EQT Provides Preliminary Second Quarter 2019 Financial and Operational Results and Announces Additional Savings under Target 10% Initiative

Second Quarter Sales Volumes Expected to be at High End of Guidance

Operational Efficiencies Expected to Drive Incremental $25 Million
Reduction in Annual Capital Expenditures

Incremental Savings Bring Total Annual Cost Savings Identified by
EQT’s New Management Team since November 2018 to $175 Million

Capital Expenditure Reductions Raise Expected 2019 to 2023 Cumulative
Adjusted Free Cash Flow (a non-GAAP measure)
(1) to
$3.0 Billion

Delivering Continued Positive Operational Results with Improvements
in Rig and Frac Crew Efficiencies

PITTSBURGH–(BUSINESS WIRE)–EQT Corporation (NYSE: EQT) today provided preliminary financial and
operational results for the second quarter 2019 and announced additional
savings under its Target 10% Initiative.

In the second quarter, EQT continued to drive operational efficiencies,
building on the Company’s progress in the prior two quarters. Through
May 31, 2019, EQT achieved the following operational results:

  • Continued improvements in drilling days / 1,000 feet, which decreased
    8% compared to the first quarter 2019.
  • Additional efficiencies in frac stages / crew, with a 20% efficiency
    gain compared to the first quarter 2019.
  • Continued advancements in frac plug drill-out days, with a 14%
    increase in plugs drilled per day compared to the first quarter 2019.
  • During the second quarter, the Drilling Team will surpass 3,000,000
    feet drilled 100% remotely through the Company’s proprietary real-time
    operations center. EQT was one of the first U.S. land based operators
    to drill 100% remotely, demonstrating the Company’s innovative and
    technology-driven vision and approach to industry changing development.

Using fewer resources to deliver the Company’s targeted 2019 activity
levels, EQT expects approximately $25 million of additional annual
capital expenditure savings under the Target 10% Initiative. With the
recently identified incremental savings, EQT’s new management has
identified $175 million in annual cost savings to date and now expects
adjusted free cash flow(1) of over $3.0 billion through 2023,
increasing to $3.4 billion if Target 10% is fully realized.

Based on the Company’s performance to date, EQT also expects the
following financial results for the second quarter 2019:

  • Sales volumes at the high end of the Company’s guidance of 355-375
  • Capital expenditures in line with expectations; and
  • Adjusted free cash flow(1) improvement of $25 million over
    the previously provided guidance, excluding the impact of litigation
    reserves and proxy-related costs.

We have incredible momentum and are firing on all cylinders at EQT. We
are on track to deliver strong financial and operational performance,
including second quarter production volumes at the high end of guidance
and continued improvements in operating efficiencies,” said Rob McNally,
President and Chief Executive Officer. “Importantly, the significant
operational improvements we drove through the end of May will enable us
to achieve the same level of activity with fewer resources, reducing
total 2019 capital expenditures by approximately $25 million.”

We are delivering on the vast potential of EQT’s world-class asset
base, and our operational efficiencies are translating into meaningful
costs savings and accelerating free cash flow growth,” said Gary Gould,
Chief Operating Officer. “EQT is one of the premier natural gas
producers in North America, and we are using advanced technologies,
real-time analytics and more efficient processes to deliver results with
fewer resources and less capital. Each and every day, EQT is moving
closer to becoming the most efficient and lowest-cost operator in our

(1) Adjusted free cash flow is a non-GAAP financial measure. See the
Non-GAAP Disclosures section below for definition and pricing
assumptions, including reasons why the Company is unable to provide a
projection of its 2019 net cash provided by operating activities, the
most comparable financial measure calculated in accordance with GAAP, to
projected adjusted free cash flow.

About EQT Corporation:

EQT Corporation is a natural gas production company with emphasis in the
Appalachian Basin and operations throughout Pennsylvania, West Virginia
and Ohio. With 130 years of experience and a long-standing history of
good corporate citizenship, EQT is the largest producer of natural gas
in the United States. As a leader in the use of advanced horizontal
drilling technology, EQT is committed to minimizing the impact of
drilling-related activities and reducing its overall environmental
footprint. Through safe and responsible operations, EQT is helping to
meet our nation’s demand for clean-burning energy, while continuing to
provide a rewarding workplace and support for activities that enrich the
communities where its employees live and work. Visit EQT Corporation at www.EQT.com;
and to learn more about EQT’s sustainability efforts, please visit https://csr.eqt.com.

EQT Management speaks to investors from time to time and the analyst
presentation for these discussions, which is updated periodically, is
available via the Company’s investor relationship website at ir.eqt.com.

