Slide 1: Investor Presentation First Quarter 2023 Results
Investor Presentation First Quarter 2023 Results April 26, 2023 4/27/20 1 23 1
Slide 2: Cautionary Statements
Cautionary Statements The Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable and possible reserves that a company anticipates as of a given date to be economically and legally producible and deliverable by applicat
Slide 3: Performing For All Stakeholders
Performing For All Stakeholders Solid execution leads to robust free cash flow KEY RESULTS Q1 2023 RECENT HIGHLIGHTS › Generated $774 MM of free cash flow(1) in Q1 459 Total Sales Volumes Bcfe › Production 2% above mid-point of guidance range, CAPEX 2% below the low-end of guidance $4.11 Average Rea
Slide 4: The Premier Appalachian Natural Gas Producer
The Premier Appalachian Natural Gas Producer Combination of scale, premier assets, and responsible development PURE-PLAY APPALACHIAN PRODUCER EQT AT A GLANCE (NYSE: EQT) NEPA MARCELLUS ~0.9 Bcf/d $11.8 B Market Cap(1) #1 ~200k core net acres Producer of natural gas in the United States(5) OH UTICA $
Slide 5: Robust Long-Term Free Cash Flow Generation
Robust Long-Term Free Cash Flow Generation Free cash flow outlook highlights attractive value proposition 2023 – 2027E CUMULATIVE FCF OUTLOOK(1,2) >105% >80% $B of market cap(3) of enterprise value(3) >$12 B generated in free cash flow(1,2) in 2023-2027E Factors Driving Improved Free Cash Flow Gener
Slide 6: Executing on "All of the Above" Shareholder Return Framework
Executing on “All of the Above” Shareholder Return Framework Balanced framework focused on optimizing long-term risk-adjusted value creation CAPITAL ALLOCATION FRAMEWORK 2023 YTD CAPITAL RETURNED TO SHAREHOLDERS $4.0 B IN ABSOLUTE DEBT RETIREMENT $ MM $4,000 MM Target Senior Note Retirements Share R
Slide 7: Operational Execution Returning to Peak Levels
Operational Execution Returning to Peak Levels Drilling setting new efficiency records, while completions are returning to peak efficiency levels AVERAGE FRAC CREW PUMPING HOURS DRILLOUT COMPLETIONS Hours PERFORMANCE EHS INTENSITY(1) # of plugs per run % 260 ~20% 135 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q
Slide 8: Contractual Cost Structure Declines Drive Durable FCF Growth
Contractual Cost Structure Declines Drive Durable FCF Growth Gathering rates contractually decline, driving margins and FCF higher, while MVP outcome is immaterial to outlook CORPORATE GATHERING RATES(1) 2023 – 2027E FREE CASH FLOW(2) OUTLOOK – MVP SENSITIVITY $/Mcf $B $0.75 >$12 B <1% impact to ~$0
Slide 9: Value-Focused Actions Driving Structural Improvement in Corporate Returns
Value-Focused Actions Driving Structural Improvement in Corporate Returns Cost structure reductions and accretive M&A transactions drive step-change in value creation RETURN ON CAPITAL EMPLOYED(1,2) % and $/Mcf 25% $5.00 Realized Natural Gas Price 20% $4.00 17% ($/Mcf) 15% $3.00 ROCE (%) 10% $2.00 5
Slide 10: Track Record of Asset Base Growth While Improving Balance Sheet
Track Record of Asset Base Growth While Improving Balance Sheet Well-structured, accretive M&A has increased asset base 30-40% larger with net debt down nearly 40% NET DEBT(1) FREE CASH FLOW GENERATION(1) $B $ MM $5.3 $774 MM $800 $3.3 -38% $600 YE 2019 Debt Issued Debt Paydown Q1 2023 Q1 2023 2020-
Slide 11: Accelerating Value Through Opportunistic Share Buyback Program
