[X]
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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[ ]
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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DELAWARE
(State or other jurisdiction of incorporation or organization)
625 Liberty Avenue, Suite 1700
Pittsburgh, Pennsylvania
(Address of principal executive offices)
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37-1661577
(IRS Employer Identification No.)
15222
(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Common Units Representing Limited Partner Interests
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New York Stock Exchange
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Large accelerated filer
x
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
¨
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PART I
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Item 1
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Item 1A
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Item 1B
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Item 2
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Item 3
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Item 4
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PART II
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Item 5
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Item 6
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Item 7
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Item 7A
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Item 8
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Item 9
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Item 9A
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Item 9B
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PART III
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Item 10
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Item 11
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Item 12
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Item 13
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Item 14
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PART IV
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Item 15
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•
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NWV Gathering Acquisition
. On March 17, 2015, EQT contributed NWV Gathering to EQM Gathering. EQM paid total consideration of $925.7 million to EQT, consisting of approximately $873.2 million in cash, 511,973 EQM common units and 178,816 EQM general partner units. As of
December 31, 2015
, NWV Gathering consisted of approximately 85 miles of high pressure natural gas gathering pipeline and 11 compressor units with approximately 34,500 horsepower of compression and a wet gas header pipeline, which is an approximately 30-mile high pressure pipeline that receives wet gas from development areas in northern West Virginia and provides delivery to the MarkWest Mobley processing facility. The NWV Gathering assets also interconnect with EQM's transmission and storage system and had firm gathering capacity of approximately 560 MMcf per day as of
December 31, 2015
.
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•
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MVP Interest Acquisition
. On March 30, 2015, EQM assumed 100% of the membership interests in MVP Holdco, LLC (MVP Holdco), the owner of the interest (the MVP Interest) in Mountain Valley Pipeline, LLC (MVP Joint Venture), which at the time was an indirect wholly owned subsidiary of EQT. EQM paid EQT approximately $54.2 million which was equal to 100% of the capital contributions made by EQT to the MVP Joint Venture as of March 30, 2015. During 2015, ownership interests totaling 11% in the MVP Joint Venture were sold for reimbursement of capital contributions. In January 2016, EQM sold 8.5% of its ownership interest in the MVP Joint Venture for reimbursement of $12.5 million of capital contributions. The counterparty to this sale has the right to terminate its purchase of the interest in the MVP Joint Venture and be reimbursed for the purchase price and all capital contributions it makes to the MVP Joint Venture for a period ending no later than December 31, 2016.
As of February 11, 2016, EQM owned a 45.5% interest in the MVP Joint Venture. See further discussion of the Mountain Valley Pipeline (MVP) project in the Transmission and Storage System discussion.
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•
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Preferred Interest Acquisition
. On April 15, 2015, pursuant to the NWV Gathering Acquisition contribution and sale agreement, EQM acquired a preferred interest (the Preferred Interest) in EQT Energy Supply, LLC (EES), which at the time was an indirect wholly owned subsidiary of EQT, from EQT for approximately $124.3 million. EES generates revenue from services provided to a local distribution company.
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•
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March Offering
. On March 17, 2015, EQM completed an underwritten public offering of 8,250,000 common units. On March 18, 2015, the underwriters exercised their option to purchase 1,237,500 additional common units on the same terms as the offering. EQM received net proceeds of approximately
$696.6 million
after deducting the underwriters' discount and offering expenses. EQM used the net proceeds from the offering and borrowings under EQM's credit facility to finance the cash consideration paid to EQT in connection with the NWV Gathering Acquisition.
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•
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ATM Offerings
. During the third quarter of 2015, EQM entered into an equity distribution agreement that established an At the Market common unit offering program, pursuant to which a group of managers, acting as EQM's sales agents, may sell EQM common units having an aggregate offering price of up to $750 million (the $750 million ATM Program). During the third and fourth quarters of 2015, EQM issued
1,162,475
common units at an average price per unit of
$74.92
. EQM received net proceeds of approximately
$85.5 million
which were used for general partnership purposes.
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•
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November Offering
. On November 16, 2015, EQM completed an underwritten public offering of
5,650,000
common units. EQM received net proceeds of
$399.9 million
after deducting the underwriters' discount and offering expenses. The net proceeds will be used for general partnership purposes, including to fund a portion of EQM's anticipated 2016 capital expenditures related to transmission and gathering expansion projects and to repay amounts outstanding under EQM's credit facility.
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System
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Approximate
Number of Miles |
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Approximate
Number of Receipt Points |
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Approximate
Compression (Horsepower) |
Transmission and storage
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700
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80
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69,000
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AVC (leased transmission and storage)
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200
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70
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13,000
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Gathering
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1,685
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2,300
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127,000
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•
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Ohio Valley Connector
. The Ohio Valley Connector (OVC)
is a 37-mile pipeline that will extend EQM's transmission and storage system from northern West Virginia to Clarington, Ohio, at which point it will interconnect with the Rockies Express Pipeline and may interconnect with other pipelines and liquidity points. The OVC will provide approximately 850 BBtu per day of transmission capacity with an aggregate compression of approximately 38,000 horsepower and is estimated to cost $350 million to $380 million, of which $210 million to $220 million is expected to be spent in 2016. EQT has entered into a 20-year precedent agreement with EQM for a total of 650 BBtu per day of firm transmission capacity on the OVC. EQM received its FERC certificate to construct and operate the OVC on December 30, 2015 and construction began in January 2016. EQM expects the OVC to be in-service by year-end 2016.
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•
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Transmission Expansion Projects
.
EQM is evaluating several multi-year transmission capacity expansion projects to support production growth in the Marcellus and Utica Shales that could total an additional 1.5 Bcf per day of capacity by year-end 2018. The projects may include additional compression, pipeline looping and new header pipelines. EQM expects to spend approximately $25 million on these expansion projects during 2016.
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Mountain Valley Pipeline
.
The MVP Joint Venture is a joint venture with affiliates of each of NextEra Energy, Inc., Consolidated Edison, Inc. (ConEd), WGL Holdings, Inc.,Vega Energy Partners, Ltd. and RGC Resources, Inc. As of February 11, 2016, EQM owned a 45.5% interest in the MVP Joint Venture and had assumed the role of operator of the MVP to be constructed by the joint venture. The estimated 300-mile MVP is currently targeted at 42 inches in diameter and a capacity of 2.0 Bcf per day, and will extend from EQM's existing transmission and storage system in Wetzel County, West Virginia to Pittsylvania County, Virginia. As currently designed, the MVP is estimated to cost a total of $3.0 billion to $3.5 billion, excluding AFUDC, with EQM funding its proportionate share through capital contributions made to the joint venture. In 2016, EQM expects to provide capital contributions of approximately $150 million to the MVP Joint Venture, primarily in support of material orders, environmental and land assessments and engineering design work. Expenditures are expected to increase substantially as construction commences, with the bulk of the expenditures expected to be made in 2017 and 2018. On January 21, 2016, affiliates of ConEd acquired a 12.5% interest in the MVP Joint Venture and entered into 20-year firm capacity commitments for approximately 0.25 Bcf per day on both the MVP and EQM’s transmission system. ConEd has the right to terminate its purchase of the interest in the MVP Joint Venture and be reimbursed for the purchase price and all capital contributions it makes to the MVP Joint Venture for a period ending no later than December 31, 2016. The MVP Joint Venture has secured a total of 2.0 Bcf per day of 20-year firm capacity commitments, including a 1.29 Bcf per day firm capacity commitment by EQT, and is currently in negotiation with additional shippers who have expressed interest in the MVP project. The MVP Joint Venture submitted the MVP certificate application to the FERC in October 2015 and anticipates receiving the certificate in the fourth quarter of 2016. Subject to FERC approval, construction is scheduled to begin shortly thereafter and the pipeline is expected to be in-service during the fourth quarter of 2018.
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•
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Jupiter Development Area
. EQM spent approximately
$75 million
in 2015 related to expansion in the Jupiter development area primarily located in Greene and Washington counties of Pennsylvania that raised total firm gathering capacity in that area to 775 MMcf per day, which is fully subscribed.
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NWV Gathering Development Area
. EQM spent approximately
$74 million
in 2015 related to expansion in the NWV Gathering development area primarily located in Doddridge and Wetzel counties of West Virginia that raised total firm gathering capacity in that area to 560 MMcf per day as of December 31, 2015, which is fully subscribed.
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•
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Third Party Projects
. EQM spent approximately
$30 million
in 2015 related to gathering infrastructure to support third party producers, primarily serving Range Resources Corporation's (Range Resources) production development in eastern Washington County, Pennsylvania under an agreement signed in 2014.
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•
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Range Resources Header Pipeline Project
.
In July 2015, EQM announced its agreement with a subsidiary of Range Resources to construct a natural gas header pipeline in southwestern Pennsylvania to support Marcellus and Utica development. The pipeline is expected to cost approximately $250 million and is contracted to provide 550 MMcf per day of firm capacity backed by a ten-year firm capacity reservation commitment. EQM plans to complete the project in two phases, with phase one expected to be in-service during the second half of 2016 and phase two during the first half of 2017. EQM expects to invest approximately $195 million to $205 million on the project in 2016.
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NWV Gathering and Jupiter Development Areas
.
EQM expects to invest a total of approximately $370 million, of which approximately $95 million to $105 million is expected to be spent during 2016, related to expansion in the NWV Gathering development area. These expenditures are part of a fully subscribed expansion project expected to raise total firm gathering capacity in the NWV Gathering development area to 640 MMcf per day by mid-year 2017. EQM also plans to invest approximately $20 million in the Jupiter development area to install gathering pipeline that will extend the gathering system to include additional EQT Production development areas in Greene County, Pennsylvania.
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Revenue Composition %
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Firm Contracts
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Interruptible Contracts
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Capacity
Reservation
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Usage
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Usage
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Charges
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Charges
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Fees
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Total
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Transmission and storage
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40%
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7%
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1%
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48%
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Gathering
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42%
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5%
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5%
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52%
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•
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Capitalizing on economically attractive organic growth opportunities.
EQM believes that organic projects will be a key driver of growth in the future. EQM expects to grow its systems over time by meeting EQT’s and third party customers’ midstream service needs that result from their drilling activity in EQM’s areas of operations. EQT’s acreage dedication to EQM’s assets and EQT’s economic relationship with EQM provide a platform for organic growth. In addition, EQM intends to leverage EQT’s knowledge of, and expertise in, the Marcellus Shale in order to target and efficiently execute economically attractive organic growth projects for third party customers, although EQT is under no obligation to share such knowledge and expertise with EQM. EQM will evaluate organic expansion and greenfield construction opportunities in existing and new markets that it believes will increase the volume of transmission, storage and gathering capacity subscribed on its systems. As production increases in EQM's areas of operations, EQM believes that it will have a competitive advantage in pursuing economically attractive organic expansion projects.
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Increasing access to existing and new delivery markets.
EQM is actively working to increase delivery interconnects with interstate pipelines, neighboring LDCs, large industrial facilities and electric generation plants in order to increase access to existing and new markets for natural gas consumption. In 2015, EQM began several multi-year transmission expansion projects to support Marcellus and Utica Shale development, including the OVC and other transmission expansion projects. Upon completion of the OVC and the transmission expansion projects, EQM's transmission capacity is expected to approximate 5.0 Bcf per day by year-end 2018. Additionally, the MVP is expected to have at least 2.0 Bcf per day of capacity when it is complete.
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Pursuing accretive acquisitions from EQT and third parties
. EQM intends to seek opportunities to expand its existing natural gas transmission, storage and gathering operations through accretive acquisitions from EQT and third parties, though EQT is under no obligation to offer acquisition opportunities to EQM. These opportunities may include EQT’s retained transmission assets, which consist of the AVC facilities, and EQT’s retained high pressure gathering assets including gathering lines serving the Marcellus Shale. EQM will also evaluate and may pursue acquisition opportunities from third parties as they become available.
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Attracting additional third party volumes.
EQM actively markets its midstream services to, and pursues strategic relationships with, third party producers in order to attract additional volumes and/or expansion opportunities. EQM believes that its connectivity to interstate pipelines, which is a key feature of a header system transmission pipeline, as well as its position as an early developer of midstream infrastructure within certain areas of the Marcellus and Utica Shales, will allow EQM to capture additional third party volumes in the future. EQM anticipates that organic growth projects that it pursues for EQT, or assets it acquires from EQT, generally will be constructed in a manner that leverages economies of scale to allow for incremental third party volumes in excess of capacity amounts needed by EQT.
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Focusing on stable, fixed-fee business.
EQM intends to pursue additional opportunities to provide fixed-fee transmission, storage and gathering services to EQT and third parties. This contract structure enhances the stability of EQM’s cash flows and limits its direct exposure to commodity price risk. EQM will focus on obtaining additional long-term firm commitments from customers, which may include reservation-based fees, volume commitments and acreage dedications.
