Market Overview

Q2 2018 Results Announced for EQT Midstream Partners and EQT GP Holdings

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EQT Midstream Partners, LP (NYSE:EQM) today announced second quarter
2018 results, including net income attributable to EQM of $172.6
million, adjusted EBITDA of $209.5 million, net cash provided by
operating activities of $220.2 million, and distributable cash flow of
$174.7 million. EQM operating income was $182.3 million, which was 29%
higher than last year. The Non-GAAP Disclosures section of this news
release provides reconciliations of non-GAAP financial measures to their
most comparable GAAP financial measure as well as important disclosures
regarding projected adjusted EBITDA and projected distributable cash
flow.

EQT GP Holdings, LP (NYSE:EQGP) today announced net income attributable
to EQGP of $103.3 million for the second quarter 2018.

EQM HIGHLIGHTS:

  • Closed acquisition of Rice Midstream Partners LP on July 23rd
  • Completed acquisition of Olympus and Strike Force gathering systems
    from EQT and Gulfport
  • Issued $2.5 billion of senior notes
  • Increased EQM per unit distribution by 17% and EQGP by 46% compared to
    Q2 2017
  • Generated 72% of operating revenue from firm reservation fees

In the second quarter EQM closed the acquisition of the Olympus
gathering system and 75% interest in the Strike Force gathering system
from EQT Corporation (EQT) for $1.15 billion in cash and 5.9 million EQM
common units (May 2018 Acquisition). EQM also completed the purchase of
the remaining 25% interest in the Strike Force gathering system from
Gulfport Energy for $175 million in cash. The acquisitions were
effective May 1, 2018.

On May 22, 2018, EQGP purchased the Rice Midstream Partners LP (RMP)
Incentive Distribution Rights from EQT for 36.3 million EQGP common
units.

EQM's financial statements have been retrospectively recast to include
the pre-acquisition results of the May 2018 Acquisition from the time
common control began on November 13, 2017 as a result of EQT's
acquisition of Rice Energy. EQM's second quarter operating revenue
increased $72.9 million, a 37% increase compared to the same quarter
last year. The May 2018 Acquisition accounted for $55.3 million of the
operating revenue increase, with the remaining increase due to higher
contracted firm transmission and gathering capacity. During the quarter,
72% of operating revenue was generated by firm reservation fees.
Operating expenses increased $32.0 million versus the second quarter of
2017, with approximately $30.1 million of the increase due to the May
2018 Acquisition assets, including $3.4 million in transaction costs.
The remaining operating expense increase is consistent with higher
system throughput and additional assets placed in service, consistent
with the growth in the business.

ACQUISITION OF RICE MIDSTREAM PARTNERS LP

On July 23, 2018 EQM closed the acquisition of RMP, with each RMP
unitholder receiving 0.3319 units of EQM. The RMP debt balance of $260
million was retired using proceeds from EQM's $2.5 billion senior note
offering. The RMP Incentive Distribution Rights were canceled in
connection with the closing of the acquisition. In the second quarter
RMP had net income of $61.2 million, adjusted EBITDA of $79.7 million,
net cash provided by operating activities of $118.7 million and
distributable cash flow of $68.6 million. In the second quarter
approximately 65% of RMP's adjusted EBITDA was from the Gathering and
Compression segment, with the Water Services segment contributing 35%.

The acquisition of RMP closed prior to the EQM second quarter
distribution record date, therefore the RMP unitholders will receive the
EQM second quarter distribution.

QUARTERLY DISTRIBUTION

EQM

For the second quarter of 2018, EQM will pay a quarterly cash
distribution of $1.09 per unit, which will be paid on August 14, 2018 to
EQM unitholders of record at the close of business on August 3, 2018.
The quarterly cash distribution is 2% higher than the first quarter of
2018 and is 17% higher than the second quarter of 2017.

EQGP

For the second quarter of 2018, EQGP will pay a quarterly cash
distribution of $0.306 per unit, which will be paid on August 23, 2018
to EQGP unitholders of record at the close of business on August 3,
2018. The quarterly cash distribution is 19% higher than the first
quarter of 2018 and is 46% higher than the second quarter 2017
distribution. For the quarter, EQGP expects to receive $94.3 million of
cash distributions from EQM and distribute $92.6 million.

