource Potential 1,061 2,879 3,414 4,278 5,956 2,016 1,475 1,062 965 1,316 991 866 889 761 861 215 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 2009 2010 2011 2012 2013 Bcfe Upper Devonian CBM/Other Huron Marcellus 4,068 5,220 6,004 8,348 5,365 Marcellus 18.5 Huron 11.5
  • 9. 9  Near term development focused in four areas Marcellus Play 580,000 EQT acres 86% NRI / 80% HBP 33% “wet” 18.5 Tcfe 3P 23.9 Tcfe total resource potential 201 wells in 2014 >50% of acreage will utilize RCS Central PA Southwestern PA Northern WV (Wet) EQT acreage Northern WV (Dry)
  • 10. 10  Prolific dry gas region Marcellus Play Southwestern PA 115,000 EQT acres 1,460 locations 209 wells online* 102 wells in 2014 4,800 foot laterals 79 acre spacing 10.0 Bcfe EUR / well 2,088 Mcfe EUR / ft. of lateral $6.4 MM / well > 90% of locations utilize RCS Scotts Run Pad 8 wells 5,814’ Avg Lateral Length per well 15,407 Mcfe Avg 30-day IP per well Pierce Pad 9 wells 7,855’ Avg Lateral Length per well 17,025 Mcfe Avg 30-day IP per well Kevech Pad 6 wells 2,970’ Avg Lateral Length per well 8,873 Mcfe Avg 30-day IP per well * As of 6/30/2014 Oliver West Pad 3 wells 3,919’ Avg Lateral Length per well 9,291 Mcfe Avg 30-day IP per well Gallagher Pad 5 wells 4,436’ Avg Lateral Length per well 9,788 Mcfe Avg 30-day IP per well EQT acreage Producing wells
  • 11. 11  Enhanced economics from liquids uplift Marcellus Play Northern West Virginia – Wet Gas Area 90,000 EQT acres 1,060 locations 134 wells online** 73 wells in 2014 4,800 foot laterals 83 acre spacing 9.8 Bcfe EUR / well* 2,043 Mcfe EUR / ft. of lateral* $6.4 MM / well 100% of locations utilize RCS Producing Pads Big 190 Pad 5 wells 6,308’ Avg Lateral Length per well 12,511 Mcfe Avg 30-day IP per well PEN 16 Pad 5 wells 3,562’ Avg Lateral Length per well 8,883 Mcfe Avg 30-day IP per well * Liquids converted at 6:1 Mcfe per barrel (1.8 Bcfe per well from liquids.) EUR assumes ethane rejection. Ethane recovery would result in EUR of 12.0 Bcfe ** As of 6/30/2014 OXF160 Pad 3 wells 5,286’ Avg Lateral Length per well 9,317 Mcfe Avg 30-day IP per well EQT acreage Producing wells
  • 12. 12  Early stages of acreage delineation Marcellus Play Central Pennsylvania 80,000 EQT acres 720 locations 50 wells online* 18 wells in 2014 4,800 foot laterals 110 acre spacing 6.6 Bcfe EUR / well 1,375 Mcfe EUR / ft. of lateral $6.4 MM / well 100% of locations utilize RCS Frano Pad 3 wells 4,409’ Avg Lateral Length per well 7,532 Mcfe Avg 30-day IP per well Gibson Pad 2 wells 6,381’ Lateral Length 8,592 Mcfe 30-day IP * As of 6/30/2014 EQT acreage Producing wells
  • 13. 13  EQT’s newest development area Marcellus Play Northern West Virginia – Dry Gas Area 30,000 EQT acres 300 locations 46 wells online* 8 wells in 2014 4,800 ft laterals 97 acre spacing 8.4 Bcfe EUR / well 1,741 Mcfe EUR / ft. of lateral $6.3 MM / well 80% of locations utilize RCS GRT26 Pad 2 wells 3,270’ Avg Lateral Length per well 6,547 Mcfe Avg 30-day IP per well RSM119 Pad 6 wells 3,537’ Avg Lateral Length per well 3,529 Mcfe Avg 30-day IP per well * As of 6/30/2014 Flanigan Pad 2 wells 6,889’ Avg Lateral Length per well 9,417 Mcfe Avg 30-day IP per well EQT acreage Producing wells
  • 14. 14 Marcellus Economics IRR - Blended Marcellus Development Areas Realized Price PRICE ATAX IRR $4.00 59% $4.50 82% $5.00 110% See appendix for IRR by development area
  • 15. 15  Developed in conjunction with Marcellus Upper Devonian Play *As of 6/30/2014 Near-term Upper Devonian testing & development area 170,000 near-term testing & development EQT acres 2,000 locations 22 wells online* 36 wells in 2014 4,800 foot laterals 83 acre spacing 6.1 Bcfe EUR / well* 1,274 Mcfe EUR / ft. of lateral $5.6 MM / well 2014 drilling program to delineate acreage position Wetzel County 11 wells 4,396’ Avg Lateral Length per well 5,663 Mcfe Avg 30-day IP per well Greene County 7 wells 5,964’ Avg Lateral Length per well 8,191 Mcfe Avg 30-day IP per well EQT acreage