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EQT is a leader among exploration and production companies in the Appalachian Basin.
A substantial portion of EQT’s drilling efforts in recent years were focused on drilling horizontal wells in the Marcellus Shale formations of southwestern Pennsylvania and northern West Virginia. For the year ended
December 31, 2015
, EQT reported total production sales volumes of
603
Bcfe, representing a
27%
increase compared to the year ended
December 31, 2014
. Approximately
84%
of EQT’s total production in
2015
was from wells in the Marcellus Shale. EQT's Marcellus sales volumes were
34%
higher for the year ended
December 31, 2015
as compared to the year ended
December 31, 2014
.
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EQT has retained certain midstream assets.
EQM expects to have the opportunity to purchase additional midstream assets from EQT in the future, although EQT is under no obligation to make the opportunities available to EQM. The opportunities are expected to include the retained transmission and gathering assets previously described.
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EQT production growth supports EQM's development of organic expansion projects
. EQT continues to expand its exploration and production operations in the Appalachian Basin, in the Marcellus and Utica Shales. As this expansion increases into areas that are currently underserved by midstream infrastructure, EQM expects it will have a competitive advantage in pursuing economically attractive organic expansion projects, which EQM believes will be a key driver of growth in the future.
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requiring the acquisition of various permits to conduct regulated activities;
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requiring the installation of pollution-control equipment or otherwise restricting the way EQM can handle or dispose of its wastes;
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limiting or prohibiting construction activities in sensitive areas, such as wetlands, coastal regions or areas inhabited by endangered or threatened species; and
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requiring investigatory and remedial actions to mitigate or eliminate pollution conditions caused by EQM’s operations or attributable to former operations.
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For the year ended December 31,
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2015
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2014
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2013
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Transmission and storage operating revenues
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48
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%
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53
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%
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49
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%
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Gathering operating revenues
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52
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%
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47
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%
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51
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%
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natural gas price volatility or a sustained period of lower commodity prices may have an adverse effect on EQT's drilling operations, revenue, profitability, future rate of growth and liquidity;
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a reduction in or slowing of EQT's anticipated drilling and production schedule, which would directly and adversely impact demand for EQM's services;
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infrastructure capacity constraints and interruptions;
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risks associated with the operation of EQT's wells, pipelines and facilities, including potential environmental liabilities;
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the availability of capital on a satisfactory economic basis to fund EQT's operations;
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EQT's ability to identify exploration, development and production opportunities based on market conditions;
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uncertainties inherent in projecting future rates of production;
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EQT's ability to develop additional reserves that are economically recoverable, to optimize existing well production and to sustain production;
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adverse effects of governmental and environmental regulation and negative public perception regarding EQT's operations; and
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the loss of key personnel.
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the rates we charge for our transmission, storage and gathering services;
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the level of firm transmission, storage and gathering capacity sold and volumes of natural gas we transport, store and gather for our customers;
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regional, domestic and foreign supply and perceptions of supply of natural gas; the level of demand and perceptions of demand in our end-use markets; and actual and anticipated future prices of natural gas and other commodities (and the volatility thereof), which may impact our ability to renew and replace firm transmission, storage and gathering agreements;
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the effect of seasonal variations in temperature on the amount of natural gas that we transport, store and gather;
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the level of competition from other midstream energy companies in our geographic markets;
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the creditworthiness of our customers;
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restrictions contained in our joint venture agreements;
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the level of our operating, maintenance and general and administrative costs;
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regulatory action affecting the supply of, or demand for, natural gas, the rates we can charge on our assets, how we contract for services, our existing contracts, our operating costs or our operating flexibility; and
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prevailing economic conditions.
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the level and timing of capital expenditures we make;
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the level of our operating and general and administrative expenses, including reimbursements to our general partner and its affiliates, including EQT, for services provided to us;
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the cost of acquisitions, if any;
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our debt service requirements and other liabilities;
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fluctuations in our working capital needs;
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our ability to borrow funds and access capital markets on satisfactory terms;
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restrictions on distributions contained in our debt agreements;
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the amount of cash reserves established by our general partner; and
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other business risks affecting our cash levels.
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rates and charges for our natural gas transmission and storage and FERC-regulated gathering services;
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certification and construction of new interstate transmission and storage facilities;
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abandonment of interstate transmission and storage services and facilities;
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maintenance of accounts and records;
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relationships between pipelines and certain affiliates;
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terms and conditions of services and service contracts with customers;
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depreciation and amortization policies;
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acquisitions and dispositions of interstate transmission and storage facilities; and
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initiation and discontinuation of interstate transmission and storage services.
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the level of existing and new competition to provide services to our markets;
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the macroeconomic factors affecting natural gas economics for our current and potential customers;
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the balance of supply and demand, on a short-term, seasonal and long-term basis, in our markets;
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the extent to which the customers in our markets are willing to contract on a long-term basis; and
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the effects of federal, state or local regulations on the contracting practices of our customers.
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an inability to identify attractive expansion projects;
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an inability to obtain necessary rights-of-way or permits or other government approvals, including approvals by regulatory agencies;
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an inability to successfully integrate the infrastructure we build;
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an inability to raise financing for expansion projects on economically acceptable terms;
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incorrect assumptions about volumes, revenues and costs, including potential growth; or
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an inability to secure adequate customer commitments to use the newly expanded facilities.
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mistaken assumptions about volumes, revenues and costs, including synergies and potential growth;
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an inability to secure adequate customer commitments to use the acquired systems or facilities;
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an inability to integrate successfully the assets or businesses we acquire;
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the assumption of unknown liabilities for which we are not indemnified or for which our indemnity is inadequate;
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the diversion of management’s and employees’ attention from other business concerns; and
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unforeseen difficulties operating in new geographic areas or business lines.
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damage to pipelines, facilities, equipment and surrounding properties caused by hurricanes, earthquakes, tornadoes, floods, fires and other natural disasters and acts of terrorism;
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inadvertent damage from construction, vehicles, and farm and utility equipment;
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uncontrolled releases of natural gas and other hydrocarbons;
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leaks, migrations or losses of natural gas as a result of the malfunction of equipment or facilities and, with respect to storage assets, as a result of undefined boundaries, geologic anomalies, natural pressure migration and wellbore migration;
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ruptures, fires and explosions; and
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other hazards that could also result in personal injury and loss of life, pollution to the environment and suspension of operations.
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perform ongoing assessments of pipeline integrity;
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identify and characterize applicable threats to pipeline segments that could impact a high consequence area;
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maintain processes for data collection, integration and analysis;
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repair and remediate pipelines as necessary; and
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implement preventive and mitigating actions.
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incur or guarantee additional debt;
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make distributions on or redeem or repurchase units;
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make certain investments and acquisitions;
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incur certain liens or permit them to exist;
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enter into certain types of transactions with affiliates;
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merge or consolidate with another company; and
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transfer, sell or otherwise dispose of assets.
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our ability to obtain additional financing, if necessary, for working capital, capital expenditures, acquisitions or other purposes may be impaired or such financing may not be available on favorable terms;
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our funds available for operations, future business opportunities and distributions to unitholders will be reduced by that portion of our cash flow required to make interest payments on our debt;
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we may be more vulnerable to competitive pressures or a downturn in our business or the economy generally; and
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our flexibility in responding to changing business and economic conditions may be limited.
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Neither our partnership agreement nor any other agreement requires EQT to pursue a business strategy that favors us, and the directors and officers of EQT have a fiduciary duty to make these decisions in the best interests of
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EQT, as our primary customer, has an economic incentive to cause us not to seek higher tariff rates or gathering fees, even if such higher rates or fees would reflect rates and fees that could be obtained in arms length, third party transactions.
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EQT is not limited in its ability to compete with us and may offer business opportunities or sell midstream assets to third parties without first offering us the right to bid for them.
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Our general partner is allowed to take into account the interests of parties other than us, such as EQT, in resolving conflicts of interest, which has the effect of limiting its state law fiduciary duty to our unitholders.
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All of the officers and a majority of the directors of our general partner are also officers and/or directors of EQT and owe fiduciary duties to EQT, and four of the officers and three of the directors of our general partner are also officers and/or directors of EQGP’s general partner and owe fiduciary duties to EQM. The officers of our general partner also devote significant time to the business of EQT and EQM and are compensated by EQT accordingly.
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Our general partner determines whether or not we incur debt and that decision may affect our credit ratings.
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Our partnership agreement replaces the fiduciary duties that would otherwise be owed by our general partner with contractual standards governing its duties, limits our general partner’s liabilities and restricts the remedies available to our unitholders for actions that, without such limitations, might constitute breaches of fiduciary duty under state law.
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Except in limited circumstances, our general partner has the power and authority to conduct our business without unitholder approval.
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Our general partner controls the enforcement of the obligations that it and its affiliates owe to us, including EQT’s obligations under our omnibus agreement with EQT and EQT’s commercial agreements with us.
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Disputes may arise under our commercial agreements with EQT and its affiliates.
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Our partnership agreement gives our general partner broad discretion in establishing financial reserves for the proper conduct of our business. These reserves will affect the amount of cash available for distribution to our unitholders.
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Our general partner determines the amount and timing of asset purchases and sales, borrowings, issuances of additional partnership securities and the creation, reduction or increase of reserves, each of which can affect the amount of cash available for distribution to our unitholders.
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Our general partner determines the amount and timing of any capital expenditures and whether a capital expenditure is classified as a maintenance capital expenditure, which reduces operating surplus, or an expansion or investment capital expenditure, which does not reduce operating surplus. This determination can affect the amount of cash that is distributed to our unitholders.
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Our general partner determines which costs incurred by it and its affiliates are reimbursable by us.
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Our general partner may cause us to borrow funds in order to permit the payment of cash distributions, even if the purpose or effect of the borrowing is to make incentive distributions.
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Our partnership agreement permits us to classify up to $30 million as operating surplus, even if it is generated from asset sales, non-working capital borrowings or other sources that would otherwise constitute capital surplus. This cash may be used to fund distributions to our general partner in respect of the general partner interest or the IDRs.
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Our partnership agreement does not restrict our general partner from causing us to pay it or its affiliates for any services rendered to us or entering into additional contractual arrangements with any of these entities on our behalf.
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Our general partner intends to limit its liability regarding our contractual and other obligations.
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Our general partner may exercise its right to call and purchase all of our common units not owned by it and its affiliates if they own more than 80% of the common units.
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Our general partner decides whether to retain separate counsel, accountants or others to perform services for us.
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Our general partner may transfer the IDRs without unitholder approval.
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Our general partner may elect to cause us to issue common units to it in connection with a resetting of the target distribution levels related to our general partner’s IDRs without the approval of the conflicts committee of the board of directors of our general partner or our unitholders. This election may result in lower distributions to our common unitholders in certain situations.
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how to allocate corporate opportunities among us and its affiliates;
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whether to exercise its limited call right;
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whether to seek approval of the resolution of a conflict of interest by the conflicts committee of the board of directors of our general partner;
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how to exercise its voting rights with respect to the units it owns;
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whether to elect to reset target distribution levels;
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whether to transfer the IDRs or any units it owns to a third party; and
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whether or not to consent to any merger, consolidation or conversion of the partnership or amendment to the partnership agreement.