Accelerating Value Through Opportunistic Share Buyback Program Counter-cyclical execution has maximized returns compared to peers SHARE REPURCHASE EXECUTION(1) SUPERIOR RETURN ON OPPORTUNISTIC BUYBACKS(3) % Executed Share Repurchases EQT Share Price 10% $50 $250 OPPORTUNISTIC BUYBACK ALLOWS FOR COUN
Slide 12: Investment Grade Ratings Reduce Cost of Capital and Maximize Flexibility
Investment Grade Ratings Reduce Cost of Capital and Maximize Flexibility Continued progress towards long-term leverage(1) target of 1.0–1.5x at $2.75 gas EQT SENIOR NOTES MATURITIES(2) › Retired $1,122 MM of senior note principal in 2022 and 2023 YTD(2), excluding $128 MM of premium paid $500 MM 5.6
Slide 13: Consistent Proved Reserves Underpinned by Combo-Development
Consistent Proved Reserves Underpinned by Combo-Development Proved reserves slightly higher year-over-year with positive performance revisions 2022 PROVED RESERVES DEMONSTRATE RESILIENCY FAVORABLE RISK/REWARD PROFILE Proved reserves (Tcfe) ATAX PV-10(1), net of debt, per share PROVED RESERVES INCLUD
Slide 14: High-Quality Inventory Underpins Sustainable Capital Returns
High-Quality Inventory Underpins Sustainable Capital Returns Transparent look at core inventory shows every core location breaks even at <$3 gas HIGH-QUALITY INVENTORY: ~1,800 CORE NET LOCATIONS INVENTORY DEPTH: PV-10(1) breakeven price by well $/MMBtu A CLOSER LOOK $3.50 DIFFERENTIATED INVENTORY BA
Slide 15: Strategic Bolt-On Acquisition Expected to Strengthen EQT's Business
Strategic Bolt-On Acquisition Expected to Strengthen EQT’s Business Adding low-risk, high-quality assets offsetting existing acreage with improved free cash flow durability SW APPALACHIA ACREAGE POSITION PENDING ACQUISITION EXPECTED TO MAKE EQT’S FREE CASH FLOW EVEN MORE RESILIENT › Acquisition of T
Slide 16: Tangible Steps Toward Net Zero GHG Emissions
Tangible Steps Toward Net Zero GHG Emissions Advancing development of low carbon intensity natural gas products and verifiable carbon offsets ANNOUNCED FIRST NATURE-BASED CARBON OFFSET INITIATIVE STRATEGIC PARTNERSHIP WITH CONTEXT LABS PARTNERING WITH WHEELING PARK COMMISSION, TERALYTIC & PARTNERSHI
Slide 17: EQT Presents a Differentiated Energy Investment Opportunity
EQT Presents a Differentiated Energy Investment Opportunity Expanding track record of performance and continuing our rate of change story DO IT RIGHT… …THEN DO IT BETTER EQT Strength Detail Stat Upside and Benefits Modern operating model, data-driven Diligent approach to allocating capital, PROVEN M
Slide 18: Creating Long-Term Value in the Sustainable Shale Era
Creating Long-Term Value in the Sustainable Shale Era Robust FCF generation, strong balance sheet, large scale, low carbon & meaningful return of capital to shareholders 1 Efficient capital program to produce ~2 Tcfe “ Our story is simple: we have evolved our business to align with the core tenants
Slide 19: Appendix
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Slide 20: EQT Sells Production to Diversified End Markets
EQT Sells Production to Diversified End Markets Access to diverse markets provides flexibility and opportunity Market Mix - Price Points(1) 2023E 2024E Provides Operational and Cash Flow Flexibility › Diversity of delivery markets provides significant commercial Local 37% 26% We hedge local › option
Slide 21: Hedging Strategy Provides Compelling Risk-Adjusted Upside
