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APRIL 2015 ANALYST PRESENTATION – EQT Corp

EQT Corp · Apr 20, 2015 · 40 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 1
    Analyst Presentation April 2015
  2. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 2
    Key Investment Highlights Extensive reserves of natural gas* 10.7 Tcfe Proved; 22 years R/P 42.8 Tcfe 3P; 87 years R/P 53 Tcfe Total Resource Potential; 108 years R/P Proven ability to profitably develop our reserves 23%…
  3. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 3
    Leading Appalachian E&P Company 2014 Operating Income of 853.4 million 9,100 pipeline miles 10.7 Tcfe proved reserves 3.4 MM acres As of 12/31/14 6
  4. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 4
    Production By Play Marcellus Shale drilling driving growth 1,800 Marcellus 1,600 Huron Other 1,400 1,200 Production MMcf/d 1,000 800 600 Began horizontal drilling 400 200 0 2006 2007 2008 2009 2010 2011 2012…
  5. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 5
    Reserves By Play Proved Reserve Growth 42.8 Tcfe 3P reserves (as of December 31, 2014) 12,000 Upper Devonian Other 10,739 455 10,000 Huron 760 Marcellus 8,348 1,240 215 8,000 861 Huron 11.9 Bcfe 1,316 6,004 6,000…
  6. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 6
    Marcellus Play Near term development focused in four areas Central PA 600,000 EQT acres 86% NRI / 80% HBP 28% wet 23.3 Tcfe 3P Southwestern PA 31 Tcfe total resource potential 141 wells in 2015 Northern WV (Dry) Northern…
  7. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 7
    Marcellus Play Southwestern PA Oliver West Pad Prolific dry gas region 7 wells 3,986 Avg. Lateral Length per well 61.7 Bcfe Total Pad EUR 140,000 EQT acres Kevech Pad 6 wells 1,800 locations 2,970 Avg. Lateral Length per…
  8. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 8
    Marcellus Play Northern West Virginia Wet Gas Area Enhanced economics from liquids uplift BIG 190 Pad 8 wells 5,657 Avg. Lateral Length per well 100.0 Bcfe Total Pad EUR 90,000 EQT acres 1,070 locations 178 wells online** 45…
  9. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 9
    Marcellus Play Central Pennsylvania Early stages of acreage delineation 80,000 EQT acres Frano Pad 3 wells 4,409 Avg. Lateral Length per well 730 locations 20.4 Bcfe Total Pad EUR 72 wells online* 9 wells in 2015 4,800 foot…
  10. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 10
    Marcellus Play Northern West Virginia Dry Gas Area EQTs newest development area GRT 26 Pad 2 wells 3,270 Avg. Lateral Length per well 17.7 Bcfe Total Pad EUR 32,000 EQT acres 335 locations 50 wells online* 8 wells in 2015…
  11. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 11
    Marcellus Economics IRR - Blended Marcellus Development Areas 350% Wellhead After OpEx After Tax 300% PRICE ATAX IRR 2.50 12% 3.00 25% 250% 3.50 42% 4.00 63% 4.50 91% 200% 150% 100% 50% 0% 2.50 3.00 3.50 4.00 4.50…
  12. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 12
    Upper Devonian Play Developed in conjunction with Marcellus 170,000 near-term testing & development EQT acres 2,000 locations 32 wells online* 40 wells in 2015 4,800 foot laterals 83 acre spacing 6.1 Bcfe EUR / well 1,274…
  13. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 13
    Dry Utica / Point Pleasant Potential Targeting deep, high pressure rock beneath existing development areas 400,000 EQT acres 3,000 locations 5 wells in 2015 13,500 feet deep 12 - 17 MM / well EQT acreage 16
  14. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 14
    Industry Leading Cost Structure 7 3-year F&D (all sources) 6 5 Mean = 2.66 4 0.73 /Mcfe 3 2 1 0 RICE SWN MDU WLL COG CNX QEP AR RRC XCO EOG NBL SM CXO CHK EGN…
  15. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 15
    EQT Corporation Midstream Overview Consolidated Transmission & Storage* 3.5 Bcf/d current capacity 47 Bcf gas storage capacity Gathering* 2 Bcf/d capacity Formed MLP in 2012 (NYSE: EQM) 600 700 EQT Corporation Adjusted EQT…
  16. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 16
    EQT Corporation Midstream Marcellus Midstream Assets Allegheny Valley Allegheny Tioga Valley 65 MMcf/d Connector Connector 200-mile FERC pipeline Longhorn 130 MMcf/d 450 MMcf/d capacity 30MM CAPEX in 2015 Terra 80 MMcf/d 40 MM…
  17. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 17
    EQT Midstream Partners, LP (NYSE: EQM) Transmission & Storage 3.0 Bcf/d current capacity 700 mile FERC-regulated interstate pipeline Jupiter 32 Bcf of gas storage capacity Gathering System Jupiter Gathering System Northern West…
  18. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 18
    EQT Midstream Partners, LP Northern WV Marcellus Gathering System EQM acquired in March 2015 Assets Wet Gas Header 70 miles of gathering pipe Pipeline (WG-100) Nine compressor units Mercury 25,000 HP of compression 30-mile wet…
  19. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 19
    EQT Midstream Partners, LP Growth Projects Ohio Valley Connector 36-mile FERC regulated pipeline to connect transmission in West Virginia to Clarington, OH Mid-2016 in-service 1 Bcf/d capacity 650 MMcf/d contracted under firm…
  20. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 20
    Corporate Citizenship 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…