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•
|
whenever our general partner, the board of directors of our general partner or any committee thereof (including the conflicts committee) makes a determination or takes, or declines to take, any other action in their respective capacities, our general partner, the board of directors of our general partner and any committee thereof (including the conflicts committee), as applicable, is required to make such determination, or take or decline to take such other action, in good faith, meaning that it subjectively believed that the decision was in the best interests of our partnership, and, except as specifically provided by our partnership agreement, will not be subject to any other or different standard imposed by our partnership agreement, Delaware law, or any other law, rule or regulation, or at equity;
|
•
|
our general partner will not have any liability to us or our unitholders for decisions made in its capacity as a general partner so long as such decisions are made in good faith;
|
•
|
our general partner and its officers and directors will not be liable for monetary damages to us or our limited partners resulting from any act or omission unless there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that our general partner or its officers and directors, as the case may be, acted in bad faith or engaged in fraud or willful misconduct or, in the case of a criminal matter, acted with knowledge that the conduct was criminal; and
|
•
|
our general partner will not be in breach of its obligations under our partnership agreement (including any duties to us or our unitholders) if a transaction with an affiliate or the resolution of a conflict of interest is:
|
◦
|
approved by the conflicts committee of the board of directors of our general partner, although our general partner is not obligated to seek such approval;
|
◦
|
approved by the vote of a majority of our outstanding common units, excluding any common units owned by our general partner and its affiliates;
|
◦
|
determined by the board of directors of our general partner to be on terms no less favorable to us than those generally being provided to or available from unrelated third parties; or
|
◦
|
determined by the board of directors of our general partner to be fair and reasonable to us, taking into account the totality of the relationships among the parties involved, including other transactions that may be particularly favorable or advantageous to us.
|
•
|
our existing unitholders’ proportionate ownership interest in us will decrease;
|
•
|
the amount of distributable cash flow on each unit may decrease;
|
•
|
because the amount payable to holders of IDRs is based on a percentage of the total distributable cash flow, the distributions to holders of IDRs will increase even if the per unit distribution on common units remains the same;
|
•
|
the ratio of taxable income to distributions may increase;
|
•
|
the relative voting strength of each previously outstanding unit may be diminished; and
|
•
|
the market price of the common units may decline.
|
•
|
we were conducting business in a state but had not complied with that particular state’s partnership statute; or
|
•
|
such unitholder's right to act with other unitholders to remove or replace our general partner, to approve some amendments to our partnership agreement or to take other actions under our partnership agreement constitutes “control” of our business.
|
|
|
2015
|
|
2014
|
||||||||||||||||||||
|
|
Unit Price Range
|
|
Distributions
|
|
Unit Price Range
|
|
Distributions
|
||||||||||||||||
|
|
|
|
|
|
per Common
|
|
|
|
|
|
per Common
|
||||||||||||
|
|
High
|
|
Low
|
|
Unit
|
|
High
|
|
Low
|
|
Unit
|
||||||||||||
1st Quarter
|
|
$
|
92.09
|
|
|
$
|
73.94
|
|
|
$
|
0.58
|
|
|
$
|
70.89
|
|
|
$
|
57.62
|
|
|
$
|
0.46
|
|
2nd Quarter
|
|
89.47
|
|
|
76.69
|
|
|
0.61
|
|
|
102.51
|
|
|
69.69
|
|
|
0.49
|
|
||||||
3rd Quarter
|
|
83.68
|
|
|
59.21
|
|
|
0.64
|
|
|
98.68
|
|
|
81.58
|
|
|
0.52
|
|
||||||
4th Quarter
|
|
$
|
79.10
|
|
|
$
|
56.52
|
|
|
$
|
0.675
|
|
|
$
|
92.56
|
|
|
$
|
72.56
|
|
|
$
|
0.55
|
|
|
|
As of and for the Years Ended December 31,
|
||||||||||||||||||
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
Statements of Consolidated Operations
|
|
|
|
(Thousands, except per share amounts)
|
|
|
||||||||||||||
Operating revenues
|
|
$
|
614,134
|
|
|
$
|
476,547
|
|
|
$
|
354,001
|
|
|
$
|
236,293
|
|
|
$
|
169,759
|
|
Operating income
|
|
437,808
|
|
|
326,712
|
|
|
244,794
|
|
|
150,600
|
|
|
101,058
|
|
|||||
Net income
|
|
$
|
393,450
|
|
|
$
|
266,500
|
|
|
$
|
189,791
|
|
|
$
|
110,216
|
|
|
$
|
61,389
|
|
Net income per limited partner unit
(a)
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
$
|
4.71
|
|
|
$
|
3.53
|
|
|
$
|
2.47
|
|
|
$
|
1.03
|
|
|
N/A
|
|
|
Diluted
|
|
4.70
|
|
|
3.52
|
|
|
2.46
|
|
|
1.03
|
|
|
N/A
|
|
|||||
Cash distributions paid per limited partner unit
|
|
$
|
2.505
|
|
|
$
|
2.02
|
|
|
$
|
1.55
|
|
|
$
|
0.35
|
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated Balance Sheets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Total assets
|
|
$
|
2,633,835
|
|
|
$
|
1,822,819
|
|
|
$
|
1,351,940
|
|
|
$
|
999,914
|
|
|
$
|
713,708
|
|
Long-term debt
|
|
493,401
|
|
|
492,633
|
|
|
—
|
|
|
—
|
|
|
135,235
|
|
|||||
Long-term lease obligation
|
|
$
|
175,660
|
|
|
$
|
143,828
|
|
|
$
|
133,733
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Years Ended December 31,
|
||||||||||||||||
|
|
2015
|
|
2014
|
|
%
change
2015 –
2014
|
|
2013
|
|
%
change
2014 -
2013
|
||||||||
FINANCIAL DATA
|
|
(Thousands, other than per day amounts)
|
||||||||||||||||
Firm reservation revenues
|
|
$
|
247,231
|
|
|
$
|
202,112
|
|
|
22.3
|
|
|
$
|
127,022
|
|
|
59.1
|
|
Volumetric based fee revenues:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Usage fees under firm contracts
(a)
|
|
42,646
|
|
|
41,828
|
|
|
2.0
|
|
|
42,312
|
|
|
(1.1
|
)
|
|||
Usage fees under interruptible contracts
|
|
7,018
|
|
|
10,880
|
|
|
(35.5
|
)
|
|
4,547
|
|
|
139.3
|
|
|||
Total volumetric based fee revenues
|
|
49,664
|
|
|
52,708
|
|
|
(5.8
|
)
|
|
46,859
|
|
|
12.5
|
|
|||
Total operating revenues
|
|
296,895
|
|
|
254,820
|
|
|
16.5
|
|
|
173,881
|
|
|
46.5
|
|
|||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Operating and maintenance
|
|
33,024
|
|
|
24,780
|
|
|
33.3
|
|
|
15,041
|
|
|
64.7
|
|
|||
Selling, general and administrative
|
|
31,215
|
|
|
19,954
|
|
|
56.4
|
|
|
15,567
|
|
|
28.2
|
|
|||
Depreciation and amortization
|
|
29,497
|
|
|
26,792
|
|
|
10.1
|
|
|
18,323
|
|
|
46.2
|
|
|||
Total operating expenses
|
|
93,736
|
|
|
71,526
|
|
|
31.1
|
|
|
48,931
|
|
|
46.2
|
|
|||
Operating income
|
|
$
|
203,159
|
|
|
$
|
183,294
|
|
|
10.8
|
|
|
$
|
124,950
|
|
|
46.7
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
OPERATIONAL DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Transmission pipeline throughput (BBtu per day)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Firm capacity reservation
|
|
1,841
|
|
|
1,405
|
|
|
31.0
|
|
|
855
|
|
|
64.3
|
|
|||
Volumetric based services
(b)
|
|
281
|
|
|
389
|
|
|
(27.8
|
)
|
|
291
|
|
|
33.7
|
|
|||
Total transmission pipeline throughput
|
|
2,122
|
|
|
1,794
|
|
|
18.3
|
|
|
1,146
|
|
|
56.5
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Average contracted firm transmission reservation commitments (BBtu per day)
|
|
2,624
|
|
|
2,056
|
|
|
27.6
|
|
|
1,305
|
|
|
57.5
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Capital expenditures
|
|
$
|
168,873
|
|
|
$
|
127,134
|
|
|
32.8
|
|
|
$
|
77,989
|
|
|
63.0
|
|
|
|
Years Ended December 31,
|
||||||||||||||||
|
|
2015
|
|
2014
|
|
%
change
2015 –
2014
|
|
2013
|
|
%
change
2014 -
2013
|
||||||||
FINANCIAL DATA
|
|
(Thousands, other than per day amounts)
|
||||||||||||||||
Firm reservation revenues
|
|
$
|
256,217
|
|
|
$
|
37,449
|
|
|
584.2
|
|
|
$
|
—
|
|
|
N/A
|
|
Volumetric based fee revenues:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Usage fees under firm contracts(a)
|
|
33,021
|
|
|
44,594
|
|
|
(26.0
|
)
|
|
—
|
|
|
N/A
|
|
|||
Usage fees under interruptible contracts
|
|
28,001
|
|
|
139,684
|
|
|
(80.0
|
)
|
|
180,120
|
|
|
(22.4
|
)
|
|||
Total volumetric based fee revenues
|
|
61,022
|
|
|
184,278
|
|
|
(66.9
|
)
|
|
180,120
|
|
|
2.3
|
|
|||
Total operating revenues
|
|
317,239
|
|
|
221,727
|
|
|
43.1
|
|
|
180,120
|
|
|
23.1
|
|
|||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Operating and maintenance
|
|
35,237
|
|
|
30,496
|
|
|
15.5
|
|
|
27,686
|
|
|
10.1
|
|
|||
Selling, general and administrative
|
|
25,210
|
|
|
28,551
|
|
|
(11.7
|
)
|
|
20,007
|
|
|
42.7
|
|
|||
Depreciation and amortization
|
|
22,143
|
|
|
19,262
|
|
|
15.0
|
|
|
12,583
|
|
|
53.1
|
|
|||
Total operating expenses
|
|
82,590
|
|
|
78,309
|
|
|
5.5
|
|
|
60,276
|
|
|
29.9
|
|
|||
Operating income
|
|
$
|
234,649
|
|
|
$
|
143,418
|
|
|
63.6
|
|
|
$
|
119,844
|
|
|
19.7
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
OPERATIONAL DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Gathering volumes (BBtu per day)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Firm capacity reservation
|
|
1,115
|
|
|
180
|
|
|
519.4
|
|
|
—
|
|
|
N/A
|
|
|||
Volumetric based services
|
|
391
|
|
|
973
|
|
|
(59.8
|
)
|
|
864
|
|
|
12.6
|
|
|||
Total gathered volumes
|
|
1,506
|
|
|
1,153
|
|
|
30.6
|
|
|
864
|
|
|
33.4
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Capital expenditures
|
|
$
|
207,342
|
|
|
$
|
226,168
|
|
|
(8.3
|
)
|
|
$
|
197,543
|
|
|
14.5
|
|
•
|
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’s 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.
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
Net income
|
$
|
393,450
|
|
|
$
|
266,500
|
|
|
$
|
189,791
|
|
Add:
|
|
|
|
|
|
||||||
Interest expense
|
45,661
|
|
|
30,856
|
|
|
1,672
|
|
|||
Depreciation and amortization expense
|
51,640
|
|
|
46,054
|
|
|
30,906
|
|
|||
Income tax expense
|
6,703
|
|
|
31,705
|
|
|
54,573
|
|
|||
Non-cash long-term compensation expense
|
1,467
|
|
|
3,368
|
|
|
981
|
|
|||
Less:
|
|
|
|
|
|
||||||
Non-cash adjustments
|
—
|
|
|
(1,520
|
)
|
|
(680
|
)
|
|||
Equity income
|
(2,367
|
)
|
|
—
|
|
|
—
|
|
|||
Other income
|
(5,639
|
)
|
|
(2,349
|
)
|
|
(1,242
|
)
|
|||
Capital lease payments for AVC
(a)
|
(22,059
|
)
|
|
(21,802
|
)
|
|
(1,030
|
)
|
|||
Pre-merger capital lease payments for Sunrise
(a)
|
—
|
|
|
—
|
|
|
(15,201
|
)
|
|||
Adjusted EBITDA attributable to Jupiter prior to acquisition
(b)
|
—
|
|
|
(34,733
|
)
|
|
(103,593
|
)
|
|||
Adjusted EBITDA attributable to NWV Gathering prior to acquisition
(c)
|
(19,841
|
)
|
|
(62,431
|
)
|
|
(36,667
|
)
|
|||
Adjusted EBITDA
|
$
|
449,015
|
|
|
$
|
255,648
|
|
|
$
|
119,510
|
|
Less:
|
|
|
|
|
|
|
|
||||
Interest expense, excluding capital lease interest
|
(22,436
|
)
|
|
(10,968
|
)
|
|
(939
|
)
|
|||
Ongoing maintenance capital expenditures, net of reimbursements
(d)
|
(20,099
|
)
|
|
(15,196
|
)
|
|
(17,200
|
)
|
|||
Distributable cash flow
|
$
|
406,480
|
|
|
$
|
229,484
|
|
|
$
|
101,371
|
|
|
|
|
|
|
|
||||||
Net cash provided by operating activities
|
$
|
463,476
|
|
|
$
|
300,546
|
|
|
$
|
260,300
|
|
Adjustments:
|
|
|
|
|
|
||||||
Interest expense
|
45,661
|
|
|
30,856
|
|
|
1,672
|
|
|||
Current tax expense
|
3,705
|
|
|
12,177
|
|
|
16,910
|
|
|||
Capital lease payments for AVC
(a)
|
(22,059
|
)
|
|
(21,802
|
)
|
|
(1,030
|
)
|
|||
Pre-merger capital lease payments for Sunrise
(a)
|
—
|
|
|
—
|
|
|
(15,201
|
)
|
|||
Adjusted EBITDA attributable to Jupiter prior to acquisition
(b)
|
—
|
|
|
(34,733
|
)
|
|
(103,593
|
)
|
|||
Adjusted EBITDA attributable to NWV Gathering prior to acquisition
(c)
|
(19,841
|
)
|
|
(62,431
|
)
|
|
(36,667
|
)
|
|||
Other, including changes in working capital
|
(21,927
|
)
|
|
31,035
|
|
|
(2,881
|
)
|
|||
Adjusted EBITDA
|
$
|
449,015
|
|
|
$
|
255,648
|
|
|
$
|
119,510
|
|
•
|
Ohio Valley Connector
. The OVC
is a 37-mile pipeline that will extend EQM's transmission and storage system from northern West Virginia to Clarington, Ohio, at which point it will interconnect with the Rockies Express Pipeline and may interconnect with other pipelines and liquidity points. The OVC will provide approximately 850 BBtu per day of transmission capacity with an aggregate compression of approximately 38,000 horsepower and is estimated to cost $350 million to $380 million, of which $210 million to $220 million is expected to be spent in 2016. EQT has entered into a 20-year precedent agreement with EQM for a total of 650 BBtu per day of firm transmission capacity on the OVC. EQM received its FERC certificate to construct and operate the OVC on December 30, 2015 and construction began in January 2016. EQM expects the OVC to be in-service by year-end 2016.
|
•
|
Range Resources Header Pipeline Project
.
