EQT Midstream Partners Announces 2013 Financial and CapEx Forecast

  EQT Midstream Partners Announces 2013 Financial and CapEx Forecast

Business Wire

PITTSBURGH -- December 04, 2012

EQT Midstream Partners, LP (NYSE: EQM), an EQT Corporation company, today
announced its 2013 financial and capital expenditure forecast. Adjusted EBITDA
is expected to be $80 - $83 million and distributable cash flow is expected to
be $61 - $64 million. Operating revenues are seasonal, based on utility
customer contracts, and will be approximately $2 million per quarter higher in
the first and fourth quarters, than in the second and third quarters.

CAPITAL EXPENDITURES:

For 2013, EQT Midstream Partners, LP (the Partnership) forecasts total capital
expenditures to be approximately $73 million, and intends to increase
Equitrans transmission capacity by 450 MMcf per day. The Partnership expects
maintenance and regulatory capital expenditures to vary quarter-to-quarter,
primarily based on more activity when weather is favorable. The forecast does
not include acquisition capital or financial impacts of potential
acquisitions.

Expansion

The Partnership forecasts expansion capital expenditures of $38 million for
2013. Approximately $25 million will be for the Low Pressure East Pipeline
project, which will upgrade nearly 26 miles of existing pipeline in Greene,
Washington and Allegheny counties of Pennsylvania. The project will add 150
MMcf per day of transmission capacity. The remaining expansion capital
expenditures will fund new interconnects and dehydration upgrades, adding 300
MMcf per day of transmission capacity.

Ongoing Maintenance

The Partnership forecasts ongoing maintenance capital expenditures of $17.2
million for 2013. Ongoing maintenance capital expenditures are cash
expenditures made to maintain, over the long term, the Partnership’s operating
capacity or operating income. Ongoing maintenance capital expenditures exclude
funded regulatory compliance capital expenditures and reimbursable maintenance
capital expenditures.

Funded Regulatory Compliance

The Partnership forecasts funded regulatory compliance capital expenditures of
$12 million for 2013. Funded regulatory compliance capital expenditures relate
to discrete expenditures necessary to comply with two specific regulatory
compliance initiatives; system segmentation and isolation, and valve pit
remediation. In order to fund these two initiatives, the Partnership retained
$32 million from the initial public offering (IPO). Funded regulatory
compliance capital expenditures do not impact the calculation of distributable
cash flow.

Reimbursable Maintenance

The Partnership forecasts reimbursable maintenance capital expenditures of $6
million in 2013 for the bare steel replacement program. EQT Corporation has
agreed to reimburse the Partnership for bare steel replacement capital
expenditures in the event that ongoing maintenance capital expenditures exceed
$17.2 million in any year. EQT Corporation will reimburse the Partnership for
the lesser of (i) the amount of bare steel replacement capital expenditures
during such year; and (ii) the amount by which ongoing maintenance capital
expenditures exceed $17.2 million. EQT Corporation will also reimburse the
Partnership for plugging and abandonment expenditures, if any.

NON-GAAP DISCLOSURES:

Adjusted EBITDA and Distributable Cash Flow

As used in this press release, adjusted EBITDA means net income (loss) plus
net interest expense, income tax expense, depreciation and amortization
expense, and non-cash, long-term compensation expense less other income and
the Sunrise lease payment. As used in this press release, distributable cash
flow means adjusted EBITDA less net cash paid for interest expense,
maintenance capital expenditures, and income taxes. Adjusted EBITDA and
distributable cash flow are non-GAAP supplemental financial measures that
management and external users of the Partnership’s financial statements, such
as industry analysts, investors, lenders, and rating agencies, use to assess:

  *the Partnership’s operating performance as compared to other publicly
    traded partnerships in the midstream energy industry, without regard to
    historical cost basis or, in the case of adjusted EBITDA, financing
    methods;
  *the ability of the Partnership’s assets to generate sufficient cash flow
    to make distributions to the Partnership’s unitholders;
  *the Partnership’s ability to incur and service debt and fund capital
    expenditures; and
  *the viability of acquisitions and other capital expenditure projects and
    the returns on investment of various investment opportunities.

