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EQT Reports Second Quarter 2013 Earnings

  EQT Reports Second Quarter 2013 Earnings

  Production volume averaged over 1 Bcf per day; Marcellus sales volume more
                                 than doubled

Business Wire

PITTSBURGH -- July 25, 2013

EQT Corporation (NYSE:EQT) today announced second quarter 2013 earnings of
$86.9 million, or $0.57 per diluted share; compared to second quarter 2012
earnings of $31.4 million, or $0.21 per diluted share. Operating cash flow was
$316.7 million, compared to second quarter 2012 operating cash flow of $166.0
million; and adjusted cash flow per share was $2.10 in the second quarter
2013, compared to $1.12 in the second quarter 2012. EQT’s second quarter 2013
operating income was $171.3 million, a 110% increase from the same quarter in
2012. The non-GAAP financial measures are detailed and reconciled in the
Non-GAAP Disclosures section below.

Second Quarter Highlights 2013 vs. 2012:

  *Production sales volume was 54% higher
  *Marcellus production sales volume was 111% higher
  *Production LOE per Mcfe was 20% lower
  *Production SG&A per Mcfe was 32% lower
  *Midstream gathered volume was 50% higher
  *Midstream gathering and compression expense per unit was 37% lower

Additional Highlights:

  *EQT sold its Sunrise Pipeline to EQT Midstream Partners, LP (NYSE: EQM)
  *Increased 2013 Production sales guidance to 360-365 Bcfe
  *Increased Marcellus EUR’s and drilling locations in its core development
    areas

Earnings per share, adjusted cash flow per share, and operating income were
higher due to increased production sales, higher prices, increased gathered
volumes, and increased transmission capacity sales and throughput. The higher
revenues were partially offset by higher non-cash compensation expenses, which
were $6.7million higher than last year. Net operating revenues increased 58%
to $469.7 million; while net operating expenses rose by $81.7 million, to
$298.4 million.

RESULTS BY BUSINESS

EQT Production

For the second quarter 2013, EQT Production had sales volume of 92.4 Bcfe, an
average of 1.0 Bcfe per day, which was a 54% increase over the second quarter
2012.This increase was driven by the Marcellus, which averaged 748 MMcfe per
day, 111% over last year. Natural gas liquids (NGL) volume totaled 1,234
Mbbls, a 45% increase over the same period last year. The Company is
increasing its full-year 2013 sales volume guidance to 360 – 365 Bcfe, which
is approximately 40% higher than 2012; and its NGL volume guidance to 4,800 –
5,000 Mbbls.

Operating income for the Production business in the second quarter 2013 was
$105.1 million, compared to $17.7 million in the same period last year – while
total operating revenues were $306.1million, 93% higher than the second
quarter 2012. The revenue growth was due to a 54% increase in sales volume and
a higher average effective price, partially offset by an increase in operating
expenses. The average effective sales price to EQT was 14% higher than last
year at $4.37 per Mcfe, with $3.30 per Mcfe allocated to EQT Production; and
$1.07 per Mcfe allocated to EQT Midstream.

Operating expenses for EQT Production for the second quarter 2013 were $201.1
million, $60.1 million higher than the same quarter last year. Depreciation,
depletion and amortization expenses (DD&A) were $49.7 million higher, due to
an increase in produced volume. Exploration expense was $4.3 million higher.
Lease operating expenses (LOE), excluding production taxes, were $2.8 million
higher; production taxes were $2.4 million higher; and selling, general and
administrative expenses (SG&A) were $1.0 million higher. Per unit SG&A
decreased 32% to $0.25 per Mcfe, and per unit LOE decreased 20% to $0.16 per
Mcfe, as volume growth dramatically outpaced higher costs.

EQT spud 41 gross wells in the Marcellus during the quarter, with an average
length-of-pay of 4,295feet; and also spud eight Upper Devonian wells. Three
Utica wells have been completed – with the first well turned-in-line on July
22, 2013; and the second and third wells expected to be turned-in-line in
early August 2013.

On May 31, the Company increased estimated ultimate recovery (EUR), and
updated its estimated drilling locations and projected type curves, for its
core Marcellus acreage in southwestern and central Pennsylvania, and northern
West Virginia. Details for each of the three core geographic areas can be
found in its investor presentation, available electronically via www.eqt.com.

EQT Midstream

EQT Midstream’s second quarter 2013 operating income was $72.2 million; $12.5
million higher than the second quarter of 2012. Net gathering revenues
increased 21% to $87.0 million, primarily due to a 50% increase in gathered
volume, partly offset by lower average gathering rates. Net transmission
revenues totaled $38.8million, an 81% increase over this quarter last year,
primarily due to sales of new capacity, as well as higher throughput. Net
storage, marketing and other revenues were $9.2million lower than last year
due to lower margins and reduced activity. Operating expenses for the quarter
were $59.1 million, $10.5 million higher than last year, which is consistent
with the growth of the business. Per unit gathering and compression expense
decreased by 37%.