Cautionary Statements

This news release contains certain forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934, as
amended, and Section 27A of the Securities Act of 1933, as amended.
Statements that do not relate strictly to historical or current facts
are forward-looking. Without limiting the generality of the foregoing,
forward-looking statements contained in this news release specifically
include the expectations of plans, strategies, objectives and growth and
anticipated financial and operational performance of the Company and its
subsidiaries, including guidance regarding projected adjusted free cash
flow, sales volumes and capital expenditures; and anticipated cost
savings. These forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially from
projected results. Accordingly, investors should not place undue
reliance on forward-looking statements as a prediction of actual
results. The Company has based these forward-looking statements on
current expectations and assumptions about future events, taking into
account all information currently available to the Company. While the
Company considers these expectations and assumptions to be reasonable,
they are inherently subject to significant business, economic,
competitive, regulatory and other risks and uncertainties, many of which
are difficult to predict and beyond the Company’s control. The risks and
uncertainties that may affect the operations, performance and results of
the Company’s business and forward-looking statements include, but are
not limited to, those set forth under Item 1A, “Risk Factors,” of the
Company’s Form 10-K for the year ended December 31, 2018, as filed with
the SEC and as updated by subsequent Form 10-Qs filed by the Company,
and those set forth in the other documents the Company files from time
to time with the SEC.

Any forward-looking statement speaks only as of the date on which such
statement is made, and the Company does not intend to correct or update
any forward-looking statement, whether as a result of new information,
future events or otherwise, except as required by law.


Adjusted Free Cash Flow

Adjusted free cash flow is defined as the Company’s net cash provided by
operating activities less changes in other assets and liabilities, less
accrual-based capital expenditures attributable to continuing
operations. Adjusted free cash flow is a non-GAAP supplemental financial
measure that the Company’s management and external users of its
consolidated financial statements, such as industry analysts, lenders
and ratings agencies use to assess the Company’s liquidity. The Company
believes that adjusted free cash flow provides useful information to
management and investors in assessing the impact of the Company’s
ability to generate cash flow in excess of capital requirements and
return cash to shareholders. Adjusted free cash flow should not be
considered as an alternative to net cash provided by operating
activities or any other measure of liquidity presented in accordance
with GAAP.

The Company has not provided projected net cash provided by operating
activities or a reconciliation of projected adjusted free cash flow to
projected net cash provided by operating activities, the most comparable
financial measure calculated in accordance with GAAP. The Company is
unable to project net cash provided by operating activities for any
future period because this metric includes the impact of changes in
operating assets and liabilities related to the timing of cash receipts
and disbursements that may not relate to the period in which the
operating activities occurred. The Company is unable to project these
timing differences with any reasonable degree of accuracy without
unreasonable efforts such as predicting the timing of its and customers’
payments, with accuracy to a specific day, months in advance.
Furthermore, the Company does not provide guidance with respect to its
average realized price, among other items, that impact reconciling items
between net cash provided by operating activities and adjusted operating
cash flow and adjusted free cash flow, as applicable. Natural gas prices
are volatile and out of the Company’s control, and the timing of
transactions and the income tax effects of future transactions and other
items are difficult to accurately predict. Therefore, the Company is
unable to provide projected net cash provided by operating activities,
or the related reconciliation of projected adjusted free cash flow to
projected net cash provided by operating activities, without
unreasonable effort. Projected 2019 adjusted free cash flow is based on
average NYMEX natural gas price (April to December) of $2.79 per MMbtu
as of March 31, 2019. For the period 2020 through 2023, projected
adjusted free cash flow is based on average NYMEX natural gas price of
$2.85 per MMbtu for Henry Hub and ($0.45) local basis.

Important Information

EQT Corporation (the “Company”) filed a definitive proxy statement and
associated GOLD universal proxy card with the Securities and Exchange
Commission (the “SEC”) on May 22, 2019 in connection with the
solicitation of proxies for the Company’s 2019 Annual Meeting of
Shareholders (the “2019 Annual Meeting”). Details concerning the
nominees for election to the Company’s Board of Directors at the 2019
Annual Meeting are included in the definitive proxy statement. BEFORE
CONTAIN IMPORTANT INFORMATION. Investors and shareholders can obtain a
copy of the relevant documents filed by the Company with the SEC,
including the definitive proxy statement, free of charge by visiting the
SEC’s website, www.sec.gov.
Investors and shareholders can also obtain, without charge, a copy of
the definitive proxy statement, when available, and other relevant filed
documents by directing a request to Blake McLean, Senior Vice
President, Investor Relations and Strategy of EQT Corporation, at [email protected],
by calling the Company’s proxy solicitor, Innisfree M&A Incorporated,
toll-free, at 877-687-1866, or from the Company’s website at https://ir.eqt.com/sec-filings.


Analyst inquiries:
Blake McLean – Senior Vice President,
Investor Relations and Strategy
[email protected]

Media inquiries:
Michael Laffin – Vice President,
[email protected]

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