Hedging Strategy Provides Compelling Risk-Adjusted Upside Hedge position as of April 21, 2023 2023 2023 2023 2024 Q2 (1) Q3 Q4 FY EQT NATURAL GAS PRICE UPSIDE Hedged Volume (MMDth) 306 299 293 206 Hedged Volume (MMDth/d) 3.3 3.3 3.2 0.6 › Implemented hedge strategy provides the best risk-adjusted up
Slide 22: The Marcellus Is the Most Capital Efficient Gas Play
The Marcellus Is the Most Capital Efficient Gas Play EQT's capital efficiency expected to improve over time THE MARCELLUS ADVANTAGE EQT CAPEX EFFICIENCY OVER TIME Capital expenditures/total sales volumes ($/Mcfe) › Lowest capital-intensive natural gas asset in the U.S. › We expect our capital effici
Slide 23: Leveraging Large-Scale Operations on a Large-Scale Asset Base
Leveraging Large-Scale Operations on a Large-Scale Asset Base Highly predictable & repeatable operations through combo-development EQT COMBO-DEVELOPMENT EXAMPLE REQUIREMENTS • Contiguous asset base REAL RESULTS • ~8,300 acres >75% >15 ~2.0 Tcfe Combo-development Years of core net Consistent 3-4 rig
Slide 24: EQT Is Changing the World That We Touch
EQT Is Changing the World That We Touch Our operational presence within local communities makes a tremendous impact VALUES IN ACTION AMERICAN SHALE: A NEW HOPE 458,000 video views TRUST | TEAMWORK | HEART | EVOLUTION Digital Wildcatters 40,500 hours of watch time › 1% Pledge: Employees encouraged to
Slide 25: EQT Is Progressing a Low-Carbon, Reliable Energy Future
EQT Is Progressing a Low-Carbon, Reliable Energy Future Differentiated natural gas supply and new venture efforts support long-term goals and demand EQT AWARDED OGMP 2.0 GOLD STANDARD RATING, FURTHER DIFFERENTIATING SUPPLY NEW VENTURES STRATEGY › Among 14 eligible upstream companies to qualify as Go
Slide 26: The Call for Clean, Reliable Energy Is a Call on EQT
The Call for Clean, Reliable Energy Is a Call on EQT The call on reliable, low-emissions natural gas provides exciting opportunity RELIABLE SUPPLY OF SCALE IS LIMITED NET ZERO TARGETS(1) › ~2/3rds of the world’s economically-recoverable natural gas EQT vs. Peers(2) resources are concentrated in four
Slide 27: Unleashing U.S. LNG: The Largest Green Initiative on the Planet
Unleashing U.S. LNG: The Largest Green Initiative on the Planet EQT stands ready to deliver supply to growing LNG markets and play a significant role in lowering global emissions The Demand The Result › There is ~175 Bcf/d of coal-to-gas switching demand › By 2030, unleashed U.S. LNG scenario estima
Slide 28: LNG Macro: Material Global Natural Gas Demand Growth
LNG Macro: Material Global Natural Gas Demand Growth Non-North American demand set to increase by ~90 Bcf/d in less than 30 years NON-NORTH AMERICAN NATURAL GAS DEMAND FORECAST Bcf/d 400 STRENGTHENING 350 INTERNATIONAL MARKET OUTLOOK 300 250 ~4 - 5 Bcf/d › 1.5 - 2.5% average annual growth of gas 200
Slide 29: Inadequate Natural Gas Storage Is Amplifying Price Volatility
Inadequate Natural Gas Storage Is Amplifying Price Volatility Lack of storage capacity relative to demand and linkage to international markets should result in persistent volatility U.S. GAS STORAGE: DAYS OF LTM DEMAND COVER(1) STORAGE EXPRESSED IN DAYS’ DEMAND COVER(1) Storage / Daily Demand Storag
Slide 30: Global LNG Supply and Demand Forecast