The Partnership believes that adjusted EBITDA and distributable cash flow
provide useful information to investors in assessing the Partnership’s
financial condition and results of operations. Adjusted EBITDA and
distributable cash flow should not be considered alternatives to net income,
operating income, cash flows from operating activities, or any other measure
of financial performance or liquidity presented in accordance with generally
accepted accounting principles (GAAP). Adjusted EBITDA and distributable cash
flow have important limitations as analytical tools because they exclude some,
but not all, items that affect net income and net cash provided by operating
activities. Additionally, because adjusted EBITDA and distributable cash flow
may be defined differently by other companies in the industry, the
Partnership’s definition of adjusted EBITDA and distributable cash flow may
not be comparable to similarly titled measures of other companies, thereby
diminishing their utility.

About EQT Midstream Partners:

EQT Midstream Partners, LP is a growth-oriented limited partnership formed by
EQT Corporation to own, operate, acquire and develop midstream assets in the
Appalachian basin. The Partnership provides midstream services to EQT
Corporation and third-party companies through two primary assets: the
Equitrans Transmission and Storage System and the Equitrans Gathering System.
The Partnership has a 700 mile FERC-regulated, interstate pipeline system and
more than 2,100 miles of FERC-regulated, low-pressure gathering lines.

Visit EQT Midstream Partners, LP at www.eqtmidstreampartners.com

Cautionary Statements

The Partnership is unable to provide a reconciliation of its projected
adjusted EBITDA and projected distributable cash flow to net income or net
cash provided by operating activities, the most comparable financial measures
calculated in accordance with GAAP, because of uncertainties associated with
projecting future net income and changes in assets and liabilities.

Disclosures in this press release contain certain forward-looking statements.
Statements that do not relate strictly to historical or current facts are
forward-looking. Without limiting the generality of the foregoing,
forward-looking statements contained in this press release specifically
include the expectations of plans, strategies, objectives and growth and
anticipated financial and operational performance of the Partnership and its
subsidiaries, including guidance regarding the Partnership’s projected
adjusted EBITDA and projected distributable cash flow; the effect of the
Sunrise lease on adjusted EBITDA and distributable cash flow; projected
operating revenues; capital expenditures, including the amount of capital
expenditures to be reimbursed by EQT Corporation, capital budget; and
infrastructure programs (including the timing, cost, and transmission capacity
resulting from such projects). These statements involve risks and
uncertainties that could cause actual results to differ materially from
projected results. Accordingly, investors should not place undue reliance on
forward-looking statements as a prediction of actual results. The Partnership
has based these forward-looking statements on current expectations and
assumptions about future events. While the Partnership considers these
expectations and assumptions to be reasonable, they are inherently subject to
significant business, economic, competitive, regulatory and other risks and
uncertainties, most of which are difficult to predict and many of which are
beyond the Partnership’s control. The risks and uncertainties that may affect
the operations, performance and results of the Partnership’s business and
forward-looking statements include, but are not limited to, those set forth
under Item 1A, “Risk Factors” of the Partnership’s Form 10-Q for the quarter
ended June 30, 2012, as updated by any subsequent filed 10-Qs. Any
forward-looking statement speaks only as of the date on which such statement
is made and the Partnership does not intend to correct or update any
forward-looking statement, whether as a result of new information, future
events or otherwise.

Information in this press release regarding EQT Corporation and its
subsidiaries, other than the Partnership, is derived from publicly available
information published by EQT.

Contact:

EQT Midstream Partners, LP
Analyst inquiries:
Nate Tetlow, 412-553-5834
Investor Relations Manager
ntetlow@eqtmidstreampartners.com
or
Patrick Kane, 412-553-7833
Chief Investor Relations Officer
pkane@eqtmidstreampartners.com
or
Media inquiries:
Natalie Cox, 412-395-3941
Corporate Director, Communications
ncox@eqtmidstreampartners.com
 
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