EQM GUIDANCE

Full-year 2018  
Net Income ($MM)* $930 – $970
Adjusted EBITDA ($MM) $980 – $1,020
Distributable Cash Flow ($MM) $800 – $840
 
Q3 2018
Net Income ($MM)* $200 – $215
Adjusted EBITDA ($MM) $265 – $280

* Reflects financial recast for May 2018 Acquisition and RMP.

Please see the Non-GAAP Disclosures section of this news release for
information regarding reconciliations of projected Non-GAAP measures.

Distribution Growth Outlook

EQM now forecasts annual distribution per unit growth of 15% for the
next several years including 2018. EQM is not forecasting any public
equity issuance at least through 2020. EQM expects to continue to grow
the distribution per unit at one of the highest growth rates in the
master limited partnership (MLP) industry, while also remaining focused
on funding growth without compromise to the balance sheet. Over the
long-term, EQM is targeting 3.5x debt to EBITDA, which is an investment
grade metric; and a 1.1x-1.2x distribution coverage ratio.

EQGP now forecasts annual distribution per unit growth of 38% in 2018
followed by annual growth of 30% and 22% in 2019 and 2020, respectively.

EQM EXPANSION & ONGOING MAINTENANCE CAPITAL
EXPENDITURES

Expansion

Expansion capital expenditures and capital contributions to Mountain
Valley Pipeline, LLC (MVP JV), totaled $226 million in the second
quarter 2018 and $468 million year-to-date.

  Three Months Ended Six Months Ended   2018 Full-year
$MM June 30, 2018 June 30, 2018 Forecast*
Mountain Valley Pipeline $66 $183 $1,000 - $1,200
Gathering $139 $250 $750
Transmission $21 $35 $100
Water - - $25
Total $226 $468 $1,875 - $2,075

* Includes full-year May 2018 Acquisition and RMP expansion capital
expenditures. Approximately $51.8 million of expansion capital
expenditures had been spent on the May 2018 Acquisition assets prior to
the May 2018 Acquisition. Approximately $76.9 million of expansion
capital expenditures had been spent on the RMP assets prior to the RMP
acquisition.

Ongoing Maintenance

Ongoing maintenance capital expenditures are cash expenditures made to
maintain, over the long-term, EQM operating capacity or operating
income. EQM ongoing maintenance capital expenditures, net of expected
reimbursements, totaled $7 million in the second quarter 2018 and $11
million year-to-date. EQM forecasts full-year 2018 ongoing maintenance
capital expenditures of $45 million.

PROJECT UPDATE

Mountain Valley Pipeline

On May 22, 2018, the Sierra Club and other opponents filed a Motion to
Stay the Clean Water Act Section 404 stream and wetland crossing permit
(Nationwide 12 permit) issued by the Huntington District of the U.S.
Army Corps of Engineers (USACE). As part of the permit, the USACE
incorporated the West Virginia Special Conditions, which included a
provision that stream and wetland crossings be completed within 72
hours. The Sierra Club argued that MVP cannot comply with the permit
condition to complete four waterbody crossings (Elk, Gauley, Greenbrier,
and Meadow Rivers) within 72 hours.

As interpreted by both MVP and the West Virginia DEP, the 72-hour
provision was intended to apply to water crossings that are constructed
in an open trench while the river is flowing ("wet-cut" method). MVP
plans to utilize a "dry-ditch" coffer dam method to cross the four
rivers as this technique is more protective of the environment as
construction activity is not performed in a flowing river. This crossing
technique has been approved by both the FERC and the West Virginia DEP.

On June 21, 2018, the U.S. Court of Appeals for the Fourth Circuit
issued an order staying the Nationwide 12 permit, which affects water
crossings in approximately 160 miles of the route in West Virginia.
However, prior to the stay issued by the Court, the USACE had suspended
its Nationwide 12 permit for MVP for the four major crossings in West
Virginia to further evaluate whether the time limitation should apply.

After evaluation, the USACE reinstated the Nationwide 12 permit for MVP
on July 3, 2018, concluding that MVP's dry-ditch crossing method is
significantly more protective of the environment and provides more
stringent water quality protection. MVP's dry-ditch crossing method for
the four river crossings is now a requirement of the Nationwide 12
permit, which eliminates the premise of the Sierra Club's argument. On
July 11, 2018, the USACE filed a motion with the Court to lift the stay
of the permit, arguing that its new decision eliminates the legal
predicate for the stay. We expect that the briefing will be complete by
the end of July, after which time the Court will review and rule on the
USACE's motion to lift the stay.