The Company is increasing its projected 2013 Midstream earnings before
interest, taxes, depreciation, and amortization (EBITDA) guidance to $365 –
$370 million.

Distribution

Distribution’s second quarter 2013 operating income totaled $6.2 million,
compared to $6.4 million for the same period in 2012. Total net operating
revenues were $32.3 million, $1.1 million higher than last year; while
operating expenses were $26.1million, up $1.3 million from 2012.

OTHER BUSINESS

EQT Midstream Partners, LP

In the second quarter, EQT had a 57.4% limited partner interest and a 2%
general partner interest in EQT Midstream Partners, whose results are
consolidated in EQT’s results. EQT Midstream Partners’ second quarter 2013 net
cash provided by operating activities was $26.1 million. For the second
quarter 2013, EQT Corporation recorded $7.3 million, or $0.05 of earnings per
diluted share, attributable to non-controlling interests. EQT Midstream
Partners’ results were released today and are available at
www.eqtmidstreampartners.com.

Marcellus Processing Capacity

On July 23, EQT contracted with MarkWest for an additional 145 MMcf per day of
processing capacity, which will bring total capacity to 365 MMcf per day by
the end of 2014. EQT currently has capacity of 120 MMcf per day and as
previously announced will add 100 MMcf per day in 2013. The most recent
contracted capacity will provide an incremental 95 MMcf per day by year-end
2013; and 50 MMcf per day is expected by year-end 2014.

Sunrise Pipeline Sale

On July 22, EQT sold its Sunrise Pipeline to EQT Midstream Partners, LP for
$507.5 million cash and $32.5 million of common and general partners units.
EQT Midstream Partners also agreed to pay additional consideration of $110
million to EQT upon the execution of a third-party transportation agreement
contingent upon completion of the Utility sale. EQT Midstream Partners also
completed an offering of 12,650,000 common units representing limited partner
interests. Proceeds were used to fund the purchase of the Sunrise Pipeline.
With the transaction closing, EQT has a 42.6% limited partner interest and a
2% general partner interest in EQT Midstream Partners. As EQT controls EQT
Midstream Partners through its general partner interest, EQT Midstream
Partners continues to be consolidated in EQT’s consolidated financial
statements.

Acreage Acquisition

On June 3, EQT purchased approximately 99,000 net acres in southwestern
Pennsylvania and ten horizontal Marcellus wells, located in Washington County,
from Chesapeake Energy Corporation for approximately $112.5 million. The
acreage includes 67,000 Marcellus acres, 25,000 of which are within EQT's core
Marcellus development areas of Washington, Greene, and Allegheny counties; and
32,000 Utica acres.

Utility Sale

On December 20, 2012, the Company announced that it entered into a definitive
agreement for the transfer of its natural gas distribution business, Equitable
Gas Company, to Peoples Natural Gas, subject to receipt of regulatory
approvals. The Company recorded a $0.8 million unallocated SG&A expense in the
second quarter of 2013 related to the transaction.

The waiting period under the Hart-Scott-Rodino Antitrust Improvements Act for
the pending transaction expired on April 22, 2013, without a request for
additional information. This expiration indicates that the Federal Trade
Commission has not objected to the transaction and that the parties may
proceed. EQT has also submitted filings with the Pennsylvania Public Utility
Commission, West Virginia Public Service Commission, Kentucky Public Service
Commission, and the Federal Energy Regulatory Commission – each must approve
the transaction as part of the regulatory process. The Company expects to
receive all necessary approvals by year-end.

Hedging

As of July24, 2013, the Company has hedged approximately 60% of its expected
production sales volume for the remainder of 2013. The Company’s total natural
gas hedge positions for July 2013 through December 2015 production are:

                                      2013**  2014    2015
Fixed Price
Total Volume (Bcf)                       102      138      69
Average Price per Mcf (NYMEX)*         $ 4.55   $ 4.47   $ 4.59
                                                         
Collars
Total Volume (Bcf)                       13       24       23
Average Floor Price per Mcf (NYMEX)*   $ 4.95   $ 5.05   $ 5.03
Average Cap Price per Mcf (NYMEX)*     $ 9.09   $ 8.85   $ 8.97
                                                           

* The average price is based on a conversion rate of 1.05 MMBtu/Mcf
** July through December

Operating Income

The Company reports operating income by segment in this news release.
Interest, income taxes and unallocated income/(expense) are controlled on a
consolidated, corporate-wide basis and are not allocated to the segments. The
Company’s management reviews and reports segment results for operating
revenues and purchased gas costs, net of third-party transportation costs.