In July 2015, EQM announced its agreement with a subsidiary of Range Resources to construct a natural gas header pipeline in southwestern Pennsylvania to support Marcellus and Utica development. The pipeline is expected to cost approximately $250 million and is contracted to provide 550 MMcf per day of firm capacity backed by a ten-year firm capacity reservation commitment. EQM plans to complete the project in two phases, with phase one expected to be in-service during the second half of 2016 and phase two during the first half of 2017. EQM expects to invest approximately $195 million to $205 million on the project in 2016.
|
•
|
NWV Gathering and Jupiter Development Areas
.
EQM expects to invest a total of approximately $370 million, of which approximately $95 million to $105 million is expected to be spent during 2016, related to expansion in the NWV Gathering development area. These expenditures are part of a fully subscribed expansion project expected
|
•
|
Transmission Expansion Projects
.
EQM is evaluating several multi-year transmission capacity expansion projects to support production growth in the Marcellus and Utica Shales that could total an additional 1.5 Bcf per day of capacity by year-end 2018. The projects may include additional compression, pipeline looping and new header pipelines. EQM expects to spend approximately $25 million on these expansion projects during 2016.
|
•
|
Mountain Valley Pipeline
. The MVP Joint Venture is a joint venture with affiliates of each of NextEra Energy, Inc., ConEd, WGL Holdings, Inc.,Vega Energy Partners, Ltd. and RGC Resources, Inc. As of February 11, 2016, EQM owned a 45.5% interest in the MVP Joint Venture and had assumed the role of operator of the MVP to be constructed by the joint venture. The estimated 300-mile MVP is currently targeted at 42 inches in diameter and a capacity of 2.0 Bcf per day, and will extend from EQM's existing transmission and storage system in Wetzel County, West Virginia to Pittsylvania County, Virginia. As currently designed, the MVP is estimated to cost a total of $3.0 billion to $3.5 billion, excluding AFUDC, with EQM funding its proportionate share through capital contributions made to the joint venture. In 2016, EQM expects to provide capital contributions of approximately $150 million to the MVP Joint Venture, primarily in support of material orders, environmental and land assessments and engineering design work. Expenditures are expected to increase substantially as construction commences, with the bulk of the expenditures expected to be made in 2017 and 2018. On January 21, 2016, affiliates of ConEd acquired a 12.5% interest in the MVP Joint Venture and entered into 20-year firm capacity commitments for approximately 0.25 Bcf per day on both the MVP and EQM’s transmission system. ConEd has the right to terminate its purchase of the interest in the MVP Joint Venture and be reimbursed for the purchase price and all capital contributions it makes to the MVP Joint Venture for a period ending no later than December 31, 2016. The MVP Joint Venture has secured a total of 2.0 Bcf per day of 20-year firm capacity commitments, including a 1.29 Bcf per day firm capacity commitment by EQT, and is currently in negotiation with additional shippers who have expressed interest in the MVP project. The MVP Joint Venture submitted the MVP certificate application to the FERC in October 2015 and anticipates receiving the certificate in the fourth quarter of 2016. Subject to FERC approval, construction is scheduled to begin shortly thereafter and the pipeline is expected to be in-service during the fourth quarter of 2018.
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
|||||||||||
Expansion capital expenditures
(a)
|
|
$
|
344,908
|
|
|
$
|
329,206
|
|
|
$
|
241,254
|
|
Maintenance capital expenditures:
|
|
|
|
|
|
|
||||||
Ongoing maintenance
|
|
27,928
|
|
|
16,493
|
|
|
22,185
|
|
|||
Funded regulatory compliance
|
|
3,379
|
|
|
7,603
|
|
|
12,093
|
|
|||
Total maintenance capital expenditures
|
|
31,307
|
|
|
24,096
|
|
|
34,278
|
|
|||
Total capital expenditures
(b)
|
|
$
|
376,215
|
|
|
$
|
353,302
|
|
|
$
|
275,532
|
|
Rating Service
|
|
Senior Notes
|
|
Outlook
|
Moody’s Investors Service (Moody's)
|
|
Ba1
|
|
Under Review
|
Standard & Poor’s Ratings Services (S&P)
|
|
BBB-
|
|
Stable
|
Fitch Ratings (Fitch)
|
|
BBB-
|
|
Stable
|
|
|
Total
|
|
2016
|
|
2017-2018
|
|
2019-2020
|
|
2021+
|
||||||||||
|
|
(Thousands)
|
||||||||||||||||||
Long-term debt
|
|
$
|
500,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
500,000
|
|
Capital lease obligation
(a)
|
|
383,718
|
|
|
20,220
|
|
|
40,691
|
|
|
35,831
|
|
|
286,976
|
|
|||||
Credit facility borrowings
(b)
|
|
299,000
|
|
|
299,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Interest payments on long-term debt
(c)
|
|
171,667
|
|
|
20,000
|
|
|
40,000
|
|
|
40,000
|
|
|
71,667
|
|
|||||
Purchase obligations
|
|
18,864
|
|
|
18,864
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total contractual obligations
|
|
$
|
1,373,249
|
|
|
$
|
358,084
|
|
|
$
|
80,691
|
|
|
$
|
75,831
|
|
|
$
|
858,643
|
|
|
Page
Reference
|
Reports of Independent Registered Public Accounting Firm
|
|
Statements of Consolidated Operations for each of the three years in the period ended December 31, 2015
|
|
Statements of Consolidated Cash Flows for each of the three years in the period ended December 31, 2015
|
|
Consolidated Balance Sheets as of December 31, 2015 and 2014
|
|
Statements of Consolidated Partners’ Capital for each of the three years in the period ended December 31, 2015
|
|
Notes to Consolidated Financial Statements
|
/s/ Ernst & Young, LLP
|
|
Pittsburgh, Pennsylvania
|
|
February 11, 2016
|
|
/s/ Ernst & Young, LLP
|
|
Pittsburgh, Pennsylvania
|
|
February 11, 2016
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands, except per unit amounts)
|
||||||||||
Operating revenues
(b)
|
$
|
614,134
|
|
|
$
|
476,547
|
|
|
$
|
354,001
|
|
Operating expenses:
|
|
|
|
|
|
|
|
||||
Operating and maintenance
(c)
|
68,261
|
|
|
55,276
|
|
|
42,727
|
|
|||
Selling, general and administrative
(c)
|
56,425
|
|
|
48,505
|
|
|
35,574
|
|
|||
Depreciation and amortization
|
51,640
|
|
|
46,054
|
|
|
30,906
|
|
|||
Total operating expenses
|
176,326
|
|
|
149,835
|
|
|
109,207
|
|
|||
Operating income
|
437,808
|
|
|
326,712
|
|
|
244,794
|
|
|||
Equity income
(d)
|
2,367
|
|
|
—
|
|
|
—
|
|
|||
Other income
|
5,639
|
|
|
2,349
|
|
|
1,242
|
|
|||
Interest expense
(e)
|
45,661
|
|
|
30,856
|
|
|
1,672
|
|
|||
Income before income taxes
|
400,153
|
|
|
298,205
|
|
|
244,364
|
|
|||
Income tax expense
|
6,703
|
|
|
31,705
|
|
|
54,573
|
|
|||
Net income
|
$
|
393,450
|
|
|
$
|
266,500
|
|
|
$
|
189,791
|
|
|
|
|
|
|
|
||||||
Calculation of limited partner interest in net income:
|
|
|
|
|
|
|
|
||||
Net income
|
$
|
393,450
|
|
|
$
|
266,500
|
|
|
$
|
189,791
|
|
Less pre-acquisition income allocated to parent
|
(11,106
|
)
|
|
(53,878
|
)
|
|
(86,213
|
)
|
|||
Less general partner interest in net income
|
(54,447
|
)
|
|
(15,705
|
)
|
|
(2,927
|
)
|
|||
Limited partner interest in net income
|
$
|
327,897
|
|
|
$
|
196,917
|
|
|
$
|
100,651
|
|
|
|
|
|
|
|
||||||
Net income per limited partner unit – basic
|
$
|
4.71
|
|
|
$
|
3.53
|
|
|
$
|
2.47
|
|
Net income per limited partner unit – diluted
|
$
|
4.70
|
|
|
$
|
3.52
|
|
|
$
|
2.46
|
|
|
|
|
|
|
|
||||||
Weighted average limited partner units outstanding – basic
|
69,612
|
|
|
55,745
|
|
|
40,739
|
|
|||
Weighted average limited partner units outstanding – diluted
|
69,773
|
|
|
55,883
|
|
|
40,847
|
|
(b)
|
Operating revenues included affiliate revenues from EQT Corporation and subsidiaries (collectively, EQT) of
$447.6 million
,
$328.5 million
and
$310.2 million
for the years ended
December 31, 2015
,
2014
and
2013
, respectively. In December 2013, EQT completed the sale of Equitable Gas Company, LLC (Equitable Gas Company) to PNG Companies LLC. As a result, revenues from Equitable Gas Company were reported as third party revenues starting in 2014. For the year ended
December 31, 2013
, Equitable Gas Company revenues reported as affiliate revenues were
$37.6 million
. See Note 5.
|
(c)
|
Operating and maintenance expense included charges from EQT of
$33.1 million
,
$28.7 million
and
$21.9 million
for the years ended
December 31, 2015
,
2014
and
2013
, respectively. Selling, general and administrative expense included charges from EQT of
$48.5 million
,
$40.7 million
and
$31.3 million
for the years ended
December 31, 2015
,
2014
and
2013
, respectively. See Note 5.
|
(d)
|
Equity income relates to EQM's interest in Mountain Valley Pipeline, LLC, which is a related party.
|
(e)
|
Interest expense for the years ended
December 31, 2015
,
2014
and
2013
included
$23.2 million
,
$19.9 million
and
$0.8 million
, respectively, related to interest on a capital lease with an affiliate. See Note 12.