MVP JV has modified its construction schedule and now anticipates a
first quarter 2019 in-service date. The 303-mile pipeline is estimated
to cost $3.5 - $3.7 billion, with EQM funding its 45.5% proportional
share. MVP JV has secured a total of 2 Bcf per day of firm capacity
commitments at 20-year terms.

MVP Southgate

The MVP Southgate project will receive gas from MVP and extend
approximately 70 miles south to new delivery points in Rockingham and
Alamance Counties, North Carolina. The project is anchored by a firm
capacity commitment from PSNC Energy. The preliminary project cost
estimate is $350 to $500 million, depending on final project scope. The
capital is expected to be spent in 2019 and 2020. EQM is expected to
have between 33% and 48% ownership in the project and will operate the
pipeline. Subject to approval by the FERC, MVP Southgate has a targeted
in-service date of the fourth quarter 2020.

Hammerhead Pipeline

The Hammerhead pipeline is designed as a 1.2 Bcf per day gathering
header pipeline that will traverse approximately 55 miles from
southwestern Pennsylvania to Mobley, West Virginia, where both the MVP
and the Ohio Valley Connector originate. The pipeline is estimated to
cost $460 million and is expected to be placed in-service during the
third quarter of 2019.

SENIOR NOTES OFFERING

On June 25, 2018 EQM closed on $2.5 billion in aggregate principal
through the offering of three tranches of senior notes.

  • $1.1 billion of 4.75% senior notes due 2023
  • $850 million of 5.5% senior notes due 2028
  • $550 million of 6.5% senior notes due 2048

EQM utilized the proceeds to repay the 364-day term loan facility, to
repay RMP's revolving credit facility, and for general partnership
purposes.

NON-GAAP DISCLOSURES

EQM Adjusted EBITDA and Distributable Cash Flow

As used in this news release, EQM adjusted EBITDA means net income
attributable to EQM plus net interest expense, depreciation,
amortization of intangible assets, payments on EQM's preferred interest
in EQT Energy Supply, LLC (Preferred Interest), non-cash long-term
compensation expense and transaction costs less equity income, AFUDC -
equity and adjusted EBITDA of assets prior to acquisition. As used in
this news release, distributable cash flow means EQM adjusted EBITDA
less net interest expense excluding interest income on the Preferred
Interest, capitalized interest and AFUDC - debt, ongoing maintenance
capital expenditures net of expected reimbursements and transaction
costs. Distributable cash flow should not be viewed as indicative of the
actual amount of cash that EQM has available for distributions from
operating surplus or that EQM plans to distribute. Adjusted EBITDA and
distributable cash flow are non-GAAP supplemental financial measures
that management and external users of EQM's consolidated financial
statements, such as industry analysts, investors, lenders and rating
agencies, use to assess:

  • EQM'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 EQM's assets to generate sufficient cash flow to make
    distributions to EQM unitholders;
  • EQM'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.

EQM believes that adjusted EBITDA and distributable cash flow provide
useful information to investors in assessing EQM's results of operations
and financial condition. 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 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, EQM's definition
of adjusted EBITDA and distributable cash flow may not be comparable to
similarly titled measures of other companies, thereby diminishing the
utility of the measures. The table below reconciles adjusted EBITDA and
distributable cash flow with net income and net cash provided by
operating activities as derived from the statements of consolidated
operations and cash flows to be included in EQM's quarterly report on
Form 10-Q for the quarter ended June 30, 2018.

