EQT Corp. (NYSE:EQT) will buy Range Resources (NYSE:RRC) in an all-stock deal valued at more than $50 billion, including debt. The combined company will produce more than 9 billion cubic feet equivalent a day of Appalachian gas, and the two companies call it the largest vertically integrated natural gas producer in the United States.
Range shareholders will receive 0.987 EQT shares for each share they hold, an implied $54.91 a share and a 20.6% premium to Friday’s close. That values Range’s equity at about $12.8 billion, according to Reuters calculations. EQT shareholders will own about 73% of the combined company and Range investors the remaining 27%.
The merged producer will end up with nearly 3 million net acres in the Appalachian Basin, more than 30 years of drilling inventory and more than 3,700 miles of midstream pipeline. EQT says the deal will cut its unlevered free cash flow breakeven to below $2 per million British thermal units and deliver $325 million in annual savings within two years, with a path to more than $600 million over the longer term.
The companies project about $20 billion in cumulative free cash flow over the next five years at recent strip prices.
EQT is adding Range as the EIA forecasts record U.S. gas output and LNG exports.
The EIA expects U.S. gas production to climb from 107.6 billion cubic feet a day in 2025 to 111.7 Bcf/d this year and 115.9 Bcf/d in 2027, with LNG exports rising to a record 17.4 Bcf/d in 2026. Half of the 378 gigawatts of U.S. gas-fired power capacity in development is tied directly to data centers, according to Global Energy Monitor. Gas reserves at 30 of the largest U.S. producers rose 14% even as their spending on mergers and acquisitions fell 70%, an EY study found.
EQT shares were down 4.2% at $53.27 in premarket trading, while Range shares jumped 14.2% to $52.00. The transaction is expected to close in the first quarter of 2027, subject to shareholder and regulatory approvals.
By Michael Kern for Oilprice.com
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