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Acquisitions
 12 Months Ended
Dec. 31, 2022
Business Combination and Asset Acquisition [Abstract]  
Acquisitions Acquisitions
Tug Hill and XcL Midstream Acquisition

On September 6, 2022 (the Original Execution Date), EQT Corporation entered into a purchase agreement (the Original Purchase Agreement) with its wholly-owned indirect subsidiary EQT Production Company (the Buyer, and together with EQT Corporation, the EQT Parties), THQ Appalachia I, LLC (the Upstream Seller) and THQ-XcL Holdings I, LLC (the Midstream Seller, and together with the Upstream Seller, the Sellers), pursuant to which the EQT Parties agreed to acquire the Upstream Seller’s upstream assets and the Midstream Seller’s gathering and processing assets through the acquisition of all of the issued and outstanding membership interests of each of THQ Appalachia I Midco, LLC and THQ-XcL Holdings I Midco, LLC (the Tug Hill and XcL Midstream Acquisition) for consideration of approximately $2.6 billion in cash and 55.0 million shares of EQT Corporation common stock, as adjusted pursuant to customary closing purchase price adjustments.

Following execution of the Original Purchase Agreement, the EQT Parties and the ultimate parent entities of the to-be-acquired interests and assets thereunder each received a request for additional information and documentary materials (the Second
Request) from the U.S. Federal Trade Commission (the FTC) in connection with the FTC’s review of the Tug Hill and XcL Midstream Acquisition. The Second Request extends the waiting period imposed by the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the HSR Act), until 30 days after the parties have substantially complied with the Second Request, unless that period is terminated sooner by the FTC. As a result, subject to certain exceptions provided in the Original Purchase Agreement, either the Buyer or the Sellers had the right to terminate the Original Purchase Agreement if the Tug Hill and XcL Midstream Acquisition did not close by December 30, 2022 (the Original Outside Date).

On December 23, 2022 (the A&R Execution Date), the EQT Parties and the Sellers entered into an Amended and Restated Purchase Agreement (the A&R Purchase Agreement, and the Original Purchase Agreement, as amended by the A&R Purchase Agreement, is referred to herein as the Tug Hill and Xcl Midstream Purchase Agreement), which amends and restates the Original Purchase Agreement in its entirety and, among other things, extends the Original Outside Date to December 29, 2023. The A&R Purchase Agreement also contains other amendments to the Original Purchase Agreement that are related to such extension, including modifications to certain purchase price adjustments and interim period operating covenants for the period beginning after the A&R Execution Date.

Pursuant to the Original Purchase Agreement, within two business days after the Original Execution Date, the Company deposited $150 million (together with any interest accrued thereon, the Escrowed Amount) into escrow, which was to be applied towards the cash consideration to be paid by the Buyer at the closing of the Tug Hill and XcL Midstream Acquisition (or, had the Original Purchase Agreement been terminated in accordance with its terms and conditions, the Escrowed Amount would have been disbursed to the Company or the Sellers as provided in the Original Purchase Agreement). Pursuant to the A&R Purchase Agreement, on the A&R Execution Date, the Company and the Sellers instructed the escrow agent to release the Escrowed Amount to the Sellers, to be used exclusively to pay down certain of the Upstream Seller’s existing indebtedness, and the Upstream Seller issued to the Company an unsecured promissory note in an amount equal to the Escrowed Amount (the Upstream Seller Note). The maturity date of the Upstream Seller Note is one year after the Termination Date (as defined in the A&R Purchase Agreement). Prior to the Termination Date, interest on the Upstream Seller Note will accrue on the outstanding principal amount at the rate of zero percent per annum; thereafter, interest will accrue on the outstanding principal amount at the rate of 10.0% per annum, with such rate increasing in increments of 0.50% on each quarterly interest payment date. Upon consummation of the Tug Hill and XcL Midstream Acquisition, the loans outstanding under the Upstream Seller Note will be applied towards the cash consideration to be paid by the Company at the closing of the Tug Hill and XcL Midstream Acquisition and such loans will be extinguished. If, however, the Tug Hill and XcL Midstream Purchase Agreement is terminated and the Sellers are entitled pursuant to the terms of Section 13.2(b) of the A&R Purchase Agreement to, and elect to, retain the Deposit (as defined in the A&R Purchase Agreement), then the loans outstanding under the Upstream Seller Note would be applied towards the Sellers’ receipt of the Deposit in accordance with Section 13.2(b) of the A&R Purchase Agreement and such loans would be extinguished.

