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EQT Corp. First Quarter 2022 Results

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   |    Friday,April 29,2022

EQT Corp. announced financial and operational results for the first quarter 2022.

First Quarter 2022 Highlights:

  • Sales volumes of 492 Bcfe
  • Total per unit operating costs of $1.33 per Mcfe
  • Capital expenditures of $310 MM or $0.63 per Mcfe
  • Net cash provided by operating activities of $1,021 MM; free cash flow(1) of $580 MM
  • Achieved investment grade credit ratings from Fitch and S&P
  • Repaid $569 MM of 2022 senior notes
  • Repurchased 8.5 MM shares for $200 MM; 9.9 MM shares repurchased to date
  • Total shareholder returns of $816 MM via debt repayment, share buybacks and dividend

President and CEO Toby Rice stated, "We achieved several significant milestones during the first quarter, including attaining investment grade credit ratings, paying down all of our 2022 senior note maturities, repurchasing a significant amount of shares under our buyback authorization and returning cash to our shareholders through our recently instated base dividend. Given the positive fundamental backdrop for natural gas prices, we are raising the mid-point of our 2022 free cash flow(1) outlook by approximately 50% to $2.35 billion.

Rice continued, "We also unveiled our Unleash U.S. LNG plan, which has been met with resoundingly positive feedback from our stakeholders. Growing U.S. LNG exports is the largest green initiative on the planet, with the ability to lower emissions at a rate equal to the combined impact of every domestic mainstream green solution while providing energy security to the world. EQT is uniquely positioned to play a key role in meeting global energy demand growth as the largest natural gas producer in the U.S. with an investment grade balance sheet, multi-decade inventory and a leading emissions profile. We have made additional progress on our ESG strategy this year and feel confident in our ability to achieve our emissions reduction goals by or before 2025. We will continue to demonstrate stewardship in delivering a sustainable energy source that meets the world's growing energy demands with affordable, reliable and clean natural gas."

1Q22 Results Overview

Sales volume growth reflects the Company's 2021 acquisition of Alta Resources (the Alta Acquisition). Average realized price increased for the three months ended March 31, 2022 compared to the same period in 2021 due to higher NYMEX prices and higher liquids prices, partly offset by lower cash settled derivatives and unfavorable differential.

Capital expenditures were $310 million, or $0.63 per Mcfe for the first quarter of 2022. The Company believes that total capital expenditures on a per Mcfe basis is an important measure of capital efficiency.

In 2022, the Company expects total sales volume of 1,950 - 2,050 Bcfe under a maintenance production program and expects capital expenditures of $1.300 - $1.450 billion, or $0.65 - $0.75 per Mcfe, excluding capital expenditures attributable to noncontrolling interests. During 2022, the Company plans to start phasing in its next generation well design that has been under development for the past year, which, based on initial results as part of its methodical science program, the Company believes has a high probability of further improving well productivity and rates of return across its asset base. Given the time required to develop wells that are part of the Company's large-scale combo-development model and the planned phased deployment of the new well design, the Company expects to have preliminary results of its investment by the end of 2022 and full visibility by late 2023 into early 2024.

Per Unit Operating Costs

The following presents certain of the Company's production-related operating costs on a per unit basis.


Three Months Ended

March 31,

Per Unit ($/Mcfe)





$ 0.65


$ 0.68









Lease operating expense (LOE)




Production taxes








Total per unit operating costs

$ 1.33


$ 1.31


Production depletion

$ 0.85


$ 0.90

Gathering expense decreased on a per Mcfe basis for the three months ended March 31, 2022 compared to the same period in 2021 due primarily to the lower gathering rate structure on the assets acquired in the Alta Acquisition.

SG&A expense increased on a per Mcfe basis for the three months ended March 31, 2022 compared to the same period in 2021 due primarily to higher long-term incentive compensation costs as a result of changes in the fair value of awards due to the increase in the price per share of the Company's common stock and higher litigation expense.


As of March 31, 2022, the Company had $26 million in credit facility borrowings and $425 million of letters of credit outstanding under its $2.5 billion credit facility.

As of March 31, 2022, total debt was $5.1 billion and net debt(1) was $5.0 billion, compared to $5.6 billion and $5.5 billion, respectively, as of December 31, 2021. During the first quarter of 2022, the Company made significant progress towards its deleveraging goals of reducing total debt by at least $1.5 billion by the end of 2023. The Company repaid all of its outstanding 2022 senior notes and reduced total debt and net debt(1) by $0.5 billion compared to December 31, 2021.



For 2022 (April 1 through December 31), 2023 and 2024, the Company has natural gas sales agreements for approximately 14 MMDth, 88 MMDth and 11 MMDth, respectively, that include average NYMEX ceiling prices of $3.17, $2.84 and $3.21, respectively.

The Company entered into 455 MMDth per day of NYMEX swaps at a weighted average price of $6.05 that offset existing NYMEX swaps related to the first quarter of 2023 with a weighted average price of $2.53. These positions have been excluded from the table above.

The Company has also entered into transactions to hedge basis. The Company may use other contractual agreements from time to time to implement its commodity hedging strategy.

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