Global LNG Supply and Demand Forecast The LNG market is expected to double by the late 2030s; U.S. expected to be one of the largest suppliers LNG SUPPLY U.S. LNG CAPACITY BUILDOUT Bcf/d Bcf/d North America Middle East Australia Africa 30 Sabine Pass Cove Point Corpus Christi Cameron 100 Asia Russia
Slide 31: 2023 Operational Guidance
2023 Operational Guidance Consistent spending, operational outlook Production(1) 2Q23E 2023E Total sales volumes (Bcfe) 450 - 500 1,900 - 2,000 Liquids sales volume, excluding ethane (MBbls) 2,200 - 2,400 8,900 - 9,300 Ethane sales volume (MBbls) 1,500 - 1,600 6,800 - 7,000 Total liquids sales volum
Slide 32: 2023 Financial Guidance
2023 Financial Guidance NYMEX natural gas price sensitivities ADJUSTED EBITDA(1) ADJUSTED OPERATING FREE CASH FLOW(1) $B CASH FLOW(1) $B $B $3.3 - $3.6 $3.2 - $3.5 $2.9 - $3.2 $2.8 - $3.1 $2.6 - $2.9 $2.4 - $2.7 $1.4 - $1.7 $1.0 - $1.3 $0.7 - $1.0 $2.50 $3.00 $3.50 $2.50 $3.00 $3.50 $2.50 $3.00 $3.5
Slide 33: Well Activity Details
Well Activity Details 1Q23 actuals, 2Q23 and 2023 estimates Wells Drilled (Spud) SWPA NEPA WV OH 1Q23A 2Q23E 2023E 1Q23A 2Q23E 2023E 1Q23A 2Q23E 2023E 1Q23A 2Q23E 2023E Net wells 4 - 14 - 20 5 3-4 14 - 18 11 1-3 18 - 26 1 0-1 0-2 Net avg. lateral (1k ft.) 11 - 12 - 13 11 10 - 11 10 - 11 14 13 - 14 1
Slide 34: Non-GAAP Financial Measure: Reconciliation of Adjusted EBITDA
Non-GAAP Financial Measure Reconciliation of Adjusted EBITDA Adjusted EBITDA is defined as net income (loss), excluding interest expense, income tax expense (benefit), depreciation and depletion, loss (gain) on sale/exchange of long-lived assets, impairments, the revenue impact of changes in the fai
Slide 35: Non-GAAP Financial Measure: Reconciliation of LTM Adjusted EBITDA
Non-GAAP Financial Measure Reconciliation of Last Twelve Month (LTM) Adjusted EBITDA The table below reconciles adjusted EBITDA with net income (loss), the most comparable financial measure as calculated in accordance with GAAP, as reported in the Statements of Condensed Consolidated Operations to b
Slide 36: Non-GAAP Financial Measure: Free Cash Flow and Yield
Non-GAAP Financial Measure Adjusted Operating Cash Flow, Free Cash Flow, Free Cash Flow Yield and Free Cash Flow Per Share Adjusted operating cash flow is defined as net cash provided by operating activities less changes in other assets and liabilities. Free cash flow is defined as adjusted operatin
Slide 37: Non-GAAP Financial Measure: ROCE, Net Debt, Leverage
Non-GAAP Financial Measure Return on Capital Employed (ROCE), Net Debt, Leverage and Last Twelve Months (LTM) Leverage ROCE is defined as earnings before interest and income tax expense (benefit) (EBIT, a non-GAAP supplemental financial measure defined below), divided by average capital employed (a
Slide 38: Non-GAAP Financial Measure: Reconciliations of ROCE and Net Debt
Non-GAAP Financial Measure Reconciliations of ROCE and Net Debt The tables below reconcile the components of ROCE to their most comparable financial measure calculated in accordance with GAAP. Specifically, (i) Table I reconciles average capital employed and net debt with total debt, the most compar
Slide 39: Non-GAAP Financial Measure: PV-10
Non-GAAP Financial Measure PV-10 PV-10 is derived from the standardized measure of discounted future net cash flows (the Standardized Measure), which is the most directly comparable financial measure computed using U.S. GAAP. PV-10 differs from Standardized Measure because it does not include the ef