EQT swaps onshore Marcellus shale assets with Equinor plus $500 million
(WO) – Equinor and EQT Corporation have agreed to swap Equinor’s operated position in the Marcellus and Utica shale formations in Ohio for a stake in EQT’s non-operated interest in the Northern Marcellus formation.
Equinor will sell 100% interest in and operatorship of its onshore asset in the Appalachian basin, located in southeastern Ohio, in exchange for 40% of EQT’s non-operated working interest in the Northern Marcellus shale formation in Pennsylvania.
The assets EQT is receiving include:
- Roughly 26,000 net acres in Monroe County, Ohio, with 2025E net production of approximately135 MMcfd, directly offsetting EQT-operated acreage.
- Roughly 10,000 net acres in Lycoming County, Pennsylvania, with 2025E net production of approximately15 MMcfd in existing EQT-operated assets.
- The remaining 16.25% ownership in EQT-operated gathering systems servicing core operated acreage in Lycoming County, Pennsylvania.
A gas buy-back agreement whereby Equinor will purchase gas from EQT at a premium to in-basin pricing through the first quarter of 2028
Equinor will pay a cash consideration of $500 million to EQT to balance the overall transaction, swapping for resources that contribute to growing cashflows and further reducing CO2 emissions intensity in the international portfolio.
Following the transaction, Equinor will increase its average working interest from 15.7% to 25.7% in certain Chesapeake-operated Northern Marcellus gas units. To cover pre-existing gas sales commitments, Equinor will enter a gas buy-back agreement with EQT.
“With this transaction, we continue to high-grade the U.S. portfolio and improve profitability by strengthening our gas position in the most robust part of the Appalachian basin. These assets are well positioned to leverage anticipated positive developments in the U.S. gas market,” said Philippe Mathieu, executive vice president for Exploration and Production International at Equinor.
“The proposed swap improves portfolio robustness with an expected reduction in well break-evens and upstream carbon intensity. This also means that we have now fully exited all operated positions onshore US,” Mathieu continued.
EQT President and CEO Toby Z. Rice stated, "This transaction marks an extremely positive start to our divestiture program, bringing in over $1.1 billion of value, including synergies and development plan optimization, for 40% of our non-operated assets, while retaining gas price upside. We plan to opportunistically divest the remaining portion of our non-operated assets in Northeast Pennsylvania and have tremendous confidence in being able to achieve our de-leveraging goals."
Since 2020, Equinor’s U.S. business has recorded $11 billion in earnings. Prior to this transaction, the Appalachian basin operated position was the last remaining operatorship held by Equinor in the US onshore.
EQT Corporation is the largest producer of natural gas in the U.S., with operations in Pennsylvania, West Virginia and Ohio.