The following table reconciles operating income by segment to the consolidated
operating income reported in the Company’s financial statements:

                          Three Months Ended         Six Months Ended
                                                  
                          June 30,                   June 30,
                          2013         2012         2013         2012
Operating income
(thousands):
EQT Production            $ 105,056     $ 17,704     $ 179,153     $ 76,742
EQT Midstream               72,246        59,750       146,460       115,886
Distribution                6,170         6,376        58,446        43,146
Unallocated expenses       (12,177 )    (2,426 )    (14,129 )    (2,184  )
Operating income          $ 171,295    $ 81,404    $ 369,930    $ 233,590 
                                                                             

For the second quarter 2013, unallocated expense is primarily due to higher
non-cash incentive compensation expense.

Marcellus Horizontal Well Status (cumulative since inception)

                             As of    As of    As of     As of    As of
                              6/30/13   3/31/13   12/31/12   9/30/12   6/30/12
Wells spud                    445       404       371        344       317
Wells online                  321       276       258        229       211
Wells complete, not online    11        30        17         27        21
Frac stages (spud wells)*     9,754     8,327     7,230      6,331     5,352
Frac stages online            6,297     4,788     4,366      3,545     3,188
Frac stages complete, not     224       925       462        622       391
online

*Includes planned stages for spud wells that have not yet been hydraulically
fractured.

NON-GAAP DISCLOSURES

Adjusted Net Income and Adjusted Earnings Per Diluted Share

Adjusted net income and adjusted earnings per diluted share are non-GAAP
financial measures that are presented because they are important measures used
by management to evaluate period-to-period comparisons of earnings trends.
Adjusted net income and adjusted earnings per diluted share should not be
considered in isolation or as a substitute for the most comparable GAAP
financial measures of net income or earnings per diluted share.

The table below reconciles adjusted net income and adjusted earnings per
diluted share with net income and earnings per diluted share, as derived from
the statement of consolidated income to be included in the Company’s Form 10-Q
for the three months ended June 30, 2013 and 2012.

Reconciliation of Adjusted Net Income and Adjusted Earnings Per Diluted Share:

                                                     Three Months Ended
                                                   
                                                     June 30,
                                                     2013       2012
Net income attributable to EQT, as reported          $ 86,856    $ 31,446
(Deduct) / add back:
Non-cash financial instrument put premium              −           8,227
Tax impact                                            −          (2,608  )
Adjusted Net Income                                  $ 86,856    $ 37,065  
Diluted weighted average common shares outstanding    151,393    150,149 
Diluted EPS, as adjusted                             $ 0.57      $ 0.25
                                                                           

Operating Cash Flow:

Operating cash flow is a non-GAAP financial measure that is presented as an
accepted indicator of an oil and gas exploration and production company's
ability to internally fund exploration and development activities and to
service or incur additional debt. EQT has also included this information
because management believes that changes in operating assets and liabilities
relate to the timing of cash receipts and disbursements, which the Company may
not control; and therefore, may not relate to the period in which the
operating activities occurred. Operating cash flow should not be considered in
isolation or as a substitute for the most comparable GAAP financial measure of
net cash provided by operating activities. The table below reconciles
operating cash flow with net cash provided by operating activities, as derived
from the statement of cash flows to be included in EQT’s quarterly report on
Form 10-Q for the three and six months ended June 30, 2013 and 2012.

                         Three Months Ended          Six Months Ended
                                                  
                         June 30,                    June 30,
(thousands)              2013         2012          2013         2012
Net Income               $ 94,118      $ 31,446      $ 203,399     $ 103,481
(Deduct) / add back:
Deferred income taxes      28,905        13,694        63,252        53,057
Depreciation,
depletion, and             168,577       115,681       317,693       223,206
amortization
Non-cash incentive         15,642        8,979         27,480        17,235
compensation
Non-cash financial         –             8,227         –             8,227
instrument put premium
Other items               9,408       (12,046 )    10,694      (11,465 )
Operating cash flow:     $ 316,650    $ 165,981    $ 622,518    $ 393,741 
                                                                   
(Deduct) / add back:
Changes in other          (13,064 )    30,334      (13,692 )    24,698  
assets and liabilities
Net cash provided by     $ 303,586    $ 196,315    $ 608,826    $ 418,439 
operating activities
                                                                             

Adjusted Cash Flow Per Share

Adjusted cash flow per share is a non-GAAP financial measure that is presented
because it is a capital efficiency metric used by investors and analysts to
evaluate oil and gas companies. Adjusted cash flow per share should not be
considered in isolation or as a substitute for the most comparable GAAP
financial measure of net cash provided by operating activities or net income
per share or as a measure of liquidity.