  • 16. 16  Targeting deep, high pressure rock beneath existing development areas Dry Utica / Point Pleasant Potential 400,000 EQT acres 3,000 locations 1 well in Q4 2014 Greene County, PA 6,400 foot lateral 13,500 feet deep $12 - $17 MM / well EQT acreage
  • 17. 17  Targeting high-return, liquid-rich acreage Huron Play Kentucky 120 wells 1.4 MM EQT acres 85 % Wet; 15 % Dry 10,000+ horizontal locations 900 horizontal wells online** 120 wells planned in 2014 6,000 foot laterals 1.4 Bcfe EUR / well* 230 Mcfe EUR / ft. of lateral* $1.6 MM / well * Liquids converted at 6:1 Mcfe per barrel (0.4 Bcfe per well from liquids). EUR assumes ethane rejection. ** As of 6/30/2014 EQT acreage
  • 18. 18  Stacked Horizontal Potential Permian Basin Howard Mitchell Nolan Coke Sterling Glasscock Reagan Irion Tom Green 73,000 net acres 78% WI / 62% NRI 98% HBP 500 MMBOE of resource potential Stacked Play Opportunity Upper Wolfcamp Lower Wolfcamp Cline Development 1,500-1,700 horizontal locations 2014: 4 wells 2015: 20-30 wells ~$7.5 MM / well Production mix 28% Oil, 47% NGLs, 25% Gas Permian reserves are based on internal estimates and have not been independently audited EQT acreage
  • 19. 19 Industry Leading Cost Structure $/Mcfe$/Mcfe 3-year F&D (all sources) Per Unit Operating Expenses Mean = $1.68 Mean = $2.74 For the three years ended 12/31/13 Year ended 12/31/13 $0.88 $0.52
  • 20. 20 Liquids Volume Growth and Marcellus Price Uplift (1) Pricing is as of 7/17/2014 and is the 1 year forward NYMEX and Mount Belvieu for Propane $1.06, Iso- Butane $1.30, Normal Butane $1.26, and Pentanes $2.07 - 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 2008 2009 2010 2011 2012 2013 2014F Mbbls Includes natural gas liquids and oil Liquids Volume Growth $4.10 $4.10 $0.82 $0.18 $1.55(1)$4.93 $5.84 $0.00 $1.00 $2.00 $3.00 $4.00 $5.00 $6.00 Not Processed Processed $/Mcf Marcellus Liquids Price Uplift (1200 Btu Gas) NGLs (1.6 Gal/Mcf) Btu Premium NYMEX
  • 21. 21  Transmission & Storage  Gathering  Marketing  Formed MLP in 2012 (NYSE: EQM)  ~60% of midstream business Midstream Overview EQT Midstream Total* Transmission capacity (BBtu/d) 2,700 Miles of transmission pipeline 900 Marcellus gathering capacity (BBtu/d) 1,500 Miles of Marcellus gathering pipeline 100 Compression horsepower 300,000 Working gas storage (Bcf) 47 *As of 12/31/13 Legend Transmission Gathering EQT Leases Storage Pool Marcellus Huron Utica
  • 22. 22  EQT Production sales drive EQT Midstream EBITDA growth  70% of Midstream revenues from EQT Corporation  Fixed fee contracts  Transmission contracts with 15-year weighted average life*  Minimal direct commodity exposure Midstream Overview ¹ Pro-forma reflecting full-year impact of Jupiter acquisition *Based on revenues as of 12/31/2013 **Excludes Big Sandy and Langley in 2008-2011; see Non-GAAP Reconciliation on slide 49 Bcfe $MM EQT Corporation Adjusted EQT Midstream EBITDA** 0 100 200 300 400 500 $0 $100 $200 $300 $400 $500 2008 2009 2010 2011 2012 2013 2014E¹ EQT Midstream EQT Midstream Partners, LP Production Sales Volumes (Bcfe)
  • 23. 23  Transmission and storage  2.25 Tbtu/d current capacity  700 mile FERC-regulated interstate pipeline  32 Bcf of working gas storage  Gathering System  Jupiter Gathering System  Highlights market valuation of midstream assets  EQT ownership  2.0% GP interest – 1.2 MM units  34.4% LP interest – 21.3 MM units EQT Midstream Partners, LP (NYSE: EQM) *Based on 2014 EBITDA guidance by EQT Midstream Partners EQM Price per Unit Implied EBITDA Multiple* Value of EQM LP Units ($MM) $90 21.1x $1,917 $92 21.6x $1,960 $94 22.0x $2,002 $96 22.5x $2,045 $98 23.0x $2,087 $100 23.4x $2,130 EQM Compressor Station Equitrans Transmission Sunrise Pipeline Jupiter area Equitrans Gathering Storage Pool EQT Acreage Marcellus Fairway