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
||||
Net income
|
$
|
393,450
|
|
|
$
|
266,500
|
|
|
$
|
189,791
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
||||
Depreciation and amortization
|
51,640
|
|
|
46,054
|
|
|
30,906
|
|
|||
Deferred income taxes
|
2,998
|
|
|
19,528
|
|
|
37,663
|
|
|||
Equity income
|
(2,367
|
)
|
|
—
|
|
|
—
|
|
|||
Other income
|
(5,639
|
)
|
|
(2,349
|
)
|
|
(1,242
|
)
|
|||
Non-cash long term compensation expense
|
1,467
|
|
|
3,368
|
|
|
981
|
|
|||
Non-cash adjustments
|
—
|
|
|
(1,520
|
)
|
|
(680
|
)
|
|||
Changes in other assets and liabilities:
|
|
|
|
|
|
|
|
||||
Accounts receivable
|
(639
|
)
|
|
(8,029
|
)
|
|
(4,720
|
)
|
|||
Accounts payable
|
8,643
|
|
|
4,713
|
|
|
(4,534
|
)
|
|||
Due to/from EQT affiliates
|
2,913
|
|
|
(38,892
|
)
|
|
11,639
|
|
|||
Other assets and other liabilities
|
11,010
|
|
|
11,173
|
|
|
496
|
|
|||
Net cash provided by operating activities
|
463,476
|
|
|
300,546
|
|
|
260,300
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||
Capital expenditures
|
(408,955
|
)
|
|
(318,105
|
)
|
|
(283,011
|
)
|
|||
Acquisitions - net assets from EQT
|
(386,791
|
)
|
|
(168,198
|
)
|
|
—
|
|
|||
MVP Interest Acquisition and capital contributions, net of sales of interests in the MVP Joint Venture
|
(74,658
|
)
|
|
—
|
|
|
—
|
|
|||
Purchase of preferred interest in EQT Energy Supply, LLC
|
(124,317
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash used in investing activities
|
(994,721
|
)
|
|
(486,303
|
)
|
|
(283,011
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||
Proceeds from the issuance of common units, net of offering costs
|
1,183,921
|
|
|
902,467
|
|
|
529,442
|
|
|||
Acquisitions - purchase price in excess of net assets from EQT
|
(486,392
|
)
|
|
(952,802
|
)
|
|
—
|
|
|||
Sunrise Merger payment
|
—
|
|
|
(110,000
|
)
|
|
(507,500
|
)
|
|||
Proceeds from credit facility borrowings
|
617,000
|
|
|
450,000
|
|
|
—
|
|
|||
Payments on credit facility borrowings
|
(318,000
|
)
|
|
(450,000
|
)
|
|
—
|
|
|||
Proceeds from the issuance of long-term debt
|
—
|
|
|
500,000
|
|
|
—
|
|
|||
Net (distributions to) contributions from EQT
|
(23,866
|
)
|
|
85,073
|
|
|
61,026
|
|
|||
Capital contributions
|
1,781
|
|
|
382
|
|
|
5,631
|
|
|||
Distributions paid to unitholders
|
(212,262
|
)
|
|
(119,628
|
)
|
|
(66,176
|
)
|
|||
Pre-merger distributions paid to EQT
|
—
|
|
|
—
|
|
|
(31,390
|
)
|
|||
Discount, debt issuance costs and credit facility fees
|
—
|
|
|
(9,707
|
)
|
|
—
|
|
|||
Capital lease principal payments
|
(6,298
|
)
|
|
(2,216
|
)
|
|
—
|
|
|||
Net cash provided by (used in) financing activities
|
755,884
|
|
|
293,569
|
|
|
(8,967
|
)
|
|||
|
|
|
|
|
|
||||||
Net change in cash and cash equivalents
|
224,639
|
|
|
107,812
|
|
|
(31,678
|
)
|
|||
Cash and cash equivalents at beginning of year
|
126,175
|
|
|
18,363
|
|
|
50,041
|
|
|||
Cash and cash equivalents at end of year
|
$
|
350,814
|
|
|
$
|
126,175
|
|
|
$
|
18,363
|
|
|
|
|
|
|
|
||||||
Cash paid during the year for:
|
|
|
|
|
|
|
|
||||
Interest, net of amount capitalized
|
$
|
45,477
|
|
|
$
|
20,693
|
|
|
$
|
939
|
|
Non-cash activity during the year:
|
|
|
|
|
|
|
|
||||
Elimination of net current and deferred tax liabilities
|
$
|
84,446
|
|
|
$
|
51,813
|
|
|
$
|
43,083
|
|
Limited partner and general partner units issued for acquisitions
|
52,500
|
|
|
59,000
|
|
|
32,500
|
|
|||
Capital lease asset/obligation
|
35,708
|
|
|
9,161
|
|
|
134,395
|
|
|||
Contingent consideration
|
—
|
|
|
—
|
|
|
110,000
|
|
|||
Settlement of current income taxes payable/(receivable) with EQT
|
$
|
—
|
|
|
$
|
(18,322
|
)
|
|
$
|
2,841
|
|
|
2015
|
|
2014
|
||||
|
(Thousands, except number of units)
|
||||||
ASSETS
|
|
|
|
|
|||
Current assets:
|
|
|
|
|
|||
Cash and cash equivalents
|
$
|
350,814
|
|
|
$
|
126,175
|
|
Accounts receivable (net of allowance for doubtful accounts of $238 and $260 as of December 31, 2015 and 2014, respectively)
|
17,131
|
|
|
16,492
|
|
||
Accounts receivable – affiliate
|
77,925
|
|
|
55,068
|
|
||
Other current assets
|
1,680
|
|
|
1,710
|
|
||
Total current assets
|
447,550
|
|
|
199,445
|
|
||
Property, plant and equipment
|
2,228,967
|
|
|
1,821,803
|
|
||
Less: accumulated depreciation
|
(258,974
|
)
|
|
(216,486
|
)
|
||
Net property, plant and equipment
|
1,969,993
|
|
|
1,605,317
|
|
||
Investments in unconsolidated entities
|
201,342
|
|
|
—
|
|
||
Other assets
|
14,950
|
|
|
18,057
|
|
||
Total assets
|
$
|
2,633,835
|
|
|
$
|
1,822,819
|
|
|
|
|
|
||||
LIABILITIES AND PARTNERS’ CAPITAL
|
|
|
|
|
|||
Current liabilities:
|
|
|
|
|
|||
Accounts payable
|
$
|
35,868
|
|
|
$
|
43,785
|
|
Due to related party
|
33,413
|
|
|
33,342
|
|
||
Credit facility borrowings
|
299,000
|
|
|
—
|
|
||
Accrued interest
|
8,753
|
|
|
8,338
|
|
||
Accrued liabilities
|
12,194
|
|
|
9,055
|
|
||
Total current liabilities
|
389,228
|
|
|
94,520
|
|
||
Deferred income taxes
|
—
|
|
|
78,583
|
|
||
Long-term debt
|
493,401
|
|
|
492,633
|
|
||
Lease obligation
|
175,660
|
|
|
143,828
|
|
||
Other long-term liabilities
|
7,834
|
|
|
7,111
|
|
||
Total liabilities
|
1,066,123
|
|
|
816,675
|
|
||
|
|
|
|
||||
Partners’ capital:
|
|
|
|
|
|||
Predecessor equity
|
—
|
|
|
315,105
|
|
||
Common units (77,520,181 and 43,347,452 units issued and outstanding at December 31, 2015 and 2014, respectively)
|
1,598,675
|
|
|
1,647,910
|
|
||
Subordinated units (17,339,718 units issued and outstanding at December 31, 2014)
|
—
|
|
|
(929,374
|
)
|
||
General partner interest (1,443,015 and 1,238,514 units issued and outstanding at December 31, 2015 and 2014, respectively)
|
(30,963
|
)
|
|
(27,497
|
)
|
||
Total partners’ capital
|
1,567,712
|
|
|
1,006,144
|
|
||
Total liabilities and partners’ capital
|
$
|
2,633,835
|
|
|
$
|
1,822,819
|
|
|
|
|
Partners’ Capital
|
|
|
||||||||||||||
|
Predecessor
|
|
Limited Partners
|
|
General
|
|
|
||||||||||||
|
Equity
|
|
Common
|
|
Subordinated
|
|
Partner
|
|
Total
|
||||||||||
|
(Thousands)
|
||||||||||||||||||
Balance at January 1, 2013
|
$
|
364,743
|
|
|
$
|
313,304
|
|
|
$
|
153,664
|
|
|
$
|
8,108
|
|
|
$
|
839,819
|
|
Net income
|
86,213
|
|
|
58,673
|
|
|
41,978
|
|
|
2,927
|
|
|
189,791
|
|
|||||
Net contributions from EQT
|
63,867
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
63,867
|
|
|||||
Capital contributions
|
—
|
|
|
1,705
|
|
|
1,363
|
|
|
64
|
|
|
3,132
|
|
|||||
Equity-based compensation plans
|
—
|
|
|
981
|
|
|
—
|
|
|
—
|
|
|
981
|
|
|||||
Distributions to unitholders
|
—
|
|
|
(37,774
|
)
|
|
(26,877
|
)
|
|
(1,525
|
)
|
|
(66,176
|
)
|
|||||
Pre-merger distributions to EQT
|
(31,390
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(31,390
|
)
|
|||||
Proceeds from issuance of common units, net of offering costs
|
—
|
|
|
529,442
|
|
|
—
|
|
|
—
|
|
|
529,442
|
|
|||||
Elimination of net current and deferred tax liabilities
|
43,083
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
43,083
|
|
|||||
Sunrise net assets from EQT
|
(215,655
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(215,655
|
)
|
|||||
Issuance of units
|
—
|
|
|
20,845
|
|
|
—
|
|
|
11,655
|
|
|
32,500
|
|
|||||
Purchase price in excess of net assets from EQT
|
—
|
|
|
(68,745
|
)
|
|
(346,124
|
)
|
|
(19,476
|
)
|
|
(434,345
|
)
|
|||||
Balance at December 31, 2013
|
$
|
310,861
|
|
|
$
|
818,431
|
|
|
$
|
(175,996
|
)
|
|
$
|
1,753
|
|
|
$
|
955,049
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
53,878
|
|
|
136,992
|
|
|
59,925
|
|
|
15,705
|
|
|
266,500
|
|
|||||
Capital contributions
|
—
|
|
|
338
|
|
|
152
|
|
|
10
|
|
|
500
|
|
|||||
Equity-based compensation plans
|
—
|
|
|
3,692
|
|
|
—
|
|
|
—
|
|
|
3,692
|
|
|||||
Net contributions from EQT
|
66,751
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66,751
|
|
|||||
Distributions to unitholders
|
—
|
|
|
(75,328
|
)
|
|
(35,026
|
)
|
|
(9,274
|
)
|
|
(119,628
|
)
|
|||||
Proceeds from issuance of common units, net of offering costs
|
—
|
|
|
902,467
|
|
|
—
|
|
|
—
|
|
|
902,467
|
|
|||||
Elimination of net current and deferred tax liabilities
|
51,813
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
51,813
|
|
|||||
Jupiter net assets from EQT
|
(168,198
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(168,198
|
)
|
|||||
Issuance of units
|
—
|
|
|
39,091
|
|
|
—
|
|
|
19,909
|
|
|
59,000
|
|
|||||
Purchase price in excess of net assets from EQT
|
—
|
|
|
(177,773
|
)
|
|
(778,429
|
)
|
|
(55,600
|
)
|
|
(1,011,802
|
)
|
|||||
Balance at December 31, 2014
|
$
|
315,105
|
|
|
$
|
1,647,910
|
|
|
$
|
(929,374
|
)
|
|
$
|
(27,497
|
)
|
|
$
|
1,006,144
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
11,106
|
|
|
327,897
|
|
|
—
|
|
|
54,447
|
|
|
393,450
|
|
|||||
Capital contributions
|
—
|
|
|
7,342
|
|
|
—
|
|
|
150
|
|
|
7,492
|
|
|||||
Equity-based compensation plans
|
—
|
|
|
1,537
|
|
|
—
|
|
|
33
|
|
|
1,570
|
|
|||||
Net distributions to EQT
|
(23,866
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,866
|
)
|
|||||
Distributions to unitholders
|
—
|
|
|
(162,040
|
)
|
|
(10,057
|
)
|
|
(40,165
|
)
|
|
(212,262
|
)
|
|||||
Conversion of subordinated units to common units
(b)
|
—
|
|
|
(939,431
|
)
|
|
939,431
|
|
|
—
|
|
|
—
|
|
|||||
Proceeds from issuance of common units, net of offering costs
|
—
|
|
|
1,182,002
|
|
|
—
|
|
|
1,919
|
|
|
1,183,921
|
|
|||||
Elimination of net current and deferred tax liabilities
|
84,446
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
84,446
|
|
|||||
NWV Gathering net assets from EQT
|
(386,791
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(386,791
|
)
|
|||||
Issuance of units
|
—
|
|
|
38,910
|
|
|
—
|
|
|
13,590
|
|
|
52,500
|
|