The table below provides the calculation for adjusted cash flow per share, as
derived from the financial statements to be included in EQT’s Form 10-Q for
the three and six months ended June 30, 2013 and 2012.

                               Three Months Ended      Six Months Ended
                              June 30,              
                                                       June 30,
(thousands)                    2013       2012        2013         2012
Operating cash flow (a
non-GAAP measure reconciled    $ 316,650   $ 165,981   $ 622,518     $ 393,741
above)
(Deduct) / add back:
Exploration expense (cash)       985         1,484       1,735         2,620
Purchased gas cost audit        –          –          (4,992  )    –
adjustment
Adjusted operating cash flow   $ 317,635   $ 167,465   $ 619,261    $ 396,361
                                                                     
Diluted weighted average        151,393    150,149    151,191     150,200
common shares outstanding
Adjusted cash flow per share   $ 2.10      $ 1.12      $ 4.10       $ 2.64
                                                                       

Net Operating Revenues and Net Operating Expenses

Net operating revenues and net operating expenses are non-GAAP financial
measures that exclude purchased gas costs, but are presented because they are
important analytical measures used by management to evaluate period-to-period
comparisons of revenue and operating expenses. Purchased gas cost is typically
excluded by management in such analysis because, although subject to commodity
price volatility, purchased gas cost is mostly passed on to customers and does
not have a significant impact on EQT’s earnings. Net operating revenues and
net operating expenses should not be considered in isolation or as a
substitute for the most comparable GAAP financial measures of operating
revenues or total operating expenses. The table below reconciles net operating
revenues to operating revenues and net operating expenses to total operating
expenses for the three and six months ended June 30, 2013 and 2012:

                           Three Months Ended      Six Months Ended
                                                
                           June 30,                June 30,
(thousands)                2013       2012        2013         2012
Net operating revenues     $ 469,727   $ 298,137   $ 927,818     $ 664,031
Plus: purchased gas cost    50,365     39,667     150,934      123,733
Operating revenues         $ 520,092   $ 337,804   $ 1,078,752   $ 787,764
                                                                 
Net operating expenses     $ 298,432   $ 216,733   $ 557,888     $ 430,441
Plus: purchased gas cost    50,365     39,667     150,934      123,733
Total operating expenses   $ 348,797   $ 256,400   $ 708,822     $ 554,174
                                                                   

Q2 2013 Earnings Webcast Information

The Company's conference call with securities analysts, which begins at 10:30
a.m. ET today, will be broadcast live via the Company's website at
www.eqt.com, and on the investor information page of the Company’s web site at
http://ir.eqt.com, with a replay available for seven days following the call.

EQT Midstream Partners, LP, for which EQT Corporation is the general partner
and a significant quity owner, will host a conference call with security
analysts today, beginning at 11:30 a.m. ET. The call will be broadcast live
via www.eqtmidstreampartners.com, with a replay available for seven days
following the call.

About EQT Corporation:

EQT Corporation is an integrated energy company with emphasis on Appalachian
area natural gas production, gathering, transmission, and distribution. EQT is
the general partner, and a significant equity owner, of EQT Midstream
Partners, LP. With more than 120 years of experience, EQT is a
technology-driven leader in the integration of air and horizontal drilling.
Through safe and responsible operations, the Company is committed to meeting
the country’s growing demand for clean-burning energy, while continuing to
provide a rewarding workplace and enrich the communities where its employees
live and work. Company shares are traded on the New York Stock Exchange as
EQT.

Visit EQT Corporation on the Internet at www.EQT.com.

Cautionary Statements

The United States Securities and Exchange Commission (SEC) permits oil and gas
companies, in their filings with the SEC, to disclose only proved, probable
and possible reserves that a company anticipates as of a given date to be
economically and legally producible and deliverable by application of
development projects to known accumulations. We use certain terms, such as
“EUR” (estimated ultimate recovery) and “3P” (proved, probable and possible),
that the SEC’s guidelines prohibit us from including in filings with the SEC.
These measures are by their nature more speculative than estimates of reserves
prepared in accordance with SEC definitions and guidelines and accordingly are
less certain.

Total sales volume per day (or daily production) is an operational estimate of
the daily production or sales volume on a typical day (excluding
curtailments).

EBITDA is defined as earnings before interest, taxes, depreciation, and
amortization and is not a financial measure calculated in accordance with
generally accepted accounting principles (GAAP). EBITDA is a non-GAAP
supplemental financial measure that EQT management and external users of EQT’s
financial statements, such as industry analysts, investors, lenders and rating
agencies, may use to assess: (i) EQT’s performance versus prior periods; (ii)
EQT’s operating performance as compared to other companies in its industry;
(iii) the ability of EQT’s assets to generate sufficient cash flow to make
distributions to its investors; (iv) EQT’s ability to incur and service debt
and fund capital expenditures; and (v) the viability of acquisitions and other
capital expenditure projects and the returns on investment of various
investment opportunities.