The Tug Hill and XcL Midstream Purchase Agreement has an effective date of July 1, 2022. The closing of the pending Tug Hill and XcL Midstream Acquisition remains subject to regulatory approvals, including the termination or expiration of the applicable waiting periods under the HSR Act.

2022 Asset Acquisition

In the fourth quarter of 2022, the Company closed on the acquisition of approximately 4,600 net Marcellus acres in northeast Pennsylvania (the 2022 Asset Acquisition). The total purchase price for the acquisition was approximately $56 million. The 2022 Asset Acquisition was accounted for as an asset acquisition and, as such, the purchase price was allocated to property, plant and equipment.

Alta Acquisition

On July 21, 2021, the Company completed its acquisition (the Alta Acquisition) of Alta Marcellus Development, LLC and ARD Operating, LLC and subsidiaries (together, the Alta Target Entities), pursuant to that certain Membership Interest Purchase Agreement, dated May 5, 2021 (the Alta Purchase Agreement), by and among EQT Corporation, its indirect wholly-owned subsidiary EQT Acquisition HoldCo LLC, Alta Resources Development, LLC (Alta Resources) and the Alta Target Entities. The Alta Target Entities collectively held all of Alta Resources' upstream and midstream assets and liabilities. The purchase price for the Alta Acquisition consisted of approximately $1.0 billion in cash and 98,789,388 shares of EQT Corporation common stock, as adjusted pursuant to customary closing purchase price adjustments set forth in the Alta Purchase Agreement. The Alta Purchase Agreement has an effective date of January 1, 2021.
As a result of the Alta Acquisition, the Company acquired approximately 300,000 net Marcellus acres in northeast Pennsylvania, approximately 1.0 Bcfe per day of net production at the time of acquisition, approximately 300 miles of midstream gathering systems, approximately 100 miles of a freshwater system and a firm transportation portfolio to premium demand markets.

Allocation of Purchase Price. The Alta Acquisition was accounted for as a business combination using the acquisition method. The following table summarizes the purchase price and fair values of assets acquired and liabilities assumed as of July 21, 2021. The Company completed the purchase price allocation during the second quarter of 2022, at which time the value of the assets acquired and liabilities assumed were revised. The purchase accounting adjustments recorded in 2022 were not material to the Company's financial statements.
Purchase Price Allocation
(Thousands)
Consideration:
Equity$1,925,405 
Cash1,000,000 
Total consideration$2,925,405 
Fair value of assets acquired:
Cash and cash equivalents$43,199 
Accounts receivable, net159,539 
Property, plant and equipment3,145,630 
Other assets6,309 
Amount attributable to assets acquired$3,354,677 
Fair value of liabilities assumed:
Accounts payable$131,214 
Derivative instruments, at fair value169,744 
Other current liabilities10,127 
Other liabilities and credits118,187 
Amount attributable to liabilities assumed$429,272 

The fair value of the acquired natural gas and oil properties was measured using discounted cash flow valuation techniques based on inputs that are not observable in the market and, as such, are considered Level 3 fair value measurements. Significant inputs include future commodity prices, projections of estimated quantities of reserves, estimated future rates of production, projected reserve recovery factors, timing and amount of future development and operating costs and a weighted average cost of capital. The fair value of the acquired undeveloped properties was primarily measured using discounted cash flow valuation techniques based on inputs that are not observable in the market and, as such, are considered Level 3 fair value measurements. Significant inputs include timing and amount of future development from a market participant perspective.

The fair value of the acquired midstream gathering systems was measured primarily using the cost approach based on inputs that are not observable in the market and, as such, are considered Level 3 fair value measurements. Significant inputs include replacement costs for similar assets, relative age of the acquired assets and any potential economic or functional obsolescence associated with the acquired assets.

See Note 4 for a description of the fair value hierarchy.
Post-Acquisition Operating Results. The Alta Target Entities contributed the following to the Company's consolidated results.
July 21, 2021 through December 31, 2021
(Thousands)
Sales of natural gas, NGLs and oil$725,807 
Loss on derivatives(168,017)
Net marketing services and other7,284 
Total operating revenues$565,074 
Net income$233,254 

