EQT has agreed to acquire all of the membership interests in US shale operator Alta Resources Development’s upstream and midstream subsidiaries for about $2.92bn in a cash-cum-stock deal.
The deal gives 300,000 core net acres in the Marcellus Shale in the US to EQT, of which 98% is in production. Of these, 222,000 net acres are operated by Alta Resources.
Current net production of the acquired assets is one billion cubic feet of gas equivalent (Bcfe) per day, which is 100% dry gas.
The midstream assets being acquired include 482.8km of owned and operated midstream gathering systems and 161km long freshwater system with 255 million gallons of storage capacity.
EQT president and CEO Toby Rice said: “The acquisition of Alta’s assets represents an attractive entry into the Northeast Marcellus while accelerating our deleveraging path, providing attractive free cash flow per share accretion for our shareholders and adding highly economic inventory to EQT’s already robust portfolio.
“In addition to increasing our long-term optionality, we believe this transaction accelerates both our path back to investment grade metrics and our shareholder return initiatives. We look forward to applying our differentiated modern operating model to maximise the prolific value embedded in these premier assets.”
The consideration for the deal is made up of $1bn in cash and nearly 105 million shares of EQT worth around $1.92bn, which will be directly issued to Alta Resources Development’s shareholders.
The deal, which is subject to approval of EQT’s shareholders and other customary closing conditions, is anticipated to close in Q3 2021.
EQT is a natural gas production firm operating in the Appalachian Basin with a focus on the cores of the Marcellus and Utica shales.
In late 2020, the company signed a $735m deal to acquire the upstream and midstream assets of Chevron in the Appalachian Basin.
