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EQT Midstream Partners Announces 2014 Financial and CAPEX Forecast



  EQT Midstream Partners Announces 2014 Financial and CAPEX Forecast

Business Wire

PITTSBURGH -- December 18, 2013

EQT Midstream Partners, LP (NYSE:EQM), an EQT Corporation company, today
announced its 2014 financial and capital expenditure (CAPEX) forecast.
Adjusted EBITDA is expected to be $170 - $175 million and distributable cash
flow is expected to be $148 - $153 million. The adjusted EBITDA, distributable
cash flow and CAPEX forecasts do not include financial impacts of potential
acquisitions. See the Non-GAAP Disclosures section below for important
information regarding the non-GAAP financial measures included in this news
release.

Distributions:

EQT Midstream Partners, LP (Partnership) forecasts quarterly distribution
increases of at least $0.03 per unit through the end of 2014. The distribution
forecast is based on accretion from the 2013 acquisition of the Sunrise
Pipeline and expected organic growth, which is driven by ongoing development
of the Marcellus shale. The 2014 expected per unit distribution of $2.14 is
29% higher than the 2013 expected per unit distribution of $1.66. The
Partnership forecasts a coverage ratio of 1.1x – 1.5x during this time period.

Capital Expenditures:

The Partnership forecasts total CAPEX to be approximately $80 - $85 million in
2014, and expects to increase Equitrans transmission capacity by 650 BBtu per
day in 2014, which will bring the total transmission throughput capacity to
2.9 TBtu per day.

Expansion

The Partnership expects to complete the fully subscribed Jefferson compression
expansion project in the third quarter of 2014, which will add 550 BBtu per
day of transmission capacity. The Jefferson compression expansion is a $30
million project, with $20 - $25 million investment expected in 2014.

On December 17, the Partnership entered into two separate agreements with
Antero Resources for firm transportation services on the Equitrans
transmission system. Each agreement will ultimately provide 100 BBtu per day
of firm transmission capacity on the transmission system for a combined total
of 200 BBtu per day. As part of the agreement, the Partnership expects to
spend approximately $55 million on two separate transmission expansion
projects in northern West Virginia. The Partnership will spend $26 million on
a west-side expansion that will add 100 BBtu per day of transmission capacity
and is expected to be in full service by year-end 2014. The Partnership will
spend $29 million on an east-side expansion that will add 100 BBtu per day of
transmission capacity and is expected to be in full service by mid-year 2015.
Combined, the agreements begin with 75 BBtu per day of firm transmission
capacity commencing on April 1, 2014 and increase to a total of 200 BBtu per
day by mid-year 2015. The agreements are primarily fixed-fee, demand based
with a 10-year term from each projects full 100 BBtu per day in-service dates.
The Partnership expects to spend approximately $30 million on the two projects
in 2014, with the remaining $25 million spent in 2015.

Ongoing Maintenance

The Partnership forecasts ongoing maintenance capital expenditures of
approximately $17 - 18 million for 2014. 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 include approximately $5 million of reimbursable
maintenance capital expenditures related to the bare steel replacement
program.

Funded Regulatory Compliance

The Partnership forecasts funded regulatory compliance capital expenditures of
approximately $12 million for 2014. 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 its initial public offering (IPO).
Funded regulatory compliance capital expenditures do not impact the
calculation of distributable cash flow and are expected to be substantially
complete by the end of 2014.

Liquidity:

As of November 30, 2013 the Partnership had zero debt outstanding and $18
million of cash. The Partnership also has $350 million available under its
revolving credit facility. As part of the Sunrise Pipeline acquisition in July
2013, the Partnership agreed to pay $110 million of consideration to EQT upon
a third-party transportation agreement becoming effective. The third-party
transportation agreement, which was related to EQT Corporation's sale of its
natural gas utility, became effective on December 17, 2013. The consideration
will be paid from cash-on-hand, plus borrowings from the credit facility.

Year-end Earnings Information:

The Partnership intends to release full-year 2013 earnings and host a live
webcast for security analysts on February 13, 2014. The webcast will be
available at www.eqtmidstreampartners.com and will begin at 11:30 a.m. ET.

NON-GAAP DISCLOSURES

Adjusted EBITDA and Distributable Cash Flow

As used in this news release, adjusted EBITDA means net income plus net
interest expense, depreciation and amortization expense, income tax expense
(if applicable), non-cash long-term compensation expense and other non-cash
adjustments (if applicable), less other income and lease payments (if
applicable). As used in this news release, distributable cash flow means
adjusted EBITDA less net cash interest, ongoing maintenance capital
expenditures and reimbursable maintenance capital expenditures plus
reimbursable maintenance capital expenditures expected to be reimbursed by
EQT. Distributable cash flow should not be viewed as indicative of the actual
amount of cash that the Partnership has available for distributions from
operating surplus or that the Partnership plans to distribute. Adjusted EBITDA
and distributable cash flow are non-GAAP supplemental financial measures that
management and external users of the Partnership’s consolidated 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 as alternatives to net
income, operating income, net cash provided by 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 its
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 1,700 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 projected net income
or projected 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.

The Partnership’s CAPEX forecast does not include capital expenditures for
potential midstream infrastructure projects not committed at this date.

Disclosures in this news 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 news 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; projected distributions per unit including
quarterly increases; capital expenditures, including the amount of capital
expenditures to be reimbursed by EQT; capital budget; project coverage ratio;
the timing, amount of, and funding sources for, any payments to EQT for any
third-party transportation agreements becoming effective related to the
Sunrise Pipeline acquisition; accretion from acquisitions; organic
transmission business growth; 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 September 30, 2013, 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 news 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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