|||||
Purchase price in excess of net assets from EQT
|
—
|
|
|
(505,452
|
)
|
|
—
|
|
|
(33,440
|
)
|
|
(538,892
|
)
|
|||||
Balance at December 31, 2015
|
$
|
—
|
|
|
$
|
1,598,675
|
|
|
$
|
—
|
|
|
$
|
(30,963
|
)
|
|
$
|
1,567,712
|
|
|
|
As of December 31,
|
||||||
|
|
2015
|
|
2014
|
||||
|
|
(Thousands)
|
||||||
Transmission and storage assets
|
|
$
|
1,247,970
|
|
|
$
|
1,045,207
|
|
Accumulated depreciation
|
|
(181,672
|
)
|
|
(159,583
|
)
|
||
Net transmission and storage assets
|
|
1,066,298
|
|
|
885,624
|
|
||
Gathering assets
|
|
980,997
|
|
|
776,596
|
|
||
Accumulated depreciation
|
|
(77,302
|
)
|
|
(56,903
|
)
|
||
Net gathering assets
|
|
903,695
|
|
|
719,693
|
|
||
Net property, plant and equipment
|
|
$
|
1,969,993
|
|
|
$
|
1,605,317
|
|
|
|
Acquisition Date
|
|
Total Consideration
|
|
Cash
|
|
Common Units Issued to EQT
|
|
GP Units Issued to EQT
|
||||||
|
|
(Thousands, except unit amounts)
|
||||||||||||||
Sunrise Merger
(a)
|
|
7/22/13
|
|
$
|
650,000
|
|
|
$
|
617,500
|
|
|
479,184
|
|
|
267,942
|
|
Jupiter Acquisition
(b)
|
|
5/7/14
|
|
1,180,000
|
|
|
1,121,000
|
|
|
516,050
|
|
|
262,828
|
|
||
NWV Gathering Acquisition
(c)
|
|
3/17/15
|
|
925,683
|
|
|
873,183
|
|
|
511,973
|
|
|
178,816
|
|
||
MVP Interest Acquisition
(d)
|
|
3/30/15
|
|
54,229
|
|
|
54,229
|
|
|
—
|
|
|
—
|
|
||
Preferred Interest Acquisition
(e)
|
|
4/15/15
|
|
$
|
124,317
|
|
|
$
|
124,317
|
|
|
—
|
|
|
—
|
|
|
|
Common Units Issued
(a)
|
|
GP Units Issued
(b)
|
|
Price Per Unit
|
|
Net Proceeds
|
|
Underwriters' Discount and Other Offering Expenses
|
||||||||
|
|
(Thousands, except unit and per unit amounts)
|
||||||||||||||||
July 2013 equity offering
(c)
|
|
12,650,000
|
|
|
—
|
|
|
$
|
43.50
|
|
|
$
|
529,442
|
|
|
$
|
20,833
|
|
May 2014 equity offering
(d)
|
|
12,362,500
|
|
|
—
|
|
|
75.75
|
|
|
902,467
|
|
|
33,992
|
|
|||
March 2015 equity offering
(e)
|
|
9,487,500
|
|
|
25,255
|
|
|
76.00
|
|
|
696,582
|
|
|
24,468
|
|
|||
$750 million At the Market (ATM) Program
(f)
|
|
1,162,475
|
|
|
—
|
|
|
74.92
|
|
|
85,483
|
|
|
1,610
|
|
|||
November 2015 equity offering
(g)
|
|
5,650,000
|
|
|
—
|
|
|
$
|
71.80
|
|
|
$
|
399,937
|
|
|
$
|
5,733
|
|
|
|
Limited Partner Units
|
|
General
|
|
|
||||||
|
|
Common
|
|
Subordinated
|
|
Partner Units
|
|
Total
|
||||
Balance at January 1, 2013
|
|
17,339,718
|
|
|
17,339,718
|
|
|
707,744
|
|
|
35,387,180
|
|
July 2013 equity offering
|
|
12,650,000
|
|
|
—
|
|
|
—
|
|
|
12,650,000
|
|
Sunrise Merger consideration
|
|
479,184
|
|
|
—
|
|
|
267,942
|
|
|
747,126
|
|
Balance at December 31, 2013
|
|
30,468,902
|
|
|
17,339,718
|
|
|
975,686
|
|
|
48,784,306
|
|
May 2014 equity offering
|
|
12,362,500
|
|
|
—
|
|
|
—
|
|
|
12,362,500
|
|
Jupiter Acquisition consideration
|
|
516,050
|
|
|
—
|
|
|
262,828
|
|
|
778,878
|
|
Balance at December 31, 2014
|
|
43,347,452
|
|
|
17,339,718
|
|
|
1,238,514
|
|
|
61,925,684
|
|
Conversion of subordinated units to common units
|
|
17,339,718
|
|
|
(17,339,718
|
)
|
|
—
|
|
|
—
|
|
2014 EQM VDA issuance
|
|
21,063
|
|
|
—
|
|
|
430
|
|
|
21,493
|
|
March 2015 equity offering
|
|
9,487,500
|
|
|
—
|
|
|
25,255
|
|
|
9,512,755
|
|
NWV Gathering Acquisition consideration
|
|
511,973
|
|
|
—
|
|
|
178,816
|
|
|
690,789
|
|
$750 million ATM Program
|
|
1,162,475
|
|
|
—
|
|
|
—
|
|
|
1,162,475
|
|
November 2015 equity offering
|
|
5,650,000
|
|
|
—
|
|
|
—
|
|
|
5,650,000
|
|
Balance at December 31, 2015
|
|
77,520,181
|
|
|
—
|
|
|
1,443,015
|
|
|
78,963,196
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
Revenues from external customers (including affiliates):
|
|
|
|
|
|
|
|
||||
Transmission and storage
|
$
|
296,895
|
|
|
$
|
254,820
|
|
|
$
|
173,881
|
|
Gathering
|
317,239
|
|
|
221,727
|
|
|
180,120
|
|
|||
Total
|
$
|
614,134
|
|
|
$
|
476,547
|
|
|
$
|
354,001
|
|
Operating income:
|
|
|
|
|
|
|
|
||||
Transmission and storage
|
$
|
203,159
|
|
|
$
|
183,294
|
|
|
$
|
124,950
|
|
Gathering
|
234,649
|
|
|
143,418
|
|
|
119,844
|
|
|||
Total operating income
|
$
|
437,808
|
|
|
$
|
326,712
|
|
|
$
|
244,794
|
|
|
|
|
|
|
|
||||||
Reconciliation of operating income to net income:
|
|
|
|
|
|
||||||
Equity income
|
2,367
|
|
|
—
|
|
|
—
|
|
|||
Other income
|
5,639
|
|
|
2,349
|
|
|
1,242
|
|
|||
Interest expense
|
45,661
|
|
|
30,856
|
|
|
1,672
|
|
|||
Income tax expense
|
6,703
|
|
|
31,705
|
|
|
54,573
|
|
|||
Net income
|
$
|
393,450
|
|
|
$
|
266,500
|
|
|
$
|
189,791
|
|
|
As of December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
Segment assets:
|
|
|
|
|
|
|
|
||||
Transmission and storage
|
$
|
1,110,027
|
|
|
$
|
928,864
|
|
|
$
|
807,287
|
|
Gathering
|
963,877
|
|
|
765,090
|
|
|
526,290
|
|
|||
Total operating segments
|
2,073,904
|
|
|
1,693,954
|
|
|
1,333,577
|
|
|||
Headquarters, including cash
|
559,931
|
|
|
128,865
|
|
|
18,363
|
|
|||
Total assets
|
$
|
2,633,835
|
|
|
$
|
1,822,819
|
|
|
$
|
1,351,940
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
Depreciation and amortization:
|
|
|
|
|
|
|
|
||||
Transmission and storage
|
$
|
29,497
|
|
|
$
|
26,792
|
|
|
$
|
18,323
|
|
Gathering
|
22,143
|
|
|
19,262
|
|
|
12,583
|
|
|||
Total
|
$
|
51,640
|
|
|
$
|
46,054
|
|
|
$
|
30,906
|
|
Expenditures for segment assets:
|
|
|
|
|
|
|
|
||||
Transmission and storage
|
$
|
168,873
|
|
|
$
|
127,134
|
|
|
$
|
77,989
|
|
Gathering
|
207,342
|
|
|
226,168
|
|
|
197,543
|
|
|||
Total
(a)
|
$
|
376,215
|
|
|
$
|
353,302
|
|
|
$
|
275,532
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
Reimbursements to EQT
|
|
|
|
|
|
|
|
||||
Operating and maintenance expense
(a)
|
$
|
31,310
|
|
|
$
|
21,999
|
|
|
$
|
14,296
|
|
Selling, general and administrative expense
(a)
|
$
|
46,149
|
|
|
$
|
25,051
|
|
|
$
|
18,322
|
|
|
|
|
|
|
|
||||||
Reimbursements from EQT
(b)
|
|
|
|
|
|
|
|
||||
Plugging and abandonment
|
$
|
26
|
|
|
$
|
500
|
|
|
$
|
566
|
|
Bare steel replacement
|
6,268
|
|
|
—
|
|
|
2,566
|
|
|||
Other capital reimbursements
|
$
|
1,198
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
Operating revenues
(a)
|
$
|
447,587
|
|
|
$
|
328,527
|
|
|
$
|
310,245
|
|
Operating and maintenance expense
(b)
|
33,091
|
|
|
28,688
|
|
|
21,931
|
|
|||
Selling, general and administrative expense
(b)
|
48,545
|
|
|
40,663
|
|
|
31,263
|
|
|||
Equity income
|
2,367
|
|
|
—
|
|
|
—
|
|
|||
Interest expense
|
23,225
|
|
|
19,888
|
|
|
843
|
|
|||
Distributions to the EQM General Partner
(c)
|
109,194
|
|
|
59,537
|
|
|
36,647
|
|
|||
Capital contributions from EQT
|
$
|
7,492
|
|
|
$
|
500
|
|
|
$
|
3,132
|
|
|
As of December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(Thousands)
|
||||||
Accounts receivable – affiliate
|
$
|
77,925
|
|
|
$
|
55,068
|
|
Due to related party
|
33,413
|
|
|
33,342
|
|
||
Investments in unconsolidated entities
|
201,342
|
|
|
—
|
|
||
Capital lease obligation, including current portion
|
$
|
181,156
|
|
|
$
|
147,588
|
|
|
|
MVP Joint Venture
|
||
|
|
(Thousands)
|
||
Balance at December 31, 2014
|
|
$
|
—
|
|
Initial investment
|
|
54,229
|
|
|
Equity income
(a)
|
|
2,367
|
|
|
Capital contributions
|
|
30,151
|
|
|
Sales of interests in the MVP Joint Venture
|
|
(9,722
|
)
|
|
Balance at December 31, 2015
|
|
$
|
77,025
|
|
|
|
Total Quarterly
Distribution per |
|
Marginal Percentage Interest in
Distributions
|
||
|
|
Unit Target Amount
|
|
Unitholders
|
|
General Partner
|
Minimum Quarterly Distribution
|
|
$0.35
|
|
98.2%
|
|
1.8%
|
First Target Distribution
|
|
Above $0.3500 up to $0.4025
|
|
98.2%
|
|
1.8%
|
Second Target Distribution
|
|
Above $0.4025 up to $0.4375
|
|
85.2%
|
|
14.8%
|
Third Target Distribution
|
|
Above $0.4375 up to $0.5250
|
|
75.2%
|
|
24.8%
|
Thereafter
|
|
Above $0.5250
|
|
50.2%
|
|
49.8%
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
(Thousands, except per unit data)
|
||||||||||
Net income
|
|
$
|
393,450
|
|
|
$
|
266,500
|
|
|
$
|
189,791
|
|
Less:
|
|
|
|
|
|
|
|
|||||
Pre-acquisition net income allocated to parent
|
|
(11,106
|
)
|
|
(53,878
|
)
|
|
(86,213
|
)
|
|||
General partner interest in net income – general partner units
|
|
(7,455
|
)
|
|
(4,252
|
)
|
|
(2,140
|
)
|
|||
General partner interest in net income – incentive distribution rights
|
|
(46,992
|
)
|
|
(11,453
|
)
|
|
(787
|
)
|
|||
Limited partner interest in net income
|
|
$
|
327,897
|
|
|
$
|
196,917
|
|
|
$
|
100,651
|
|
|
|
|
|
|
|
|
||||||
Net income allocable to common units - basic
|
|
$
|
327,897
|
|
|
$
|
136,992
|
|
|
$
|
58,673
|
|
Net income allocable to subordinated units - basic
|
|
—
|
|
|
59,925
|
|
|
41,978
|
|
|||
Limited partner interest in net income - basic
|
|
$
|
327,897
|
|
|
$
|
196,917
|
|
|
$
|
100,651
|
|
|
|
|
|
|
|
|
||||||
Net income allocable to common units - diluted
|
|
$
|
327,897
|
|
|
$
|
137,048
|
|
|
$
|
58,697
|
|
Net income allocable to subordinated units - diluted
|
|
—
|
|
|
59,869
|
|
|
41,954
|
|
|||
Limited partner interest in net income - diluted
|
|
$
|
327,897
|
|
|
$
|
196,917
|
|
|
$
|
100,651
|
|
|
|
|
|
|
|
|
||||||
Weighted average limited partner units outstanding – basic
|
|
|
|
|
|
|
|
|||||
Common units
|
|
69,612
|
|
|
38,405
|
|
|
23,399
|
|
|||
Subordinated units
|
|
—
|
|
|
17,340
|
|
|
17,340
|
|
|||
Total
|
|
69,612
|
|
|
55,745
|
|
|
40,739
|
|
|||
Weighted average limited partner units outstanding – diluted
|
|
|
|
|
|
|
|
|||||
Common units
|
|
69,773
|
|
|
38,543
|
|
|
23,507
|
|
|||
Subordinated units
|
|
—
|
|
|
17,340
|
|
|
17,340
|
|
|||
Total
|
|
69,773
|
|
|
55,883
|
|
|
40,847
|
|
|||
Net income per limited partner unit – basic
|
|
|
|
|
|
|
|
|||||
Common units
|
|
$
|
4.71
|
|
|
$
|
3.57
|
|
|
$
|
2.51
|
|
Subordinated units
|
|
—
|
|
|
3.46
|
|
|
2.42
|
|
