EQT will sell Jupiter Gathering System for $1.18 billion - WOWK 13 Charleston, Huntington WV News, Weather, Sports

EQT will sell Jupiter Gathering System for $1.18 billion

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EQT Corporation announced April 30 EQT Midstream Partners LP has agreed to acquire EQT’s Jupiter natural gas gathering system for $1.18 billion.

Through the agreement, EQT will receive $1.12 in cash and $59 million in common and general partner units.

The partnership also will fund $182 million in expansion projects related to Jupiter and two additional announcements from EQT include the execution of an agreement to exchange assets with Range Resources Corporation and authorization of EQT share repurchase.

The Jupiter system groups EQT’s Marcellus production in portions of Greene and Washington counties in Pennsylvania. It consists of about 35 miles of natural gas gathering pipeline and about 21,300 horsepower of compression. Jupiter has a total of 970 MMcf per day of pipeline capacity and six interconnects with the partnership’s transmission and storage systems. The Jupiter assets are supported by a gathering agreement with EQT that includes 10-year firm capacity reservation commitments.

The partnership will complete several expansion projects related to Jupiter throughout 2014 and 2015. The planned 2014 expansions will add about 350 MMcf per day of compression capacity with an in-service date anticipated for the fourth quarter 2014. The 2015 expansion will add approximately 200 MMcf per day of compression capacity.

The partnership also will install about 20 miles of pipeline, with a total cost of compression and gathering expansion projects anticipated to be about $182 million.

EQT currently has about 48,000 net acres surrounding Jupiter, including about 31,000 undeveloped net acres. A total of 206 Marcellus and nine Upper Devonian wells were drilled in the Jupiter service area as of March 31, 2014. Jupiter’s average daily gathered volume for the first quarter 2014 was about 595 MMcf per day.

As part of an asset exchange agreement with Range Resources, EQT will receive about 73,000 net acres in the Permian Basin, most of which is held by production, along with approximately 900 producing wells in two Texas counties. EQT expects to drill two horizontal wells on its newly acquired acreage during 2014 and has tentative plans to drill between 20 and 30 horizontal wells in 2015.

Range will receive EQT’s interest in 138,000 net acres and the supporting gathering system in the Nora Field of Virginia in exchange, giving Range 100 percent ownership of Nora. Range will receive $145 million in cash in exchange.

EQT also announced April 30 its Board of Directors approved a share repurchase authorization of up to 1 million shares. EQT may repurchase shares of its outstanding common stock in the open market or in privately negotiated transactions and may do so over a period of time and in a series of transactions.