Financial Information by Business Segment (Tables)

6 Months Ended

Jun. 30, 2018

Schedule of company's operating revenues, income from operations and assets



Three Months Ended June 30, 2018	EQT Production			EQM Gathering		EQM Transmission		RMP Gathering		RMP Water		Intersegment Eliminations			EQT Corporation
Revenues:	(Thousands)
Sales of natural gas, oil and NGLs	$	991,365		$	—	$	—	$	—	$	—	$	—		$	991,365
Pipeline, water and net marketing services	13,180			180,616		89,145		62,281		42,655		(270,674		)	117,203
Loss on derivatives not designated as hedges	(53,897		)	—		—		—		—		—			(53,897		)
Total operating revenues	$	950,648		$	180,616	$	89,145	$	62,281	$	42,655	$	(270,674	)	$	1,054,671



Three Months Ended June 30, 2017	EQT Production		EQM Gathering		EQM Transmission		Intersegment Eliminations			EQT Corporation
Revenues:	(Thousands)
Sales of natural gas, oil and NGLs	$	576,714	$	—	$	—	$	—		$	576,714
Pipeline and net marketing services	8,061		112,145		84,670		(139,174		)	65,702
Gain on derivatives not designated as hedges	46,326		—		—		—			46,326
Total operating revenues	$	631,101	$	112,145	$	84,670	$	(139,174	)	$	688,742




Six Months Ended June 30, 2018	EQT Production		EQM Gathering		EQM Transmission		RMP Gathering		RMP Water		Intersegment Eliminations			EQT Corporation
Revenues:	(Thousands)
Sales of natural gas, oil and NGLs	$	2,217,739	$	—	$	—	$	—	$	—	$	—		$	2,217,739
Pipeline and net marketing services	36,250		360,244		196,079		123,782		65,618		(520,153		)	261,820
Gain on derivatives not designated as hedges	8,695		—		—		—		—		—			8,695
Total operating revenues	$	2,262,684	$	360,244	$	196,079	$	123,782	$	65,618	$	(520,153	)	$	2,488,254




Six Months Ended June 30, 2017	EQT Production		EQM Gathering		EQM Transmission		Intersegment Eliminations			EQT Corporation
Revenues:	(Thousands)
Sales of natural gas, oil and NGLs	$	1,250,179	$	—	$	—	$	—		$	1,250,179
Pipeline and net marketing services	22,516		214,474		182,413		(273,739		)	145,664
Gain on derivatives not designated as hedges	187,068		—		—		—			187,068
Total operating revenues	$	1,459,763	$	214,474	$	182,413	$	(273,739	)	$	1,582,911



	Three Months Ended June 30,						Six Months Ended June 30,
	2018			2017			2018			2017
	(Thousands)
Operating income (loss):
EQT Production (a)	$	(79,846	)	$	52,884		$	(2,005,645	)	$	310,433
EQM Gathering	121,631			83,425			252,513			157,129
EQM Transmission	60,642			57,863			140,093			129,467
RMP Gathering	39,614			—			83,709			—
RMP Water	23,981			—			35,351			—
Unallocated expenses and intersegment eliminations (b)	(66,053		)	(4,045		)	(129,568		)	(15,926		)
Total operating income (loss)	$	99,969		$	190,127		$	(1,623,547	)	$	581,103


(a)	Impairment of long-lived assets of $0.1 billion is included in EQT Production operating income for the three months ended June 30, 2018 and $2.4 billion for the six months ended June 30, 2018. See Note Q.

(b)

Unallocated expenses consist of compensation expense and administrative costs, including transaction costs of $19.7 million for the three months ended June 30, 2018 and $54.5 million for the six months ended June 30, 2018. Intersegment eliminations include the profit on water services that are provided to EQT Production and capitalized as part of development costs of $24.9 million for the three months ended June 30, 2018 and $47.5 million for the six months ended June 30, 2018.

Reconciliation of operating income to income from continuing operations

Reconciliation of operating income (loss) to net income (loss):



	Three Months Ended June 30,					Six Months Ended June 30,
	2018			2017		2018			2017
	(Thousands)
Total operating income (loss)	$	99,969		$	190,127	$	(1,623,547	)	$	581,103
Other income	11,752			6,305		21,337			9,354
Interest expense	77,004			44,078		147,017			86,733
Income tax (benefit) expense	(101,629		)	29,709		(440,594		)	130,374
Net income (loss)	$	136,346		$	122,645	$	(1,308,633	)	$	373,350

Schedule of segment assets



	June 30, 2018		December 31, 2017
	(Thousands)
Segment assets:
EQT Production	$	19,393,931	$	21,015,132
EQM Gathering	3,151,655		2,961,099
EQM Transmission	2,486,059		1,923,427
RMP Gathering	2,800,534		2,720,305
RMP Water	165,476		185,079
Total operating segments	27,997,655		28,805,042
Headquarters assets, including cash and short-term investments	965,573		717,562
Total assets	$	28,963,228	$	29,522,604

Schedule of depreciation, depletion and amortization and expenditures for segment assets



	Three Months Ended June 30,					Six Months Ended June 30,
	2018			2017		2018			2017
	(Thousands)
Depreciation and depletion: (c)
EQT Production	$	374,782		$	219,211	$	770,635		$	430,308
EQM Gathering	15,646			9,555		30,590			18,415
EQM Transmission	12,430			11,845		24,871			23,532
RMP Gathering	8,236			—		16,360			—
RMP Water	5,798			—		11,569			—
Other	780			206		1,540			480
Total	$	417,672		$	240,817	$	855,565		$	472,735

Expenditures for segment assets: (d)
EQT Production (e)	$	739,183		$	455,721	$	1,369,941		$	1,401,179
EQM Gathering	139,099			53,708		252,297			102,546
EQM Transmission	27,962			29,978		46,891			51,367
RMP Gathering	47,358			—		68,298			—
RMP Water	7,002			—		9,377			—
Other and intersegment eliminations (f)	(21,889		)	2,967		(43,112		)	4,595
Total	$	938,715		$	542,374	$	1,703,692		$	1,559,687


(c)	Excludes amortization of intangible assets.

(d)

Includes the capitalized portion of non-cash stock-based compensation costs, non-cash acquisitions and the impact of capital accruals. The impact of accrued capital expenditures includes the reversal of the prior period accrual as well as the current period estimate, both of which are non-cash items. The net impact of these non-cash items was $(34.3) million and $37.4 million for the three months ended June 30, 2018 and 2017, respectively, and $6.6 million and $58.4 million for the six months ended June 30, 2018 and 2017, respectively. These non-cash items are excluded from capital expenditures on the Statements of Condensed Consolidated Cash Flows. Expenditures for segment assets does not include consideration for the Rice Merger.

(e)

Expenditures for segment assets in the EQT Production segment included $41.3 million and $47.0 million for fill-ins and bolt-ons associated with legacy EQT acreage for the three months ended June 30, 2018 and 2017, respectively, and $78.1 million and $89.7 million for fill-ins and bolt-ons associated with legacy EQT acreage for the six months ended June 30, 2018 and 2017, respectively. The three and six months ended June 30, 2017 included $141.7 million and $811.2 million of cash capital expenditures, respectively, and $9.7 million of non-cash capital expenditures for the six months ended June 30, 2017, for the acquisitions discussed in Note P.


(f)	Intersegment eliminations include profit on water services that are provided to EQT Production and capitalized as part of development costs.