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Equinor swaps onshore assets in the US

The picture shows a natural gas well pad facilities in the Appalachian Basin, US.
Natural gas well pad facilities in the Appalachian Basin, US
Photo: Stuart Conway / Equinor

Equinor and EQT Corporation have agreed to swap Equinor’s operated position in the Marcellus and Utica shale formations in Ohio for a stake in EQT’s non-operated interest in the Northern Marcellus formation.

Under the transaction agreement, Equinor will sell 100% interest in and operatorship of its onshore asset in the Appalachian Basin, located in southeastern Ohio, in exchange for 40% of EQT’s non-operated working interest in the Northern Marcellus shale formation in Pennsylvania.

Equinor will pay a cash consideration of USD 500 million to EQT to balance the overall transaction, swapping for resources that contribute to growing cashflows and further reducing CO2 emissions intensity in the international portfolio.

Following the transaction, Equinor will increase its average working interest from 15.7% to 25.7% in certain Chesapeake-operated Northern Marcellus gas units. To cover pre-existing gas sales commitments, Equinor will enter a gas buy-back agreement with EQT.

Philippe Mathieu - portrait
Philippe Mathieu, executive vice president for Exploration and Production International at Equinor
Photo: Sheyda Aalgaard / Equinor

“With this transaction, we continue to high-grade the US portfolio and improve profitability by strengthening our gas position in the most robust part of the Appalachian Basin. These assets are well positioned to leverage anticipated positive developments in the US gas market. The proposed swap improves portfolio robustness with an expected reduction in well break-evens and upstream carbon intensity. This also means that we have now fully exited all operated positions onshore US,” says Philippe Mathieu, executive vice president for Exploration and Production International at Equinor.

“The US is a core area for Equinor where we’re building a broad energy business within offshore and onshore oil and gas, offshore wind, and new low-carbon value chains,” says Mathieu.

Since 2020, Equinor’s US business has recorded USD 11 billion in earnings. Prior to this transaction, the Appalachian Basin operated position was the last remaining operatorship held by Equinor in the US onshore.

EQT Corporation is the largest producer of natural gas in the US with operations in Pennsylvania, West Virginia and Ohio.

Final completion will, among other things, be dependent on approval by relevant authorities.