EQM is unable to project net cash provided by operating activities or
provide the related reconciliation between projected distributable cash
flow and projected net cash provided by operating activities, the most
comparable financial measure calculated in accordance with GAAP, because
net cash provided by operating activities includes the impact of changes
in operating assets and liabilities. Changes in operating assets and
liabilities relate to the timing of EQM's cash receipts and
disbursements that may not relate to the period in which the operating
activities occurred, and EQM is unable to project these timing
differences with any reasonable degree of accuracy to a specific day,
three or more months in advance. EQM is also unable to provide a
reconciliation of its projected EBITDA to projected net income, the most
comparable financial measure calculated in accordance with GAAP, because
EQM does not provide guidance with respect to the intra-year timing of
its or the MVP JV's capital spending, which impact AFUDC-debt and equity
and equity earnings, among other items, that are reconciling items
between adjusted EBITDA and net income. The timing of capital
expenditures is volatile as it depends on weather, regulatory approvals,
contractor availability, system performance and various other items. EQM
provides a range for the forecasts of net income, adjusted EBITDA and
distributable cash flow to allow for the variability in the timing of
cash receipts and disbursements, capital spending and the impact on the
related reconciling items, many of which interplay with each other.
Therefore, the reconciliations of projected distributable cash flow and
adjusted EBITDA to projected net cash provided by operating activities
and net income are not available without unreasonable effort.

Reconciliation of EQM Adjusted EBITDA and Distributable Cash Flow

  Three Months Ended

(Thousands)

June 30, 2018
 
Net income attributable to EQM $ 172,619
Add:
Net interest expense 20,683
Depreciation 28,076
Amortization of intangible assets 10,387
Preferred Interest payments 2,746
Transaction costs 3,424
Less:
Equity income (10,938 )
AFUDC – equity (1,072 )
Adjusted EBITDA attributable to the May 2018 Acquisition (16,417 )
Adjusted EBITDA $ 209,508  
Less:
Net interest expense excluding interest income on the Preferred
Interest
(22,336 )
Capitalized interest and AFUDC – debt (1,940 )
Ongoing maintenance capital expenditures net of expected
reimbursements
(7,115 )
Transaction costs (3,424 )
Distributable cash flow $ 174,693  
 
Distributions declared (1):
Limited Partner $ 131,295
General Partner 70,510  
Total $ 201,805
Coverage Ratio (2) 0.87x
 
Net cash provided by operating activities $ 220,225
Adjustments:
Capitalized interest and AFUDC – debt (1,940 )
Principal payments received on the Preferred Interest 1,093
Ongoing maintenance capital expenditures net of expected
reimbursements
(7,115 )
Adjusted EBITDA attributable to the May 2018 Acquisition (16,417 )
Other, including changes in working capital (21,153 )
Distributable cash flow $ 174,693  
(1)   Reflects cash distribution of $1.09 per limited partner unit for the
second quarter 2018 and 120,457,148 limited partner units
outstanding as of July 25, 2018. If limited partner units are issued
on or prior to August 3, 2018, the aggregate level of all
distributions will be higher.
(2) The second quarter distributions declared is based on the post RMP
acquisition unit count for EQM, however RMP's distributable cash
flow of $68.6 million is not included in the coverage ratio
calculation. If the RMP distributable cash flow was included, the
coverage ratio would be 1.21x for the second quarter.

RMP Adjusted EBITDA and Distributable Cash Flow

RMP adjusted EBITDA and distributable cash flow are non-GAAP
supplemental financial measures that management and external users of
EQM's consolidated financial statements, such as industry analysts,
investors, lenders and rating agencies, may use to assess impact of the
measures on EQM's future financial results and cash flows.

EQM believes that RMP adjusted EBITDA and distributable cash flow
provide useful information to investors in assessing its financial
condition and results of operations. RMP adjusted EBITDA and
distributable cash flow should not be considered as alternatives to
RMP's net income, operating income, net cash provided by operating
activities or any other measure of financial performance or liquidity
presented in accordance with GAAP. RMP 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 RMP adjusted
EBITDA and distributable cash flow may be defined differently by other
companies in EQM's industry, RMP adjusted EBITDA and distributable cash
flow may not be comparable to similarly titled measures of other
companies, thereby diminishing the utility of the measures.

Reconciliation of RMP Adjusted EBITDA and Distributable Cash Flow

  Three Months Ended

(Thousands)

June 30, 2018
 
Net income $ 61,213
Add:
Net interest expense 2,380
Depreciation 14,034
Non-cash long-term compensation expense 140
Transaction costs 1,926  
Adjusted EBITDA $ 79,693  
Less:
Net interest expense (2,380 )
Capitalized interest (1,252 )
Estimated maintenance capital expenditures (5,500 )
Transaction costs (1,926 )
Distributable cash flow $ 68,635  
 
Net cash provided by operating activities $ 118,725
Adjustments:
Capitalized interest (1,252 )
Estimated maintenance capital expenditures (5,500 )
Other, including changes in working capital (43,338 )
Distributable cash flow $ 68,635  

Q2 2018 Webcast Information

EQM and EQGP will host a joint live webcast with security analysts today
at 11:30 a.m. ET. Topics include second quarter 2018 financial results,
operating results, the midstream streamlining transaction and other
matters. The webcast is available at www.eqtmidstreampartners.com,
with a replay available for seven days following the call.

