Financial Information by Business Segment

12 Months Ended

Dec. 31, 2015

Segment Reporting [Abstract]

Financial Information by Business Segment

Financial Information by Business Segment

Operating segments are revenue-producing components of the enterprise for which separate financial information is produced internally and which are subject to evaluation by the Company’s chief operating decision maker in deciding how to allocate resources.

The Company reports its operations in two segments, which reflect its lines of business. The EQT Production segment includes the Company’s exploration for, and development and production of, natural gas, NGLs and a limited amount of crude oil in the Appalachian and Permian Basins. The EQT Midstream segment’s operations include the natural gas gathering, transmission, storage and marketing activities of the Company, including ownership and operation of EQGP and EQM. EQT Production segment revenues in the table below are reduced by charges from EQT Midstream for midstream services. On the Statements of Consolidated Income, the sales of natural gas, oil and NGLs are not reduced by these charges.

Operating segments are evaluated on their contribution to the Company’s consolidated results based on operating income. Other income, interest and income taxes are managed on a consolidated basis. Headquarters’ costs are billed to the operating segments based upon an allocation of the headquarters’ annual operating budget. Differences between budget and actual headquarters’ expenses are not allocated to the operating segments.

Substantially all of the Company’s operating revenues, income from operations and assets are generated or located in United States.

	Years Ended December 31,
	2015			2014			2013
				(Thousands)
Revenues from external customers, including affiliates:
EQT Production	$	1,540,889		$	1,813,292		$	1,310,938
EQT Midstream	807,904			699,083			614,042
Less intersegment revenues, net (a)	(9,031		)	(42,665		)	(62,969		)
Total	$	2,339,762		$	2,469,710		$	1,862,011
Operating income:
EQT Production (b)	$	104,865		$	505,950		$	371,245
EQT Midstream (b)	473,378			384,309			328,782
Unallocated expenses (c)	(15,104		)	(36,864		)	(45,423		)
Total operating income	$	563,139		$	853,395		$	654,604
Reconciliation of operating income to income from continuing operations:
Other income	$	9,953		$	6,853		$	9,242
Interest expense	146,531			136,537			142,688
Income tax expense	104,675			214,092			175,186
Income from continuing operations	$	321,886		$	509,619		$	345,972

	As of December 31,
	2015		2014		2013
	(Thousands)
Segment assets:
EQT Production	$	8,995,853	$	8,153,199	$	6,359,065
EQT Midstream	3,226,138		2,709,052		2,514,429
Total operating segments	12,221,991		10,862,251		8,873,494
Headquarters assets, including cash and short-term investments	1,754,181		1,173,102		892,413
Total assets	$	13,976,172	$	12,035,353	$	9,765,907

(a)  Eliminates intercompany natural gas sales from EQT Production to EQT Midstream.

(b)  Gains on sales / exchanges of assets of $27.4 million and $6.8 million are included in EQT Production and EQT Midstream operating income, respectively, for 2014. See Note 8. Impairment of long-lived assets of $118.3 million and $267.3 million are included in EQT Production operating income for 2015 and 2014, respectively. Impairment of long-lived assets of $4.2 million is included in EQT Midstream operating income for 2015. See Note 1 for a discussion of impairment of long-lived assets.

(c)  Unallocated expenses consist primarily of a $20.0 million contribution to the EQT Foundation in 2014, incentive compensation expense, and administrative costs.

	Years Ended December 31,
	2015		2014			2013
			(Thousands)
Depreciation, depletion and amortization:
EQT Production	$	723,448	$	592,855		$	578,641
EQT Midstream	95,280		87,034			75,032
Other	488		(591		)	(541		)
Total	$	819,216	$	679,298		$	653,132
Expenditures for segment assets: (d)
EQT Production (e)	$	1,852,100	$	2,441,486		$	1,423,185
EQT Midstream	486,809		455,359			369,399
Other	5,505		3,341			4,292
Total	$	2,344,414	$	2,900,186		$	1,796,876

(d) Includes a portion of non-cash stock-based compensation expense and the impact of capital accruals.

(e)   Expenditures for segment assets in the EQT Production segment included $182.3 million, $724.4 million and $186.2 million for property acquisitions in 2015, 2014 and 2013, respectively.  Included within the $724.4 million of property acquisitions for the year ended December 31, 2014 was $349.2 million of non-cash capital expenditures for the exchange of assets with Range (described in Note 8).