EQT is unable to provide a reconciliation of projected EBITDA to projected net
income, the most comparable financial measure calculated in accordance with
GAAP, because of uncertainties associated with projecting future net income.

Similarly, EQT is unable to provide a reconciliation of its projected
operating cash flow to projected net cash provided by operating activities,
the most comparable financial measure 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 EQT and its subsidiaries,
including guidance regarding EQT’s strategy to develop its Marcellus and other
reserves; drilling plans and programs (including the number, type, feet of pay
and location of wells to be drilled, the conversion of drilling rigs to
utilize natural gas and the availability of capital to complete these plans
and programs); natural gas prices; total resource potential, reserves, EUR,
expected decline curve, reserve replacement ratio and production sales volume
and growth rates (including liquids sales volume and growth rates and the
projected additional production sales volume attributable to the Marcellus
wells acquired in the second quarter 2013); F&D costs, operating costs, unit
costs, well costs and gathering and transmission revenue deductions to EQT
Midstream; gathering and transmission volume and growth rates; processing
capacity; infrastructure programs (including the timing, cost and capacity of
the transmission and gathering expansion projects); technology (including
drilling techniques); projected midstream EBITDA; monetization transactions,
including midstream asset sales (dropdowns) to EQT Midstream Partners, LP (the
Partnership) and other asset sales and joint ventures or other transactions
involving EQT’s assets (including the timing of receipt, if at all, of any
additional consideration from the Partnership for new transportation
agreements entered into by the Partnership on the Sunrise Pipeline); the cash
flows resulting from, and the value of, EQT’s general partner and limited
partner interests in the Partnership; the proposed transfer of Equitable Gas
Company to Peoples Natural Gas; the timing of receipt of required approvals
for the proposed Equitable Gas Company transaction; guidance regarding the
expected form and amount of midstream assets to be exchanged in the Equitable
Gas Company transaction; the expected EBITDA to be generated from the
midstream assets and commercial arrangements transferred by or entered into
with Peoples Natural Gas or its affiliates; uses of capital provided by the
Sunrise Pipeline and Equitable Gas Company transactions; internal rate of
return (IRR); projected capital expenditures; liquidity and financing
requirements, including funding sources and availability; projected operating
revenues and cash flows; hedging strategy; the effects of government
regulation and litigation; the annual dividend rate; and tax position
(including EQT’s ability to complete like-kind exchanges). These
forward-looking 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. EQT has based these forward-looking statements
on current expectations and assumptions about future events. While EQT
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 EQT’s control. With respect to the proposed Equitable
Gas Company transaction, these risks and uncertainties include, among others,
the ability to obtain regulatory approvals for the transaction on the proposed
terms and schedule; disruption to EQT’s business, including customer, employee
and supplier relationships resulting from the transaction; and risks that the
conditions to closing may not be satisfied. The risks and uncertainties that
may affect the operations, performance and results of EQT’s business and
forward-looking statements include, but are not limited to, those set forth
under Item 1A, “Risk Factors” of EQT’s Form 10-K for the year ended December
31, 2012, as updated by any subsequent Form 10-Qs.

Any forward-looking statement speaks only as of the date on which such
statement is made and EQT does not intend to correct or update any
forward-looking statement, whether as a result of new information, future
events or otherwise.

EQT’s management speaks to investors from time to time. Slides for these
discussions will be available online via the EQT’s investor relations website
at http://ir.eqt.com. The slides may be updated periodically.

EQT CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED INCOME (UNAUDITED)
(Thousands, except per share amounts)
                                                    
