EQT Corp. has sold the Big Sandy Pipeline to Spectra Energy Partners, LP for $390 million. Big Sandy is a 70-mile, 20-inch natural gas pipeline placed in service in April 2008. It has a capacity of 171,000 Dth/d. Big Sandy transports natural gas from the Langley, KY natural gas processing complex ultimately to the Mid-Atlantic and Northeast markets.
“The sale of our Big Sandy Pipeline is another step in our commitment to prioritize our capital and accelerate our most profitable investment opportunities, which means primarily Marcellus and also Huron development activities. We will continue to fund this acceleration through our operating cash flow, additional asset sales and available debt capacity,” said David Porges, chairman, president and CEO. “We have contracted for capacity to ensure delivery of our growing Huron production and look forward to working with Spectra Energy Partners.”
EQT will invest most of the proceeds to develop its 520,000 Marcellus acres, including associated midstream gathering; and to develop its extensive Huron reserves. EQT now expects to drill 100 Marcellus wells and 120 Huron wells in 2011. Its 2011 CAPEX forecast is increased to between $1.2-1.25 billion of which 75% will be used for well development. As a result of this additional investment, EQT is increasing its 2011 production sales volume guidance to between 185-190 Bcfe; and establishes a preliminary 2012 volume target of between 245-250 Bcfe.