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Scotia Howard Weil Annual Energy Conference – EQT Corp

EQT Corp · Mar 25, 2019 · 33 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. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 1
    EQT Corporation New Company, New Leadership, New Focus Scotia Howard Weil 47th Annual Energy Conference March 25, 2019
  2. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 2
    EQT Has Transformed Into the Leading U.S. Pure Play Natural Gas Producer New company, new leadership, new focus 2018 Transformation 2019 and Beyond d Reconstituted World Class 15 to 20 year drilling inventory Management and Board…
  3. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 3
    Measurable and Transparent Progress in Executing Our Plan Action Item Measure Timeline Board Added four new independent directors Q4 2018 Enhancements Created Operating & Capital Efficiency Board Committee Reconstituted New…
  4. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 4
    Focused on Delivering Results and Sustainable Free Cash Flow Q4 2018 Q1 2019 Delivering 135 MM 150 MM Adjusted Free Cash Flow(1) Annual cost savings identified Results Realizing Efficiencies + vs. 100 MM Guidance Driving Down…
  5. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 5
    Announced Industry Veteran Chief Operating Officer Career driving strong results at leading shale-focused upstream energy companies Proven track record of enhancing well productivity, driving down costs, and increasing efficiencies…
  6. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 6
    Management and Board Aligned to Deliver Efficiencies and Free Cash Flow Focused on driving cost reductions and free cash flow from our world-class asset base Transparency Accountability Senior Management focused on cost reductions,…
  7. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 7
    World-Class Asset Base Large-scale position in the core of the Appalachian Basin EQT Acreage Overlays the SW Marcellus Core Market Cap(1) 4.9 B Utica Cumulative SW Marcellus (2) Production Heat Map Enterprise Value 10.1 B Cumulative…
  8. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 8
    2019 Plan Supports Near-Term Free Cash Flow Approximately 300-400 MM of adjusted free cash flow in 2019(1) Net Development Activity (Turned in Line) Operational and Financial Detail 2019E Sales Volumes (Bcfe) 1,470 1,510 2019E:…
  9. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 9
    Detailed 2019 Development and Capital Plan Enhanced transparency, accountability and results 160 14,000 Average Lateral Length (ft.) 140 13,000 147 12,000 120 126 Net Well Count 11,000 100 10,000 100 80 91 9,000 60…
  10. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 10
    2019 Operational Efficiencies Strong 4Q18 and 1Q19 operational performance underscores this teams ability to achieve and surpass targets Drilling Operations Highlights Completion Operations Highlights 80% of 2019 wells 14,000…
  11. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 11
    5-Year Financial and Operating Plan Generates cumulative adjusted free cash flow of 2.9 B(1) 160 15,000 140 Average Lateral Length (ft.) 14,000 120 13,000 Net Well Count 100 12,000 80 11,000 60 10,000 40 20 9,000 0…
  12. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 12
    Compelling Free Cash Flow Story Early 2019 cost reductions positively impact 5-Year cumulative adjusted free cash flow(1) Adjusted Free Cash Flow(1) and Adjusted Free Cash Flow Yield(1,2) 2019-2023 Cumulative Adjusted FCF…
  13. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 13
    Target 10% Initiative Tracking progress and line-of-sight to further cost savings Cost Reduction Initiatives Progress on Target 10% Initiative Jan 2019: 100 MM identified 800 (Million) and implemented (included in base plan) 600 Feb…
  14. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 14
    Delivering Development Efficiencies and Optimization Increasing lateral lengths and optimizing spacing generates higher single-well returns Increasing lateral well spacing optimizes Core PA Marcellus - 13,000' Lateral reservoir…
  15. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 15
    The Evolution of Well Spacing and Asset Development Empirical data and deterministic modeling drive design modifications Empirical Evidence Deterministic Modeling Double-bounded Single-bounded Unbounded EUR (MMcf/ft) Statistical…
  16. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 16
    Test Results Support Development Strategy Wider spacing and larger fracs optimize development Testing has been performed across our core acreage portfolio, supporting model predictions Results demonstrate the value of optimizing…
  17. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 17
