Updated: EQT to acquire Range Resources for $13 billion, creating a leading US natural gas producer

Paragraphs 6 and 17 supplement with detailed information from the conference call, and paragraph 11 updates the stock price information.

Sumit Saha

Reuters, October 26 - EQT (EQT.N) announced on Monday that it would acquire Range Resources (RRC.N) in an all-stock deal valued at $13 billion, establishing the largest natural gas producer in the United States. The move aims to bet on growing demand for liquefied natural gas (LNG) exports and power generation.

The deal merges two major producers in the Appalachian Basin, giving EQT greater scale and infrastructure to better serve utility companies, LNG exporters, and industrial customers.

After including debt, the merged enterprise value will exceed $50 billion.

Driven by LNG exports and surging demand from artificial intelligence data centers, U.S. natural gas consumption is expected to hit an all-time high.

The U.S. Energy Information Administration forecasts domestic natural gas consumption will rise from 91.9 billion cubic feet per day (bcfd) in 2025 to 94.3 billion cubic feet per day in 2027.

EQT CEO Toby Rice said on the conference call that the company now expects potential natural gas demand in the Appalachian region to rise to 25 bcfd, compared with a previous estimate of 20 bcfd.

The merged company will have daily net output exceeding 9 billion cubic feet equivalent (bcfed), nearly 3 million net acres of land, drilling reserves sufficient for over 30 years of production, and more than 3,700 miles of midstream infrastructure.

Competitor Expand Energy EXE.O expects 2025 output of about 7.2 bcfed, rising to 7.4-7.6 bcfed in 2026.

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Range Resources shareholders will receive 0.987 shares of EQT for each share held, valuing the deal at $12.83 billion, or $54.91 per share, a 20.6% premium to Friday’s closing price, according to Reuters' calculations.

EQT shares fell 2.3%, while Range Resources shares rose 16.7% to $53.14.

In the merged company, EQT shareholders will own about 73% of the shares and Range investors will hold the remaining 27%. The transaction is expected to close in the first quarter of 2027.

Based on recent market prices, the merged company is expected to generate about $20 billion in cumulative free cash flow within five years.

The deal is also expected to lower EQT’s unlevered free cash flow breakeven to below $2 per million British thermal units (MMBtu), helping maintain profitability amid natural gas price volatility.

Rice said future production growth will be driven by customer demand rather than output targets, adding that achieving mid-single-digit growth is feasible.

EQT's management team will lead the combined company, which will remain headquartered in Canonsburg, Pennsylvania.

Two Range representatives, including CEO Dennis Degner, will join the EQT board of directors.

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