EQT Corp., the Lower 48’s largest natural gas producer, said Tuesday it would acquire all of Chevron Corp.’s Appalachian assets in the Marcellus Shale for $735 million.
Expected to be completed by year’s end, the sale includes 450 MMcfe/d of production, 335,000 net acres, 100 wells in progress, two water systems and associated infrastructure in Pennsylvania and West Virginia.
“This acquisition is a natural bolt-on extension of EQT’s dominant position in the core of the southwest Marcellus,” said CEO Toby Rice. The purchase price is underpinned by proved developed producing reserves that “provide material upside to the company.”
Appalachian pure-play EQT plans to finance the deal with cash on hand, debt and capital market transactions, including an offering of 20 million shares of common stock.
Rice took over the company last year and the management team has been focused on cutting costs and finding more efficiencies. The Chevron deal had been rumored since last month and comes days after Bloomberg reported that EQT proposed a takeover of Appalachian rival CNX Resources Corp.
EQT has been actively consolidating in the basin for a few years. Since 2016, it has acquired Rice Energy Inc., Trans Energy Inc., and assets from Stone Energy Corp. and Equinor ASA, among others.
Chevron indicated late last year that it would sell its Appalachian assets amid slumping commodity prices. Chevron entered the basin in 2010 with the $3.2 billion acquisition of Atlas Energy Inc.
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