EQT, which owns EQGP's general partner and holds a 91% limited partner
interest in EQGP, will also host a webcast with security analysts today
at 10:30 a.m. ET. EQM and EQGP unitholders are encouraged to listen to
EQT's webcast, as the discussion may include topics relevant to EQM and
EQGP, such as EQT's financial and operational results, specific
reference to EQM and EQGP second quarter 2018 results and the midstream
streamlining transaction. The webcast can be accessed via www.eqt.com,
with a replay available for seven days following the call.

About EQT Midstream Partners:

EQT Midstream Partners, LP (EQM) is a growth-oriented limited
partnership formed by EQT Corporation to own, operate, acquire, and
develop midstream assets in the Appalachian Basin. As the third largest
gatherer of natural gas in the United States, EQM provides midstream
services to EQT Corporation and third-party companies through its
strategically located natural gas transmission, storage, and gathering
systems, and water services to support energy development and production
in the Marcellus and Utica regions. EQM owns approximately 950 miles of
FERC-regulated interstate pipelines and approximately 2,130 miles of
high-and low-pressure gathering lines.

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

About EQT GP Holdings:

EQT GP Holdings, LP is a limited partnership that owns the general
partner interest, all of the incentive distribution rights, and a
portion of the limited partner interests in EQT Midstream Partners, LP.
EQT Corporation owns the general partner interest and a 91% limited
partner interest in EQT GP Holdings, LP.

Visit EQT GP Holdings, LP at www.eqtmidstreampartners.com.

EQM and EQGP management speak to investors from time to time and the
analyst presentation for these discussions, which is updated
periodically, is available via the EQM and EQGP website at www.eqtmidstreampartners.com.

Cautionary Statements

EQT is not restricted from competing with EQM and may acquire, construct
or dispose of midstream assets without any obligation to offer EQM the
opportunity to purchase or construct the assets.

The distribution amounts from EQM to EQGP are subject to change if EQM
issues additional common units on or prior to the record date for the
second quarter 2018 distribution.

Disclosures in this news release contain certain forward-looking
statements within the meaning of Section 21E of the Securities Exchange
Act of 1934, as amended, and Section 27A of the Securities Act of 1933,
as amended. 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 EQGP
and its subsidiaries, including EQM, including guidance regarding EQM's
gathering, transmission and storage and water revenue and volume growth;
revenue and expense projections; infrastructure programs (including the
timing, cost, capacity and sources of funding with respect to gathering,
transmission and water projects); the cost, capacity, timing of
regulatory approvals and anticipated in-service date of the Mountain
Valley Pipeline (MVP) and MVP Southgate projects; the ultimate terms,
partners and structure of, and EQM's ownership interests in, the MVP
joint venture; the timing of the proposed separation of EQT's production
and midstream businesses, and the parties' ability to complete the
separation; the expected synergies resulting from the streamlining
transaction; asset acquisitions, including EQM's ability to complete any
asset purchases from third parties and anticipated synergies and
accretion associated with any acquisition; the expected benefits to EQM
resulting from EQT's acquisition of Rice Energy Inc. and EQM's
acquisition of RMP; internal rate of return (IRR); compound annual
growth rate (CAGR); capital commitments, projected capital contributions
and capital and operating expenditures, including the amount and timing
of capital expenditures reimbursable by EQT, capital budget and sources
of funds for capital expenditures; liquidity and financing requirements,
including funding sources and availability; distribution amounts, rates
and growth; projected net income, projected adjusted EBITDA, projected
distributable cash flow and projected coverage ratio; the timing and
amount of future issuances of EQM common units under EQM's $750 million
at the market equity distribution program; changes in EQM's credit
ratings; the effects of government regulation and litigation; and tax
position. 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. EQM and EQGP have based these forward-looking statements on
current expectations and assumptions about future events. While EQM and
EQGP consider these expectations and assumptions to be reasonable, they
are inherently subject to significant business, economic, competitive,
regulatory and other risks and uncertainties, many of which are
difficult to predict and beyond the partnerships' control. The risks and
uncertainties that may affect the operations, performance and results of
EQM's and EQGP's business and forward-looking statements include, but
are not limited to, those set forth under Item 1A, "Risk Factors" of
EQM's Form 10-K for the year ended December 31, 2017 as filed with the
Securities and Exchange Commission (SEC) and Item 1A, "Risk Factors" of
EQGP's Form 10-K for the year ended December 31, 2017 as filed with the
SEC, in each case as may be updated by any subsequent Form 10-Qs. Any
forward-looking statement speaks only as of the date on which such
statement is made, and neither EQM nor EQGP intends 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 EQM and EQGP, is derived from publicly
available information published by EQT.