  21. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 21
    Drilling and Hydraulic Fracturing Committed to operate in accordance with federal, state and local regulations Industry leading spill prevention plans and results Supports the disclosure of frac fluid additives Utilize multiple…
  22. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 22
    Investment Summary Extensive reserves of natural gas Proven ability to profitably develop our reserves 23% production sales volume growth forecasted in 2015 Strong liquidity position Committed to maximize shareholder value by:…
  23. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 23
    Appendix 26
  24. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 24
    Liquids Volume Growth and Marcellus Impact Liquids Volume Growth Marcellus Liquids Price Impact (1200 Btu Gas) NGLs (1.6 Gal/Mcf) 10,000 Btu Premium 6.00 9,000 NYMEX 8,000 5.00 7,000 4.00 3.61 6,000 /Mcf 3.38 5,000…
  25. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 25
    Capital Investment Summary 1.9 1.9 1.6 1.2 1.3 Midstream Production Distribution Excludes acquisitions and EQT Midstream Partners, LP 28
  26. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 26
    Marcellus Play Acres Within Each Core Development Area EQT has 600,000 total Marcellus acres Expect to develop in four areas for several years Active areas represent 342,000 acres and 3,935 locations EQT has 123,000 additional acres…
  27. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 27
    Marcellus Play Type Curves by Area - 4,800 lateral Type curve and well cost data posted on www.eqt.com under investor relations 30
  28. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 28
    Marcellus Economics IRR - Southwestern PA 600% Wellhead After OpEx After Tax PRICE ATAX IRR 500% 2.50 18% 3.00 38% 3.50 67% 400% 4.00 109% 4.50 166% 300% 200% 100% 0% 2.50 3.00 3.50 4.00 4.50 Realized Price 31
  29. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 29
    Marcellus Economics IRR - Northern WV Wet Gas Area 450% Wellhead After OpEx After Tax 400% PRICE ATAX IRR 2.50 24% 350% 3.00 40% 3.50 59% 300% 4.00 82% 4.50 110% 250% 200% 150% 100% 50% 0% 2.50 3.00 3.50 4.00 4.50 Realized…
  30. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 30
    Marcellus Economics IRR - Central PA 90% Wellhead After OpEx After Tax 80% PRICE ATAX IRR 2.50 4% 70% 3.00 10% 3.50 17% 60% 4.00 26% 4.50 37% 50% 40% 30% 20% 10% 0% 2.50 3.00 3.50 4.00 4.50 Realized Price 33
  31. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 31
    Marcellus Economics IRR - Northern WV Dry Gas Area 160% Wellhead After OpEx After Tax 140% PRICE ATAX IRR 2.50 5% 3.00 12% 120% 3.50 21% 4.00 32% 100% 4.50 46% 80% 60% 40% 20% 0% 2.50 3.00 3.50 4.00 4.50 Realized…
  32. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 32
    Upper Devonian Play Blended Type Curve - 4,800 lateral Type curve and well cost data posted on www.eqt.com under investor relations 35
  33. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 33
    Upper Devonian IRR 160% Wellhead After OpEx After Tax 140% PRICE ATAX IRR 2.50 6% 3.00 14% 120% 3.50 24% 4.00 37% 100% 4.50 52% 80% 60% 40% 20% 0% 2.50 3.00 3.50 4.00 4.50 Realized Price 36
  34. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 34
    Marcellus Capacity EQT Capacity & Firm Sales Market Mix MDth/D 2,500 2015E 2016E TETCO M2 31-33% 19-21% 2,000 FIRM SALES (SHORTTERM) TETCO M3 34-36% 31-33% FIRM SALES (LONGTERM) TCO 9-10% 9-10% FIRM MIDWEST Midwest 9-10%…
  35. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 35
    Ample Financial Flexibility to Execute Business Plan EQT Debt ratings Moodys Standard & Poors Fitch Long-term debt Baa3 BBB BBB- Outlook Stable Stable Stable Strong balance sheet ( MM, except net debt / capital) March 31,…
  36. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 36
    Risk Management Hedging 2015** 2016*** 2017*** Fixed Price Total Volume (Bcf) 234 167 31 Average Price per Mcf* 4.00 4.14 4.27 Collars Total Volume (Bcf) 30 - - Average Floor Price per Mcf * 4.57 - - Average Cap Price per Mcf…
  37. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 37
    Price Reconciliation Three Months Ended March 31, in thousands (unless noted) 2015 2014 LIQUIDS NGLs: Sales volume (MMcfe) (a) 13,281 7,767 Sales volume (Mbbls) 2,214 1,295 Gross price (/Bbl) 22.14 55.71 Gross NGL sales 49,014 72,114…
  38. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 38
    Price Reconciliation (continued) TOTAL PRODUCTION Total net natural gas & liquids sales, including cash settled derivatives 602,541 642,213 Total sales volume (MMcfe) 145,198 106,123 Net natural gas & liquids price, including cash…
  39. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 39
    Per Unit Operating Expenses Three Months Ended UNIT COSTS March 31, 2015 2014 Production segment costs: (/Mcfe) LOE 0.11 0.14 Production taxes 0.10 0.16 SG&A 0.28 0.24 0.49 0.54 Midstream segment costs: (/Mcfe) Gathering and…
  40. APRIL 2015 ANALYST PRESENTATION – EQT Corp – slide 40
    Appendix Non-GAAP Reconciliation EQT Corporation Adjusted Midstream EBITDA (millions) 2010 2011 2012 2013 2014 Midstream operating income 179 417 237 329 384 Add: depreciation and amortization 62 57 65 75 87 Less: gains on…

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