April 23, 2025 [Reuters]- EQT said on Tuesday it plans to buy the upstream and midstream assets of oil-and-gas producer Olympus Energy for $1.8 billion to expand its presence in the natural gas-rich Marcellus region in the U.S.
A wave of consolidation in the U.S. energy sector since 2023 started to show signs of fatigue towards the end of last year, but North America is expected to remain a leader in global M&A activity.
EQT’s cash-and-stock deal comes even as the natural gas producer attempts to reduce debt it had accumulated after the $14 billion purchase of pipeline operator Equitrans Midstream last year.
It had net debt of $8.1 billion as of March 31 and expects to reach about $7 billion by the year-end.
The deal with Olympus, expected to close early in the third quarter of 2025, consists of 26 million shares of EQT common stock worth $1.3 billion and $500 million in cash, which the company expects to fund with cash on hand and borrowings under its revolving credit facility.
“Olympus Energy has over 10 years of high-quality Marcellus inventory at maintenance activity levels, with an additional 7 years of upside from the Utica,” EQT said in a statement. Both Marcellus and Utica are large shale formations in the United States.
The Marcellus formation accounts for about 21% of all U.S. gross natural gas production, according to the Energy Information Administration (EIA).
FIRST-QUARTER RESULTS
EQT also beat first-quarter profit estimates, benefiting from higher natural gas prices and sales volumes.
Average natural gas prices have risen over the past few quarters, reaching a two-year high on March 10, supported by record flows to liquefied natural gas (LNG) export facilities and concerns over supply in the lead-up to the summer season.
EQT’s average realized price for natural gas during the quarter was up 17% year-over-year, at $3.77 per thousand cubic feet equivalent (Mcfe), while sales volume was up 6.9% to 570,751 million cubic feet equivalent (MMcfe).
The company also raised its full-year production forecast by 25 billion cubic feet equivalent (Bcfe) to between 2,200 and 2,300 Bcfe.
EQT reported an adjusted profit of $1.18 per share for the quarter ended March 31, above analysts’ average estimate of $1.02 per share, according to data compiled by LSEG.
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