|||
Total
|
|
$
|
4.71
|
|
|
$
|
3.53
|
|
|
$
|
2.47
|
|
Net income per limited partner unit - diluted
|
|
|
|
|
|
|
||||||
Common units
|
|
$
|
4.70
|
|
|
$
|
3.56
|
|
|
$
|
2.50
|
|
Subordinated units
|
|
—
|
|
|
3.45
|
|
|
2.42
|
|
|||
Total
|
|
$
|
4.70
|
|
|
$
|
3.52
|
|
|
$
|
2.46
|
|
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||||||||||
|
|
Principal
|
|
Carrying Value
|
|
Fair
Value (a) |
|
Principal
|
|
Carrying Value
|
|
Fair
Value (a) |
||||||||||||
|
|
(Thousands)
|
||||||||||||||||||||||
EQM Credit Facility
|
|
$
|
299,000
|
|
|
$
|
299,000
|
|
|
$
|
299,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
4.00% Senior Notes due 2024
|
|
$
|
500,000
|
|
|
$
|
493,401
|
|
|
$
|
414,125
|
|
|
$
|
500,000
|
|
|
$
|
492,633
|
|
|
$
|
495,685
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
Tax at statutory rate
|
$
|
140,054
|
|
|
$
|
104,372
|
|
|
$
|
85,528
|
|
Partnership income not subject to income taxes
|
(133,842
|
)
|
|
(74,426
|
)
|
|
(36,253
|
)
|
|||
State income taxes
|
491
|
|
|
1,758
|
|
|
5,291
|
|
|||
Regulatory assets
|
—
|
|
|
—
|
|
|
3
|
|
|||
Other
|
—
|
|
|
1
|
|
|
4
|
|
|||
Income tax expense
|
$
|
6,703
|
|
|
$
|
31,705
|
|
|
$
|
54,573
|
|
|
|
|
|
|
|
||||||
Effective tax rate
|
1.7
|
%
|
|
10.6
|
%
|
|
22.3
|
%
|
|
December 31,
|
||
|
2014
|
||
|
(Thousands)
|
||
Deferred income taxes:
|
|
|
|
Total deferred income tax assets
|
$
|
(840
|
)
|
Total deferred income tax liabilities
|
78,583
|
|
|
Total net deferred income tax liabilities
|
$
|
77,743
|
|
|
|
|
|
Total deferred income tax liabilities/(assets):
|
|
|
|
PP&E tax deductions in excess of book deductions
|
$
|
78,583
|
|
Other (reported as other current assets)
|
(840
|
)
|
|
Total net deferred income tax liabilities
|
$
|
77,743
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
Interest expense (including contingent rent of $7.5 million, $3.4 million and $0.2 million, respectively)
(a)
|
$
|
23,225
|
|
|
$
|
19,888
|
|
|
$
|
843
|
|
Depreciation expense
|
8,734
|
|
|
5,735
|
|
|
443
|
|
|||
Cash payments under the lease
|
$
|
25,366
|
|
|
$
|
16,710
|
|
|
$
|
—
|
|
|
As of December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(Thousands)
|
||||||
Gross capital lease assets
|
$
|
179,264
|
|
|
$
|
143,556
|
|
Accumulated depreciation
|
(14,912
|
)
|
|
(6,178
|
)
|
||
Net capital lease assets
|
$
|
164,352
|
|
|
$
|
137,378
|
|
|
|
|
|
||||
Capital lease obligations, current portion
(a)
|
$
|
5,496
|
|
|
$
|
3,760
|
|
Capital lease obligations, long-term portion
|
$
|
175,660
|
|
|
$
|
143,828
|
|
|
Year ending December 31,
|
||
|
(Thousands)
|
||
2016
|
$
|
20,220
|
|
2017
|
20,477
|
|
|
2018
|
20,214
|
|
|
2019
|
18,048
|
|
|
2020
|
17,783
|
|
|
Later years
|
286,976
|
|
|
Total minimum lease payments
(a)
|
383,718
|
|
|
Less: Amount representing interest
(b)
|
(202,562
|
)
|
|
Present value of net minimum lease payments
|
$
|
181,156
|
|
|
As of December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(Thousands)
|
||||||
Regulatory assets:
|
|
|
|
|
|||
Deferred taxes
(a)
|
$
|
12,608
|
|
|
$
|
13,378
|
|
Other recoverable costs
(b)
|
309
|
|
|
1,654
|
|
||
Total regulatory assets
|
$
|
12,917
|
|
|
$
|
15,032
|
|
|
|
|
|
||||
Regulatory liabilities:
|
|
|
|
||||
On-going post-retirement benefits other than pensions
(c)
|
$
|
5,596
|
|
|
$
|
4,451
|
|
Other reimbursable costs
(d)
|
866
|
|
|
2,091
|
|
||
Total regulatory liabilities
|
$
|
6,462
|
|
|
$
|
6,542
|
|
|
|
Three Months Ended
|
||||||||||||||
|
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
|
|
(Thousands, except per unit amounts)
|
||||||||||||||
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating revenues
|
|
$
|
154,811
|
|
|
$
|
144,613
|
|
|
$
|
148,789
|
|
|
$
|
165,921
|
|
Operating income
|
|
112,752
|
|
|
101,396
|
|
|
102,911
|
|
|
120,749
|
|
||||
Net income
|
|
$
|
95,306
|
|
|
$
|
91,319
|
|
|
$
|
94,116
|
|
|
$
|
112,709
|
|
Net income per limited partner unit:
(a)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
|
$
|
1.18
|
|
|
$
|
1.12
|
|
|
$
|
1.12
|
|
|
$
|
1.27
|
|
Diluted
|
|
$
|
1.18
|
|
|
$
|
1.12
|
|
|
$
|
1.12
|
|
|
$
|
1.26
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating revenues
|
|
$
|
107,908
|
|
|
$
|
109,327
|
|
|
$
|
120,922
|
|
|
$
|
138,390
|
|
Operating income
|
|
72,617
|
|
|
72,400
|
|
|
81,866
|
|
|
99,829
|
|
||||
Net income
|
|
$
|
54,998
|
|
|
$
|
58,968
|
|
|
$
|
67,701
|
|
|
$
|
84,833
|
|
Net income per limited partner unit:
(a)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
|
$
|
0.69
|
|
|
$
|
0.81
|
|
|
$
|
0.86
|
|
|
$
|
1.12
|
|
Diluted
|
|
$
|
0.69
|
|
|
$
|
0.81
|
|
|
$
|
0.85
|
|
|
$
|
1.12
|
|
Name
|
|
Age
|
|
Position with EQT Midstream Services, LLC
|
David L. Porges
|
|
58
|
|
Chairman, President and Chief Executive Officer
|
Philip P. Conti
|
|
56
|
|
Director, Senior Vice President and Chief Financial Officer
|
Randall L. Crawford
|
|
53
|
|
Director, Executive Vice President and Chief Operating Officer
|
Lewis B. Gardner
|
|
58
|
|
Director
|
Theresa Z. Bone
|
|
52
|
|
Vice President, Finance and Chief Accounting Officer
|
Julian M. Bott
|
|
53
|
|
Director
|
Michael A. Bryson
|
|
69
|
|
Director
|
Lara E. Washington
|
|
48
|
|
Director
|
•
|
David L. Porges, Chairman, President and Chief Executive Officer;
|
•
|
Philip P. Conti, Senior Vice President and Chief Financial Officer;
|
•
|
Randall L. Crawford, Executive Vice President and Chief Operating Officer; and
|
•
|
Theresa Z. Bone, Vice President, Finance and Chief Accounting Officer.
|
•
|
Base Salary
|
•
|
Annual Incentive
|
•
|
Long-Term Incentives
|
TYPE OF AWARD
|
APPROXIMATE PERCENT OF VALUE
|
RATIONALE
|
2015 EQT Stock Options
|
25%
|
Stock options encourage executives to focus broadly on behaviors that should lead to a sustained long-term increase in the price of EQT stock, which benefits all EQT shareholders.
|
2015 Incentive PSU Program
|
75%
|
The 2015 Incentive PSU Program performance units drive long-term value directly related to EQT stock performance but allow for the delivery of some value, assuming relative performance, even if EQT’s stock price declines. Performance units have stronger retention value than options but less leverage in a rising stock price environment.
|
•
|
the EQT Corporation 2012 Executive Performance Incentive Program (the 2012 Incentive PSU Program) in EQT common stock; and
|
•
|
fifty percent of the performance awards under the 2014 VDPSU in cash.
|
•
|
2015 Special Award
|
•
|
Other Benefits
|
NAME AND PRINCIPAL POSITION
|
YEAR
|
SALARY
|
BONUS
|
STOCK AWARDS
|
OPTION AWARDS
|
NON-EQUITY
INCENTIVE PLAN
COMPENSATION
|
ALL OTHER
COMPENSATION
|
TOTAL
|
|||||||
|
($) (1)
|
($) (2)
|
($) (3)
|
($) (4)
|
($) (5)
|
($) (6)
|
($)
|
||||||||
David L. Porges
President and Chief Executive Officer
|
2015
|
850,000
|
|
1,000,000
|
|
6,690,025
|
|
1,072,610
|
|
2,100,000
|
|
393,613
|
|
12,106,248
|
|
2014
|
850,000
|
|
—
|
|
4,169,644
|
|
1,059,100
|
|
2,275,000
|
|
400,156
|
|
8,753,900
|
|
|
2013
|
882,693
|
|
—
|
|
2,649,147
|
|
1,544,928
|
|
2,500,000
|
|
345,305
|
|
7,922,073
|
|
|
Philip P. Conti Senior Vice President and Chief Financial Officer
|
2015
|
426,516
|
|
500,000
|
|
2,517,402
|
|
403,970
|
|
780,000
|
|
183,881
|
|
4,811,769
|
|
2014
|
404,846
|
|
—
|
|
1,843,334
|
|
469,475
|
|
840,000
|
|
178,022
|
|
3,735,677
|
|
|
2013
|
415,385
|
|
—
|
|
900,531
|
|
525,008
|
|
950,000
|
|
157,523
|
|
2,948,447
|
|
|
Theresa Z. Bone Vice President, Finance and Chief Accounting Officer
|
2015
|
297,116
|
|
100,000
|
|
1,069,614
|
|
173,130
|
|
255,000
|
|
63,779
|
|
1,958,639
|
|
2014
|
285,000
|
|
—
|
|
1,026,173
|
|
—
|
|
275,000
|
|
59,481
|
|
1,645,654
|
|
|
|
|
|
|
|
|
|
|
||||||||
Randall L. Crawford Executive Vice President and Chief Operating Officer
|
2015
|
460,905
|
|
500,000
|
|
2,936,499
|
|
471,630
|
|
900,000
|
|
200,457
|
|
5,469,491
|
|
2014
|
448,461
|
|
—
|
|
2,150,834
|
|
547,350
|
|
962,500
|
|
204,558
|
|
4,313,703
|
|
|
2013
|
459,000
|
|
—
|
|
1,263,199
|
|
737,352
|
|
1,100,000
|
|
171,235
|
|
3,730,786
|
|
|
|
INSURANCE
|
|
401(K)
CONTRIBUTIONS
|
|
2006
PAYROLL
DEDUCTION AND
CONTRIBUTION
PROGRAM
|
|
PERQUISITES
(SEE BELOW)
|
|
TOTAL
|
|||||
NAME
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|||||
David L. Porges
|
|
2,448
|
|
|
23,850
|
|
|
302,900
|
|
|
64,415
|
|
|
393,613
|
|
Philip P. Conti
|
|
1,244
|
|
|
23,850
|
|
|
106,936
|
|
|
51,851
|
|
|
183,881
|
|
Theresa Z. Bone
|
|
864
|
|
|
23,850
|
|
|
—
|
|
|
39,065
|
|
|
63,779
|
|
Randall L. Crawford
|
|
1,336
|
|
|
23,850
|
|
|
123,506
|
|
|
51,765
|
|
|
200,457
|
|
|
|
CAR
ALLOWANCE
|
|
COUNTRY AND
DINING CLUB
ANNUAL DUES
|
|
FINANCIAL
PLANNING
|
|
PARKING
|
|
PHYSICAL
|
|
OTHER
|
|
TOTAL
PERQUISITES
|
|||||||
NAME
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|||||||
David L. Porges
|
|
9,180
|
|
|
15,922
|
|
|
13,500
|
|
|
2,280
|
|
|
15,200
|
|
|
8,333
|
|
|
64,415
|
|
Philip P. Conti
|
|
9,060
|
|
|
10,311
|
|
|
15,000
|
|
|
2,280
|
|
|
15,200
|
|
|
—
|
|
|
51,851
|
|
Theresa Z. Bone
|
|
9,060
|
|
|
10,125
|
|
|
10,000
|
|
|
2,280
|
|
|
7,600
|
|
|
—
|
|
|
39,065
|
|
Randall L. Crawford
|
|
9,060
|
|
|
13,142
|
|
|
11,350
|
|
|
2,280
|
|
|
7,600
|
|
|
8,333
|
|
|
51,765
|
|
|
|
|
|
ESTIMATED FUTURE PAYOUTS UNDER NON-EQUITY INCENTIVE PLAN AWARDS
|
ESTIMATED FUTURE PAYOUTS UNDER EQUITY INCENTIVE PLAN AWARDS
|
ALL OTHER OPTION AWARDS; NUMBER OF SECURITIES UNDERLYING OPTIONS
|
EXERCISE OR BASE PRICE OF OPTION AWARDS
|
GRANT DATE FAIR VALUE OF STOCK AND OPTION AWARDS
|
|||||||||||||||
NAME
|
TYPE OF AWARD
|
GRANT DATE
|
APPROVAL DATE
|
THRESHOLD
|
TARGET
|
MAXIMUM
|
THRESHOLD
|
TARGET
|
MAXIMUM
|
||||||||||||||
|
(1)
|
|
|
($)
|
($) (2)
|