                               Three Months Ended      Six Months Ended
                               June 30,                June 30,
                               2013       2012        2013         2012
Operating revenues             $ 520,092   $ 337,804   $ 1,078,752   $ 787,764
Operating expenses:
Purchased gas costs              50,365      39,667      150,934       123,733
Operation and maintenance        35,040      34,815      68,263        69,205
Production                       27,747      22,572      52,636        49,595
Exploration                      6,138       1,887       9,868         3,715
Selling, general and             60,930      41,778      109,428       84,720
administrative
Depreciation, depletion and     168,577    115,681    317,693      223,206
amortization
Total operating expenses       $ 348,797   $ 256,400   $ 708,822     $ 554,174
Operating income                 171,295     81,404      369,930       233,590
Other income                     2,111       5,249       4,441         11,040
Interest expense                37,384     40,629     75,136       81,881
Income before income taxes       136,022     46,024      299,235       162,749
Income taxes                    41,904     14,578     95,836       59,268
Net income                     $ 94,118    $ 31,446    $ 203,399     $ 103,481
Less: Net income
attributable to                $ 7,262     $ -         $ 16,288      $ -
noncontrolling interests
Net income attributable to     $ 86,856    $ 31,446    $ 187,111     $ 103,481
EQT Corporation
Earnings per share of common
stock attributable to EQT
Corporation
Basic:
Weighted average common          150,525     149,582     150,425       149,532
shares outstanding
Net income                     $ 0.58      $ 0.21      $ 1.24        $ 0.69
Diluted:
Weighted average common          151,393     150,149     151,191       150,200
shares outstanding
Net income                     $ 0.57      $ 0.21      $ 1.24        $ 0.69
                                                                       

EQT Corporation
Price Reconciliation
                                                  
                         Three Months Ended          Six Months Ended
                         June 30,                    June 30,
in thousands (unless     2013         2012          2013         2012
noted)
LIQUIDS
Natural Gas Liquids
(NGLs):
Sales Volume (MMcfe)       4,863         3,206         9,233         6,176
(a)
Sales Volume (Mbbls)       1,234         850           2,428         1,637
Gross Price ($/Mbbls)    $ 39.93      $ 41.56      $ 41.47      $ 48.42   
Gross NGL Revenue        $ 49,260      $ 35,323      $ 100,683     $ 79,263
BTU Premium (Ethane
sold as natural gas):
Sales Volume (MMbtu)       6,962         5,068         13,329        9,717
Price ($/MMbtu)           4.09        2.22        3.74        2.46    
BTU Premium Revenue      $ 28,488      $ 11,245      $ 49,894      $ 23,952
Oil:
Sales Volume (MMcfe)       327           437           695           764
(a)
Sales Volume (Mbbls)       54            73            116           127
Net Price ($/Mbbls)       83.95      85.99       82.55       85.49   
Net Oil Revenue            4,575         6,277         9,561         10,844
                                                                   
Total Liquids Revenue      82,323        52,845        160,138       114,099
GAS
Sales Volume (MMcf)        87,226        56,353        161,880       107,127
NYMEX Price ($/Mcf)      $ 4.09       $ 2.22       $ 3.74       $ 2.46    
(b)
Gas Revenues             $ 356,929     $ 125,029     $ 605,949     $ 263,945
Basis                     (939    )    366         (1,132  )    248     
Gross Gas Revenue        $ 355,990     $ 125,395     $ 604,817     $ 264,193
(unhedged)
                                                                   
Total Gross Gas &
Liquids Revenue          $ 438,313     $ 178,240     $ 764,955     $ 378,292
(unhedged)
Hedge impact              9,728       85,397      53,226      162,144 
Total Gross Gas &        $ 448,041     $ 263,637     $ 818,181     $ 540,436
Liquid Revenue
Total Sales Volume        92,416      59,997      171,808     114,067 
(MMcfe)
Average hedge adjusted   $ 4.85        $ 4.39        $ 4.76        $ 4.74
price ($/Mcfe)
                                                                   
Midstream Revenue
Deductions ($ / Mcfe)
Gathering to EQT           (0.83   )     (1.05   )     (0.86   )     (1.06   )
Midstream
Transmission to EQT        (0.24   )     (0.16   )     (0.24   )     (0.17   )
Midstream
Third-party gathering      (0.37   )     (0.46   )     (0.33   )     (0.33   )
and transmission (c)
Third-party processing    (0.11   )    (0.10   )    (0.11   )    (0.10   )
Total midstream           (1.55   )    (1.77   )    (1.54   )    (1.66   )
revenue deductions
Average effective
sales price to EQT       $ 3.30       $ 2.62       $ 3.22       $ 3.08    
Production
                                                                   
EQT Revenue ($ / Mcfe)
Revenues to EQT          $ 1.07        $ 1.21        $ 1.10        $ 1.23
Midstream
Revenues to EQT           3.30        2.62        3.22        3.08    
Production
Average effective
sales price to EQT       $ 4.37       $ 3.83       $ 4.32       $ 4.31    
Corporation
                                                                             

