U.S. Gas Producer EQT Explores Sale of $3 Billion Worth of Assets
EQT, a US-based natural gas production company, is reportedly contemplating divesting minority stakes in oil and gas assets in Pennsylvania to raise more than $3 billion. Sources familiar with the matter informed Reuters that EQT is collaborating with an undisclosed investment bank to facilitate the sale of non-operating interests in wells located in Pennsylvania’s Marcellus shale formation.
The assets under consideration for sale are spread across Northeast Pennsylvania and are currently operated by Chesapeake Energy. These properties collectively have a current production capacity of around 700 million cubic feet per day. EQT presently owns a 25% non-operating interest in these assets, with other parties also holding stakes.
The potential divestiture involves assets acquired by EQT as part of its $3 billion takeover of Alta Resources in 2021. However, sources indicate that EQT may choose not to proceed with a sale deal.
The potential sale of minority stakes in oil and gas assets in Pennsylvania is part of EQT’s strategy to reduce its debt, which currently stands at $5.9 billion, and enhance shareholder returns. The move aligns with a broader trend of consolidation in the US energy sector, with major players like Exxon Mobil and Chevron revealing acquisitions exceeding $100 billion in total over the last two months.
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EQT had previously made acquisitions earlier in the year, including upstream assets from THQ Appalachia I (Tug Hill) and gathering and processing assets from THQ-XcL (XcL Midstream). These transactions involved entities backed by equity commitments from funds managed by private equity firm Quantum Energy Partners.
In September 2023, EQT entered into an agreement with Commonwealth LNG for liquefaction services at a proposed liquefied natural gas export facility in Cameron, Louisiana, with a planned capacity of 9.3 million tonnes per annum.