  • 24. 24 EQT Midstream Partners, LP Distributions *Forecast based on assumed $0.03 per unit quarterly distribution increase each quarter through 2019 $2.14 $2.62 $3.10 $3.58 $4.06 $4.54 $0.00 $1.00 $2.00 $3.00 $4.00 $5.00 $6.00 $7.00 $8.00 2014E 2015E 2016E 2017E 2018E 2019E TotalDistributionperLPUnit LP Unit Distribution GP Distribution per LP Units $2.37 $3.31 $4.27 $5.23 $6.19 $7.15  EQM forecasting 29% per unit distribution growth in 2014*  EQM forecasting 22% per unit distribution growth in 2015*
  • 25. 25 EQT Midstream Partners, LP General Partner Cash Flow Valuation Assumptions: -$0.03 per unit quarterly distribution increase each quarter through 2019 -$75 Million of EBITDA dropped in ’15, ’16, & ’17 at 10.0x EBITDA financed 50/50 debt/equity $0 $50 $100 $150 $200 $250 2014E 2015E 2016E 2017E 2018E 2019E $Millions $14 $45 $82 $123 $194 $158  Present value of GP cash flows = $3.9 billion 2014E Present Value of 2014-2019 470$ Present Value Terminal Value 3,435$ Present Value of GP Cash Flows 3,905$ $ Billion 3.0% 4.0% 5.0% 7.0% 4.1$ 5.3$ 7.8$ 8.0% 3.2$ 3.9$ 5.1$ 9.0% 2.6$ 3.1$ 3.8$ WACC GP Discounted Cash Flow Sensitivity Terminal Growth
  • 26. 26  EQT sold to EQT Midstream Partners May 2014  $1.2 billion  35 mile gathering system in Greene and Washington Counties in Pennsylvania  10-year firm transportation agreement  Currently 225 MMcfe/d  Additional 550 MMcfe/d by year-end 2015 EQT Midstream Partners, LP Jupiter Gathering System Jupiter Central PA Southwestern PA Northern WV (Wet) Northern WV (Dry)
  • 27. 27 Tioga 65 MMcf/d Pluto 60 MMcf/d Mercury 250 MMcf/d Saturn 225 MMcf/d Longhorn 130 MMcf/d Terra 80 MMcf/d Applegate 150 MMcf/d Jupiter* Equitrans Transmission EQT acreage EQT Midstream Marcellus Gathering (MMcf/d) 2013 year-end capacity 2014 capacity additions Total capacity after additions Pennsylvania 1,150 120 1,270 West Virginia 350 320 670 Total 1,500 440 1,940 NOTE: Capacity for each system represents estimated year-end 2014 capacity 2014 CAPEX $240 MM (EQT) $105 MM (EQM)
  • 28. 28  Allegheny Valley Connector  EQT acquired December 2013  200 mile FERC-regulated interstate pipeline  450 BBtu/d capacity  15 Bcf working gas storage  ~$90 MM CAPEX in 2014  ~$40 MM projected annual EBITDA EQT Midstream Transmission Equitrans Transmission Allegheny Valley Connector EQT acreage Allegheny Valley Connector Storage Field
  • 29. 29  Pipeline to growing demand center in southeast US  Completed a non-binding open season in July 2014  Expected JV with NextEra Energy  JV to construct & own pipeline  EQT and/or EQM will be operator  2 Bcf/day capacity  1 Bcf/day committed from two Foundation Shippers  Q4 2018 expected in-service EQT Midstream Mountain Valley Pipeline Project
  • 30. 30  Safety – Our first priority  All accidents are preventable  Company goal = zero incidents  Committed to:  The environment  Our employees and contractors  The communities where we drill and work  EQT Foundation charitable giving of >$4 million / year  More than $20 million / year in state and local taxes Corporate Citizenship
  • 31. 31  EQT meets or exceeds all federal, state and local regulations  Industry leading spill prevention plans and results  Supports the disclosure of frac fluid additives  Utilize multiple barriers to protect drinking water supplies  Pre-drilling water sampling within 2,500’ of drilling locations  Multi-well pads reduce surface impacts Drilling and Hydraulic Fracturing
  • 32. 32  Extensive reserves of natural gas  Proven ability to profitably develop our reserves  Committed to maximize shareholder value by:  Accelerating the monetization of our vast reserves  Operating in a safe and environmentally responsible manner  Funding with cash flow and debt capacity Investment Summary
  • 33. 33 Appendix