      NGLs were converted to Mcfe at the rates of 3.94 Mcfe per barrel and
      3.77 Mcfe per barrel based on the liquids content for the three months
(a)  ended June 30, 2013 and 2012, respectively, and 3.80 Mcfe per barrel and
      3.77 Mcfe per barrel based on the liquids content for the six months
      ended June 30, 2013 and 2012, respectively. Crude oil was converted to
      Mcfe at the rate of six Mcfe per barrel for all periods.
      The Company’s volume weighted NYMEX natural gas price (actual average
(b)   NYMEX natural gas price ($/Mcf) was $4.09 and $2.22 for the three months
      ended June 30, 2013 and 2012, respectively; and $3.71 and $2.48 for the
      six months ended June 30, 2013 and 2012, respectively.)
      Due to the sale of unused capacity on the El Paso 300 line that was not
      under long-term resale agreements at prices below the capacity charge,
      third-party gathering and transmission rates increased by $0.09 per Mcfe
      and $0.07 per Mcfe for the three and six months ended June 30, 2013,
      respectively. The unused capacity on the El Paso 300 line not under
(c)   long-term resale agreements was sold at prices below the capacity
      charge, increasing third-party gathering and transmission rates by $0.12
      per Mcfe for the three months ended June 30, 2012. The sale of unused
      capacity on the El Paso 300 line that was not under long-term resale
      agreements had no impact on third-party gathering and transmission rates
      for the six months ended June 30, 2012.
      

                                       Three Months Ended   Six Months Ended
UNIT COSTS                                               
                                       June 30,             June 30,
                                       2013       2012     2013     2012
Production segment costs: ($ / Mcfe)
LOE                                    $  0.16     $ 0.20   $  0.16   $ 0.20
Production taxes*                         0.14       0.17      0.15     0.18
SG&A                                     0.25      0.37     0.27    0.38
                                       $  0.55     $ 0.74   $  0.58   $ 0.76
Midstream segment costs: ($ / Mcfe)
Gathering and transmission             $  0.23     $ 0.34   $  0.24   $ 0.36
SG&A                                     0.15      0.18     0.15    0.18
                                       $  0.38     $ 0.52   $  0.39   $ 0.54
Total ($ / Mcfe)                       $  0.93     $ 1.26   $  0.97   $ 1.30
                                                                        

*Excludes the retroactive Pennsylvania Impact Fee of $0.01 per Mcfe and $0.06
per Mcfe for the three and six months ended June 30, 2012, respectively, for
Marcellus wells spud prior to 2012.

EQT PRODUCTION
RESULTS OF OPERATIONS
                                                      
                                 Three Months Ended      Six Months Ended

                                 June 30,                June 30,
                                 2013       2012        2013       2012
OPERATIONAL DATA
                                                                     
Sales volume detail (MMcfe):
Horizontal Marcellus Play (a)      68,057      32,223      122,572     59,065
Horizontal Huron Play              7,500       9,852       15,531      19,518
CBM Play                           3,116       3,288       6,232       6,586
Other (vertical non-CBM)          13,743     14,634     27,473     28,898
Total production sales volume      92,416      59,997      171,808     114,067
                                                                     
Average daily sales volume         1,016       659         949         627
(MMcfe/d)
                                                                     
Average effective sales price    $ 3.30      $ 2.62      $ 3.22      $ 3.08
to EQT Production ($/Mcfe)
                                                                     
Lease operating expenses
(LOE), excluding production      $ 0.16      $ 0.20      $ 0.16      $ 0.20
taxes ($/Mcfe)
Production taxes ($/Mcfe) (b)    $ 0.14      $ 0.17      $ 0.15      $ 0.18
Production depletion ($/Mcfe)    $ 1.53      $ 1.54      $ 1.54      $ 1.55
                                                                     
Depreciation, depletion and
amortization (DD&A)
(thousands):
Production depletion             $ 141,661   $ 92,430    $ 264,152   $ 176,956
Other DD&A                        2,412      1,975      4,830      4,016
Total DD&A (thousands)           $ 144,073   $ 94,405    $ 268,982   $ 180,972
                                                                     
Capital expenditures             $ 398,078   $ 264,926   $ 645,024   $ 448,611
(thousands) (c)
                                                                     
                                                                     
FINANCIAL DATA (thousands)
                                                                     
Total operating revenues         $ 306,132   $ 158,649   $ 556,643   $ 354,045
                                                                     
Operating expenses:
LOE, excluding production          14,612      11,798      27,651      22,734
taxes
Production taxes (b)               13,134      10,774      24,985      26,861
Exploration expense                6,138       1,887       9,868       3,715
Selling, general and               23,119      22,081      46,004      43,021
administrative (SG&A)
DD&A                              144,073    94,405     268,982    180,972
Total operating expenses          201,076    140,945    377,490    277,303
Operating income                 $ 105,056   $ 17,704    $ 179,153   $ 76,742
                                                                       

(a)  Includes Upper Devonian.