This release serves as qualified notice to nominees under Treasury
Regulation Sections 1.1446-4(b)(4) and (d). Please note that 100% of
EQM's and EQGP's distributions to foreign investors are attributable to
income that is effectively connected with a United States trade or
business. Accordingly, all of EQM's and EQGP's distributions to foreign
investors are subject to federal income tax withholding at the highest
effective tax rate for individuals or corporations, as applicable.
Nominees, and not EQM or EQGP, as applicable, are treated as the
withholding agents responsible for withholding on the distributions
received by them on behalf of foreign investors.

 
EQT MIDSTREAM PARTNERS, LP AND SUBSIDIARIES

STATEMENTS OF CONSOLIDATED OPERATIONS (UNAUDITED) (1)

 
Three Months Ended
June 30,
2018   2017
(Thousands, except per unit amounts)
Operating revenues (2) $ 269,761 $ 196,815
Operating expenses:
Operating and maintenance 24,587 18,315
Selling, general and administrative 24,438 15,812
Depreciation 28,076 21,400
Amortization of intangible assets 10,387    
Total operating expenses 87,488   55,527  
Operating income 182,273 141,288
Equity income 10,938 5,111
Other income 944 1,402
Net interest expense 20,683   8,662  
Net income 173,472 139,139
Net income attributable to noncontrolling interests 853    
Net income attributable to EQM $ 172,619   $ 139,139  
 
Calculation of limited partner interest in net income:
Net income attributable to EQM $ 172,619 $ 139,139
Less pre-acquisition net income allocated to parent (11,407 )
Less general partner interest in net income – general partner units (1,700 ) (2,448 )
Less general partner interest in net income – incentive distribution
rights
(68,121 ) (34,150 )
Limited partner interest in net income $ 91,391   $ 102,541  
 
Net income per limited partner unit – basic and diluted $ 1.09 $ 1.27
Weighted average limited partner units outstanding – basic and
diluted
83,553 80,603
(1)   EQM's consolidated financial statements have been retrospectively
recast to include the pre-acquisition results of Rice Olympus
Midstream LLC (ROM), Strike Force Midstream Holdings LLC (Strike
Force) and Rice West Virginia Midstream LLC (Rice WV), which were
acquired by EQM effective on May 1, 2018 (the May 2018 Acquisition).
(2) Operating revenues included affiliate revenues from EQT of $180.4
million and $148.2 million for the three months ended June 30, 2018
and 2017, respectively.
   
EQT MIDSTREAM PARTNERS, LP AND SUBSIDIARIES

GATHERING RESULTS OF OPERATIONS (1)

 
Three Months Ended
June 30,
2018 2017
FINANCIAL DATA (Thousands, except per day amounts)
Firm reservation fee revenues $ 111,702 $ 101,858
Volumetric based fee revenues:
Usage fees under firm contracts (2) 9,956 6,479
Usage fees under interruptible contracts (3) 58,958 3,808
Total volumetric based fee revenues 68,914 10,287
Total operating revenues 180,616 112,145
Operating expenses:
Operating and maintenance 15,777 10,293
Selling, general and administrative 17,175 8,872
Depreciation 15,646 9,555
Amortization of intangible assets 10,387
Total operating expenses 58,985 28,720
Operating income $ 121,631 $ 83,425
 
OPERATIONAL DATA
Gathering volumes (BBtu per day)
Firm capacity reservation 2,007 1,780
Volumetric based services (4) 2,494 281
Total gathered volumes 4,501 2,061
 
Capital expenditures $ 139,099 $ 53,708
(1)   EQM's consolidated financial statements have been retrospectively
recast to include the pre-acquisition results of the May 2018
Acquisition.
(2) Includes fees on volumes gathered in excess of firm contracted
capacity.
(3) Includes volumes under contracts under which EQM has agreed to hold
capacity available but for which it does not receive a capacity
reservation fee.
(4) Includes volumes gathered under interruptible contracts and volumes
gathered in excess of firm contracted capacity.
 