  • 34. 34 Capital Investment Summary Excludes acquisitions Midstream Production Distribution $1.1 $1.2 $1.4 $1.8 $2.3
  • 35. 35  EQT has 580,000 total Marcellus acres  Expect to develop in four areas for several years  Active areas represent 315,000 acres and 3,540 locations  EQT has 130,000 additional acres in PA & 135,000 additional acres in WV  Estimated 1,200 Mcfe EUR per lateral foot for wells drilled on additional acres Marcellus Play Acres Within Each Core Development Area Type curve and well cost data posted on www.eqt.com under investor relations 1Based on 4,800 laterals with lateral spacing estimates ranging from 500’ to 1,000’ 2EQT holds approximately 45,000 acres in the northern WV dry area – near-term development focused on 30,000 acres 3EQT holds approximately 160,000 acres in central PA – near-term development is focused on 80,000 acres EUR (Mcfe) / Lateral Foot Total Net Acres Total Net Undeveloped Acres Locations Utilizing Reduced Cluster Spacing Locations¹ Southwestern PA 2,088 115,000 93,000 90% 1,460 Northern WV - Wet 1 2,043 90,000 75,000 100% 1,060 Northern WV - Dry² 1,747 30,000 27,000 80% 300 Central PA3 1,375 80,000 72,000 100% 720 315,000 267,000 94% 3,540
  • 36. 36 Marcellus Play Type Curves by Area - 4,800’ lateral Type curve and well cost data posted on www.eqt.com under investor relations
  • 37. 37 Marcellus Economics IRR - Southwestern PA Realized Price PRICE ATAX IRR $4.00 79% $4.50 119% $5.00 171%
  • 38. 38 Marcellus Economics IRR - Northern WV – Wet Gas Area Realized Price PRICE ATAX IRR $4.00 111% $4.50 141% $5.00 176%
  • 39. 39 Marcellus Economics IRR - Central PA Realized Price PRICE ATAX IRR $4.00 19% $4.50 28% $5.00 38%
  • 40. 40 Marcellus Economics IRR - Northern WV – Dry Gas Area Realized Price PRICE ATAX IRR $4.00 26% $4.50 37% $5.00 50%
  • 41. 41 Upper Devonian Play Blended Type Curve - 4,800’ lateral Type curve and well cost data posted on www.eqt.com under investor relations
  • 42. 42 Upper Devonian IRR Realized Price PRICE ATAX IRR $4.00 32% $4.50 45% $5.00 59%
  • 43. 43 0% 20% 40% 60% 80% 100% 120% $3.00 $3.50 $4.00 $4.50 $5.00 Wellhead Wellhead After OpEx ATAX Huron Play IRR Realized Price PRICE ATAX IRR $4.00 35% $4.50 42% $5.00 50%
  • 44. 44 Marcellus Capacity Market Mix*EQT Capacity & Firm Sales
  • 45. 45 Ample Financial Flexibility to Execute Business Plan Moody’s Standard & Poor’s Fitch Long-term debt Baa3 BBB BBB- Outlook Stable Stable Stable Debt ratings Strong balance sheet Manageable debt maturities ($ thousands, except net debt / capital) June 30, 3014 $330,000 2,497,619 (1,274,265) $1,553,354 4,276,592 27%Net debt / capital Short-term debt Long-term debt Cash and cash equivalents Net debt (total debt minus cash) Total common stockholders' equity
  • 46. 46 Risk Management Hedging As of July 24, 2014 * The average price is based on a conversion rate of 1.05 MMBtu/Mcf ** July through December *** For 2016, the Company also has a natural gas sales agreement for approximately 35 Bcf that includes a NYMEX ceiling price of $4.88 per Mcf
  • 47. 47 Price Reconciliation (a)NGLs and crude oil were converted to Mcfe at the rate of six Mcfe per barrel for all periods. Information for the three and six months ended June 30, 2013 has been recast to reflect this conversion rate.
  • 48. 48 Per Unit Operating Expenses (a) NGLs and crude oil were converted to Mcfe at the rate of six Mcfe per barrel for all periods. Information for the three and six months ended June 30, 2013, has been recast to reflect this conversion rate.
  • 49. 49 Appendix Non-GAAP Reconciliation (millions) 2008 2009 2010 2011 2012 2013 Midstream operating income $120 $154 $179 $417 $237 $329 Add: depreciation and amortization 35 53 62 57 65 75 Less: gains on dispositions – – – 203 – 20 Less: Big Sandy and Langley 23 32 31 14 – – Adjusted Midstream EBITDA $132 $175 $210 $257 $302 $384 EQT Corporation Adjusted Midstream EBITDA