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Key Takeaways

• EQT shares rose after the natural gas producer said Blackstone’s credit and insurance business is buying a $3.5 billion stake in its midstream assets through a joint venture.

• EQT said the money raised will be used to buy back its debt.

• The investment values the joint venture at around $8.8 billion.

EQT (EQT) shares rose after the natural gas producer said Blackstone’s (BX) credit and insurance business is buying a $3.5 billion stake in its midstream assets through a joint venture.

Under the terms of the deal, Blackstone gets a non-controlling common equity stake in a joint venture housing three midstream infrastructure assets owned by the U.S. energy group: Mountain Valley Pipeline, LLC – Series A, Federal Energy Regulatory Commission (FERC) regulated transmission and storage assets, and the Hammerhead Pipeline.

The investment values the joint venture at around $8.8 billion.

EQT Says It Will Pay Down Debt With Proceeds

EQT said that it planned to use the money raised to “pay down its term loan and revolving credit facility and redeem and tender for senior notes.”

EQT Corp. acquired midstream infrastructure provider Equitrans Midstream Corp. (ETRN) earlier this year. EQT said it expects to end 2024 with around $9 billion of net debt.

The transaction is expected to close in the current quarter.

In a separate statement, EQT said it will offer to purchase its outstanding senior notes due in 2028, 2029, 2030, and 2048. The buyback is contingent on the Blackstone agreement being completed.

Shares of EQT rose 2% in intraday trading Monday to a two-year high. Blackstone shares fell more than 1.5% but are up almost 50% this year.