Unaudited Pro Forma Information. The table below summarizes the Company's results as though the Alta Acquisition had been completed on January 1, 2020. Certain of the Alta Target Entities' historical amounts were reclassified to conform to the Company's financial presentation of operations. The following unaudited pro forma information is provided for informational purposes only and does not represent what consolidated results of operations would have been had the Alta Acquisition occurred on January 1, 2020 nor are they necessarily indicative of future consolidated results of operations.
Years Ended December 31,
 20212020
(Thousands, except per share amounts)
Pro forma sales of natural gas, NGLs and oil$7,248,870 $3,092,762 
Pro forma (loss) gain on derivatives(3,902,076)501,910 
Pro forma net marketing services and other40,491 17,737 
Pro forma total operating revenues$3,387,285 $3,612,409 
Pro forma net loss$(1,119,168)$(931,195)
Pro forma net income (loss) attributable to noncontrolling interest1,246 (10)
Pro forma net loss attributable to EQT Corporation$(1,120,414)$(931,185)
Pro forma loss per share (basic)$(3.47)$(3.57)
Pro forma loss per share (diluted)$(3.47)$(3.57)

Reliance Asset Acquisition

On April 1, 2021, the Company closed on the acquisition of certain oil and gas assets (the Reliance Asset Acquisition) from Reliance Marcellus, LLC (Reliance), pursuant to the Company's exercise of a preferential purchase right that was triggered by Northern Oil and Gas, Inc.'s acquisition of Reliance's Marcellus assets. The total purchase price for the acquisition was approximately $69 million, and the assets acquired consisted of approximately 40 MMcfe per day of production at the time of acquisition and 4,100 net acres located in southwest Pennsylvania. The Reliance Asset Acquisition was accounted for as an asset acquisition and, as such, the purchase price was allocated to property, plant and equipment.

Chevron Acquisition

In the fourth quarter of 2020, the Company acquired upstream assets and an investment in midstream gathering assets located in the Appalachian Basin from Chevron U.S.A. Inc. (Chevron) for an aggregate purchase price of $735 million, subject to certain purchase price adjustments (the Chevron Acquisition). The transaction closed on November 30, 2020 and had an effective date of July 1, 2020.

The Chevron Acquisition included approximately 335,000 net Marcellus acres, approximately 400,000 net Utica acres, approximately 550 gross wells, which were producing approximately 450 net MMcfe per day at the time of acquisition, and approximately 100 work-in-process wells at various stages in the development cycle. The Chevron Acquisition also included a 31% investment in Laurel Mountain Midstream, LLC (LMM), which owns gathering assets that are operated by The Williams Companies, Inc., and two water systems that provide both fresh and produced water handling capabilities.
Allocation of Purchase Price. The Chevron Acquisition was accounted for as a business combination using the acquisition method. The following table summarizes the purchase price and the fair values of assets acquired and liabilities assumed in the Chevron Acquisition as of November 30, 2020. The Company completed the purchase price allocation during the fourth quarter of 2021, at which time the value of the assets acquired and liabilities assumed were revised. The purchase accounting adjustments recorded in 2021 were not material.
Purchase Price Allocation
(Thousands)
Consideration:
Cash (a)$701,985 
Settlement of pre-existing relationships6,645 
Total consideration$708,630 
Fair value of assets acquired:
Prepaid expenses and other$10,583 
Net property, plant and equipment725,319 
Other assets97,247 
Amount attributable to assets acquired$833,149 
Fair value of liabilities assumed:
Accounts payable$3,347 
Other current liabilities18,410 
Deferred income taxes951 
Other liabilities and credits (b)101,811 
Amount attributable to liabilities assumed$124,519 

(a)The difference between cash consideration and the aggregate purchase price of $735 million represents the results of operating activities between the effective date of July 1, 2020 and the closing date of November 30, 2020 as well as amounts related to customary post-closing matters.
(b)Other liabilities and credits includes liabilities due to minimum volume commitment (MVC) contracts as well as liabilities for asset retirement obligations and environmental obligations.

The fair value of the acquired natural gas and oil properties was measured using discounted cash flow valuation techniques based on inputs that are not observable in the market and, as such, are considered Level 3 fair value measurements. Significant inputs include future commodity prices, projections of estimated quantities of reserves, estimated future rates of production, projected reserve recovery factors, timing and amount of future development and operating costs and a weighted average cost of capital. The fair value of the undeveloped properties was measured using the guideline transaction method based on inputs that are not observable in the market and, as such, are considered Level 3 fair value measurements. Significant inputs include future development plans from a market participant perspective and value per undeveloped acre.

The fair value of the acquired investment in LMM, which is included in other assets in the Consolidated Balance Sheet, was primarily measured using discounted cash flow valuation techniques. A majority of the inputs are not observable in the market and, as such, are considered Level 3 fair value measurements. Significant inputs include projected revenues, expenses and capital expenditures.

The fair value of the acquired MVC liabilities was measured using expected throughput and annual MVCs per associated contract calculated on a discounted basis. A majority of the inputs are not observable in the market and, as such, are considered Level 3 fair value measurements. Significant inputs include estimated future volume and market participant cost of debt.