    Technology Platform Driving Performance Efficiencies Transforming the way we operate to drive efficiencies and maximize asset value Functions Benefits 24/7 monitoring of Provides consistency and operational activities operational…
  18. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 18
    Technology Platform Driving Performance Efficiencies Using data, science and analytics to make better, faster decisions Functions Benefits Water Advanced logistics and resource Streamlines EQTs complex water Scheduling scheduling…
  19. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 19
    Financial Strength Flexibility to further reduce leverage and return capital to shareholders Leverage EQT vs. Marcellus Peers(1,4) Monetization of ETRN stake 3.2x Can reduce leverage(1) from 2.2x to 1.7x 2.2x 2.2x 2.4x 2.5x…
  20. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 20
    Environmental, Health and Safety The right thing to do Environment Stewardship(1) Safety In the Community Founding partner of the Center for Employees participated in 13,000 hours of EQT and the EQT Foundation a Responsible Shale…
  21. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 21
    Strong Fundamentals In Place to Deliver Exceptional Value to Shareholders World-class asset base, sustainable free cash flow and financial strength Leading U.S. natural gas producer at 4.0 Bcfe per day World-Class 15-20 years drilling…
  22. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 22
    Appendix
  23. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 23
    EQT as a Leading Environmental Steward Long-term, sustainable environmental practices aligned with investors and stakeholders Board and Environmental Methane Water Management Oversight Collaborations Emissions Initiatives…
  24. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 24
    2019 Guidance 300-400 MM of adjusted free cash flow(1) Q1 2019 Full-Year 2019 Production Total production sales volume (Bcfe) 360 - 380 1,470 - 1,510 Liquids sales volume, excluding ethane (Mbbls) 1,985 - 2,085 8,200 - 8,400 Ethane…
  25. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 25
    Firm Transportation Portfolio Provides access, stability and opportunity Diversity of delivered markets provides significant commercial optionality Portfolio offers price stability by accessing 933,000 933,000 Dth/d Dth/d EQT…
  26. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 26
    Risk Management NYMEX Hedge position as of March 15, 2019 2019* 2020 2021 2022 2023 Swaps Volume (MMDth) 562 565 298 136 61 Average Price (/dth) 2.91 2.82 2.78 2.75 2.74 Calls - Net Short Volume (MMDth) 260 171 37 22 7 Average…
  27. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 27
    Unit Cost Comparison FY 2018(1) Peer-leading unit costs for LOE, G&A Lease Operating Expense (/Mcfe)(2) Selling, General & Administrative (/Mcfe) Peer Mean (excl Peer 5): 0.15 Peer Mean: 0.18 0.19 0.93 0.26 0.17 0.14 0.19…
  28. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 28
    Non-GAAP Financial Measure Adjusted EBITDA As used in this presentation, adjusted EBITDA is defined as net income from continuing operations, plus interest expense, income tax expense, depreciation and depletion, amortization of…
  29. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 29
    Non-GAAP Financial Measure Reconciliation of Adjusted EBITDA The table below reconciles adjusted EBITDA with net (loss) income from continuing operations, the most comparable financial measure as calculated in accordance with GAAP, as…
  30. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 30
    Non-GAAP Financial Measure Adjusted Operating Cash Flow and Adjusted Free Cash Flow As used in this presentation, adjusted operating cash flow is defined as EQTs net cash provided by operating activities less changes in other assets and…
  31. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 31
    Non-GAAP Financial Measure Reconciliation of Adjusted Operating Cash Flow and Adjusted Free Cash Flow The table below reconciles adjusted operating cash flow and adjusted free cash flow with net cash provided by operating activities,…
  32. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 32
    Non-GAAP Financial Measure EBITDA Attributable to Discontinued Operations As used in this presentation, EBITDA attributable to discontinued operations is a non-GAAP supplemental financial measure defined as net income from discontinued…
  33. Scotia Howard Weil Annual Energy Conference – EQT Corp – slide 33
    Non-GAAP Financial Measure Adjusted SG&A per Unit Adjusted SG&A per unit is a non-GAAP supplemental financial measure that is presented because it is an important measure used by EQTs management to evaluate period-to-period comparisons…

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