EQT MIDSTREAM PARTNERS, LP AND SUBSIDIARIES

TRANSMISSION RESULTS OF OPERATIONS (1)

 
Three Months Ended
June 30,
2018   2017
FINANCIAL DATA (Thousands, except per day amounts)
Firm reservation fee revenues $ 82,222 $ 79,512
Volumetric based fee revenues:
Usage fees under firm contracts (2) 4,828 3,503
Usage fees under interruptible contracts 2,095 1,655
Total volumetric based fee revenues 6,923 5,158
Total operating revenues 89,145 84,670
Operating expenses:
Operating and maintenance 8,810 8,022
Selling, general and administrative 7,263 6,940
Depreciation 12,430 11,845
Total operating expenses 28,503 26,807
Operating income $ 60,642 $ 57,863
 
Equity income $ 10,938 $ 5,111
 
OPERATIONAL DATA
Transmission pipeline throughput (BBtu per day)
Firm capacity reservation 2,826 2,218
Volumetric based services (3) 41 21
Total transmission pipeline throughput 2,867 2,239
 
Average contracted firm transmission reservation commitments (BBtu
per day)
3,607 3,341
 
Capital expenditures $ 27,962 $ 29,978
(1)   EQM's consolidated financial statements have been retrospectively
recast to include the pre-acquisition results of the May 2018
Acquisition.
(2) Includes fees on volumes transported in excess of firm contracted
capacity as well as commodity charges and fees on all volumes
transported under firm contracts.
(3) Includes volumes transported under interruptible contracts and
volumes transported in excess of firm contracted capacity.
 
EQT MIDSTREAM PARTNERS, LP AND SUBSIDIARIES

CAPITAL EXPENDITURE SUMMARY (1)

 
Three Months Ended
June 30,
2018   2017
(Thousands)
Expansion capital expenditures (2) $ 159,968 $ 80,224
Ongoing maintenance capital expenditures 7,093 3,462
Total capital expenditures $ 167,061 $ 83,686
(1)   EQM's consolidated financial statements have been retrospectively
recast to include the pre-acquisition results of the May 2018
Acquisition.
(2) Expansion capital expenditures do not include capital contributions
made to the MVP JV of $65.8 million and $40.2 million for the three
months ended June 30, 2018 and 2017, respectively.
 
EQT GP HOLDINGS, LP AND SUBSIDIARIES

STATEMENTS OF CONSOLIDATED OPERATIONS (UNAUDITED) (1)

 
Three Months Ended
June 30,
2018   2017
(Thousands, except per unit amounts)
Operating revenues (2) $ 269,761 $ 196,815
Operating expenses:
Operating and maintenance 24,587 18,315
Selling, general and administrative 26,369 16,401
Depreciation 28,076 21,400
Amortization of intangible assets 10,387  
Total operating expenses 89,419   56,116
Operating income 180,342 140,699
Equity income 10,938 5,111
Other income 944 1,402
Net interest expense 20,659   8,658
Net income 171,565 138,554
Net income attributable to noncontrolling interests 68,269   75,224
Net income attributable to EQGP $ 103,296   $ 63,330
 
Calculation of limited partner interest in net income:
Net income attributable to EQGP $ 103,296 $ 63,330
Less pre-acquisition net income allocated to parent (11,407 )
Limited partner interest in net income $ 91,889   $ 63,330
 
Net income per common unit – basic and diluted $ 0.32 $ 0.24
Weighted average common units outstanding – basic and diluted 284,343 266,186
(1)   EQGP's consolidated financial statements have been retrospectively
recast to include the pre-acquisition results of the May 2018
Acquisition.
(2) Operating revenues included affiliate revenues from EQT of $180.4
million and $148.2 million for the three months ended June 30, 2018
and 2017, respectively.

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