      Production taxes include severance and production-related ad valorem and
      other property taxes and the Pennsylvania impact fee. The Pennsylvania
      impact fee for the three and six months ended June 30, 2013 totaled $2.7
      million and $5.6 million, respectively. The Pennsylvania impact fee for
(b)   the three and six months ended June 30, 2012 totaled $3.1 million and
      $11.3 million, respectively, of which $0.5 million and $6.7 million
      represented the retroactive fee for pre-2012 Marcellus wells. The
      production taxes unit rate for the three and six months ended June 30,
      2012 excludes the impact of the accrual for pre-2012 Marcellus wells.

      Includes $112.5 million of capital expenditure for the purchase of
(c)   acreage and Marcellus wells from Chesapeake Energy Corporation and its
      partners during the three and six months ended June 30, 2013.
      

EQT MIDSTREAM
RESULTS OF OPERATIONS
                                                    
                               Three Months Ended      Six Months Ended

                               June 30,                June 30,
                               2013       2012        2013       2012
OPERATIONAL DATA
                                                                             
Gathered volume (BBtu)           116,132     77,393      217,363     148,559
Average gathering fee          $ 0.75      $ 0.93      $ 0.78      $ 0.95
($/MMBtu)
Gathering and compression      $ 0.17      $ 0.27      $ 0.18      $ 0.27
expense ($/MMBtu)
Transmission pipeline            104,846     47,049      185,817     89,124
throughput (BBtu)
                                                                             
Net operating revenues
(thousands):
Gathering                      $ 86,992    $ 72,124    $ 168,806   $ 141,377
Transmission                     38,836      21,514      76,143      44,455
Storage, marketing and other    5,502      14,671     15,261     29,594  
Total net operating revenues   $ 131,330   $ 108,309   $ 260,210   $ 215,426
                                                                             
Unrealized gains (losses) on
derivatives and inventory      $ 1,288     $ 3,519     $ 2,962     $ (1,928  )
(thousands) (a)
                                                                             
Capital expenditures             91,254      119,925     142,612     199,563
(thousands)
                                                                   
FINANCIAL DATA (thousands)
                                                                   
Total operating revenues       $ 150,366   $ 120,098   $ 297,054   $ 242,146
Purchased gas costs             19,036     11,789     36,844     26,720  
Total net operating revenues     131,330     108,309     260,210     215,426
                                                                   
Operating expenses:
Operating and maintenance        23,936      23,700      46,609      47,804
(O&M)
SG&A                             16,696      9,875       30,470      22,044
DD&A                            18,452     14,984     36,671     29,692  
Total operating expenses        59,084     48,559     113,750    99,540  
Operating income               $ 72,246    $ 59,750    $ 146,460   $ 115,886 
                                                                             

(a) Included within storage, marketing and other net operating revenues.

DISTRIBUTION
RESULTS OF OPERATIONS
                                                      
                                   Three Months Ended    Six Months Ended

                                   June 30,              June 30,
                                   2013      2012       2013       2012
                                                                     
OPERATIONAL DATA
                                                                       
Heating degree days (30 year         505        489        3,409       2,721
average: QTD – 665; YTD – 3,535)
                                                                       
Residential sales and                2,892      2,405      14,544      11,460
transportation volume (MMcf)
Commercial and industrial volume    5,190     5,753     15,231     15,112
(MMcf)
Total throughput (MMcf)              8,082      8,158      29,775      26,572
                                                                       
Net operating revenues
(thousands):
Residential                        $ 19,860   $ 17,974   $ 73,927    $ 58,634
Commercial and industrial            7,938      8,660      27,644      25,683
Off-system and energy services      4,474     4,554     9,412      10,262
Total net operating revenues       $ 32,272   $ 31,188   $ 110,983   $ 94,579
                                                                       
Capital expenditures (thousands)   $ 9,558    $ 7,439    $ 15,163    $ 12,902
                                                                     
FINANCIAL DATA (thousands)
                                                                       
Total operating revenues           $ 56,345   $ 48,273   $ 210,163   $ 183,694
Purchased gas costs                 24,073    17,085    99,180     89,115
Net operating revenues               32,272     31,188     110,983     94,579
                                                                     
Operating expenses:
O&M                                  11,018     10,248     21,053      20,461
SG&A                                 9,012      8,277      19,364      18,442
DD&A                                6,072     6,287     12,120     12,530
Total operating expenses            26,102    24,812    52,537     51,433
Operating income                   $ 6,170    $ 6,376    $ 58,446    $ 43,146
                                                                       

Contact:

EQT Corporation
Analyst inquiries please contact:
Patrick Kane – Chief Investor Relations Officer, 412-553-7833
pkane@eqt.com
or
Nate Tetlow – Manager, Investor Relations, 412-553-5834
ntetlow@eqt.com
or
Media inquiries please contact:
Natalie Cox – Corporate Director, Communications, 412-395-3941
ncox@eqt.com
 
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