($) (2)
|
(#)
|
(#) (3)
|
(#) (3)
|
(#)
|
($/SH)
|
($)
|
|||||||||||
David L. Porges
|
PSU
|
1/1/2015
|
|
12/2/2014
|
|
—
|
|
—
|
|
—
|
|
—
|
|
47,410
|
|
142,230
|
|
—
|
|
—
|
|
6,690,025
|
|
ESTIP
|
—
|
|
—
|
|
—
|
|
850,000
|
|
5,000,000
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
SO
|
1/1/2015
|
|
12/2/2014
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
53,900
|
|
75.70
|
|
1,072,610
|
|
|
Philip P. Conti
|
PSU
|
1/1/2015
|
|
12/2/2014
|
|
—
|
|
—
|
|
—
|
|
—
|
|
17,840
|
|
53,520
|
|
—
|
|
—
|
|
2,517,402
|
|
ESTIP
|
—
|
|
—
|
|
—
|
|
320,000
|
|
5,000,000
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
SO
|
1/1/2015
|
|
12/2/2014
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
20,300
|
|
75.70
|
|
403,970
|
|
|
Theresa Z. Bone
|
PSU
|
1/1/2015
|
|
12/2/2014
|
|
—
|
|
—
|
|
—
|
|
—
|
|
7,580
|
|
22,740
|
|
—
|
|
—
|
|
1,069,614
|
|
ESTIP
|
—
|
|
—
|
|
—
|
|
135,000
|
|
5,000,000
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
SO
|
1/1/2015
|
|
12/2/2014
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
8,700
|
|
75.70
|
|
173,130
|
|
|
Randall L. Crawford
|
PSU
|
1/1/2015
|
|
12/2/2014
|
|
—
|
|
—
|
|
—
|
|
—
|
|
20,810
|
|
62,430
|
|
—
|
|
—
|
|
2,936,499
|
|
ESTIP
|
—
|
|
—
|
|
—
|
|
385,000
|
|
5,000,000
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
SO
|
1/1/2015
|
|
12/2/2014
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
23,700
|
|
75.70
|
|
471,630
|
|
(1)
|
Type of Award:
|
ADJUSTED 2015 EQT EBITDA
COMPARED TO
BUSINESS PLAN
|
|
PERCENTAGE OF ADJUSTED 2015
EQT EBITDA AVAILABLE FOR ALL
EQT EXECUTIVE OFFICER 2015
ANNUAL INCENTIVE AWARDS
|
At or above plan
|
|
2%
|
5% below plan
|
|
1.5%
|
25% below plan
|
|
1%
|
Greater than 25% below plan
|
|
No bonus
|
•
|
no payout if the total unitholder return was less than 10% over the performance period; or
|
•
|
target payout if the total unitholder return equaled or exceeded 10% over the performance period.
|
•
|
EQT’s TSR over the period January 1, 2013 through December 31, 2015, as ranked among the comparably measured TSR of the applicable peer group; and
|
•
|
cumulative cash flow per share, which is the aggregate net cash provided by operating activities excluding changes in other assets and liabilities during the performance period, adjusted to reflect a fixed natural gas price of $2.79 per Mcf, divided by the average diluted common shares outstanding for each year in the performance period.
|
•
|
no payout if EQT was one of the nine lowest-ranking companies in the applicable peer group as to TSR and had cumulative cash flow per share over the performance period of less than $16.59;
|
•
|
to target payout if EQT ranked seventeenth to fourteenth in the applicable peer group as to TSR and had cumulative cash flow per share over the performance period equal to $18.30;
|
•
|
to three times the target award if EQT was one of the four highest-ranking companies in the applicable peer group as to TSR and had cumulative cash flow per share over the performance period of at least $24.15.
|
•
|
EQT’s TSR over the period January 1, 2014 through December 31, 2016, as ranked among the comparably measured TSR of the applicable peer group; and
|
•
|
compound annual production sales volume growth over the performance period.
|
•
|
no payout if EQT is one of the nine lowest-ranking companies in the applicable peer group as to TSR and has compound annual production sales volume growth over the performance period of less than 0%;
|
•
|
to target payout if EQT ranks seventeenth to fourteenth in the applicable peer group as to TSR and has compound annual production sales volume growth over the performance period equal to 10%;
|
•
|
to three times the target award if EQT is one of the four highest-ranking companies in the applicable peer group as to TSR and has compound annual production sales volume growth over the performance period of at least 30%.
|
•
|
no payment if the adjusted 2014 EQT EBITDA was less than EQT’s business plan; or
|
•
|
three times the number of target awards granted if the adjusted 2014 EQT EBITDA equaled or exceeded EQT’s business plan, subject to the EQT MDC Committee’s discretion to determine that a lower performance multiple applied. In exercising its discretion, the EQT MDC Committee was to consider and be guided by performance on EQT, business unit and individual value drivers.
|
•
|
EQT’s TSR over the period January 1, 2015 through December 31, 2017, as ranked among the comparably measured TSR of the applicable peer group; and
|
•
|
compound annual production sales volume growth over the performance period.
|
•
|
no payout if EQT is one of the nine lowest-ranking companies in the applicable peer group as to TSR and has compound annual production sales volume growth over the performance period of less than 0%;
|
•
|
to target payout if EQT ranks seventeenth to fourteenth in the applicable peer group as to TSR and has compound annual production sales volume growth over the performance period equal to 6.4%;
|
•
|
to three times the target award if EQT is one of the four highest-ranking companies in the applicable peer group as to TSR and has compound annual production sales volume growth over the performance period of at least 26.4%.
|
OPTION AWARDS
|
EQUITY AWARDS
|
|||||||||||||||
|
NUMBER OF
SECURITIES
UNDERLYING
UNEXERCISED
OPTIONS
EXERCISABLE
|
NUMBER OF
SECURITIES
UNDERLYING
UNEXERCISED
OPTIONS
UNEXERCISABLE
|
OPTION
EXERCISE
PRICE
|
OPTION
EXPIRATION
DATE
|
NUMBER OF
SHARES OR
UNITS OF
STOCK
THAT HAVE
NOT
VESTED
|
MARKET
VALUE OF
SHARES OR
UNITS OF
STOCK THAT
HAVE NOT
VESTED
|
EQUITY
INCENTIVE
PLAN
AWARDS:
NUMBER OF
UNEARNED
SHARES,
UNITS OR
OTHER
RIGHTS THAT
HAVE NOT
VESTED
|
EQUITY
INCENTIVE
PLAN AWARDS:
MARKET OR
PAYOUT VALUE
OF UNEARNED
SHARES, UNITS
OR OTHER
RIGHTS THAT
HAVE NOT
VESTED
|
||||||||
|
(#)
|
(#) (1)
|
($)
|
|
(#) (2)
|
($) (3)
|
(#) (4)
|
($) (5)
|
||||||||
David L. Porges
|
76,700
|
|
—
|
|
44.84
|
|
1/1/2018
|
|
—
|
|
—
|
|
42,223
|
|
3,186,148
|
|
105,800
|
|
—
|
|
54.79
|
|
1/1/2022
|
|
—
|
|
—
|
|
71,535
|
|
3,729,120
|
|
|
92,400
|
|
—
|
|
58.98
|
|
1/1/2023
|
|
—
|
|
—
|
|
75,063
|
|
3,913,034
|
|
|
—
|
|
47,600
|
|
89.78
|
|
1/1/2024
|
|
—
|
|
—
|
|
142,464
|
|
7,426,648
|
|
|
—
|
|
53,900
|
|
75.70
|
|
1/1/2025
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Philip P. Conti
|
32,400
|
|
—
|
|
54.79
|
|
1/1/2022
|
|
—
|
|
—
|
|
5,962
|
|
449,893
|
|
31,400
|
|
—
|
|
58.98
|
|
1/1/2023
|
|
—
|
|
—
|
|
24,318
|
|
1,267,697
|
|
|
—
|
|
21,100
|
|
89.78
|
|
1/1/2024
|
|
—
|
|
—
|
|
33,183
|
|
1,729,830
|
|
|
—
|
|
20,300
|
|
75.70
|
|
1/1/2025
|
|
—
|
|
—
|
|
53,607
|
|
2,794,533
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Theresa Z. Bone
|
5,000
|
|
—
|
|
44.84
|
|
1/1/2018
|
|
1,004
|
|
52,360
|
|
2,194
|
|
165,559
|
|
—
|
|
8,700
|
|
75.70
|
|
1/1/2025
|
|
3,435
|
|
179,057
|
|
4,008
|
|
208,937
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
8,904
|
|
464,166
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
22,776
|
|
1,187,313
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Randall L. Crawford
|
21,400
|
|
—
|
|
43.92
|
|
1/1/2017
|
|
—
|
|
—
|
|
14,496
|
|
1,093,868
|
|
38,500
|
|
—
|
|
44.84
|
|
1/1/2018
|
|
—
|
|
—
|
|
34,110
|
|
1,778,154
|
|
|
44,800
|
|
—
|
|
54.79
|
|
1/1/2022
|
|
—
|
|
—
|
|
38,721
|
|
2,018,526
|
|
|
44,100
|
|
—
|
|
58.98
|
|
1/1/2023
|
|
—
|
|
—
|
|
62,532
|
|
3,259,793
|
|
|
—
|
|
24,600
|
|
89.78
|
|
1/1/2024
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
|
—
|
|
23,700
|
|
75.70
|
|
1/1/2025
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1)
|
The options reflected in this column are EQT options which vest according to the following schedule: of the options expiring in 2024, 100% will vest on January 1, 2017 and of the options expiring in 2025, 100% will vest on January 1, 2018. The vesting of option awards may accelerate. See “Potential Payments Upon Termination or Change of Control” below for a discussion of, among other things, a revised vesting schedule and circumstances under which the vesting of an award will accelerate.
|
(2)
|
This column reflects Ms. Bone’s (i) unvested EQT restricted stock award (including accrued dividends) and (ii) outstanding performance awards (including accrued dividends) under the 2014 VDPSU. Ms. Bone’s restricted stock award was granted on January 31, 2013 and vested on January 31, 2016. Ms. Bone’s performance awards under the 2014 VDPSU were confirmed by the EQT MDC Committee in the first quarter of 2015, 50% of the confirmed performance awards vested and were paid out in cash in the first quarter of 2015 and the remainder of the performance awards vest upon payment which is expected to occur in the first quarter of 2016, contingent upon Ms. Bone’s continued employment with EQT on the payment date. In the event of a change of control of EQT prior to vesting, the vesting of the restricted stock award and the performance awards under the 2014 VDPSU would have accelerated. See “Potential Payments Upon Termination or Change of Control” below for a discussion of, among other things, circumstances under which the vesting of the awards would have accelerated.
|
(3)
|
This column reflects the payout values at December 31, 2015 of Ms. Bone’s unvested EQT restricted stock award (including accrued dividends) and unvested performance awards under the 2014 VDPSU (including accrued dividends), determined by multiplying the number of shares or units, as applicable, shown in the previous column by $52.13, the closing price of EQT’s common stock on December 31, 2015. The actual payout under the restricted stock award is dependent upon the EQT stock price upon vesting.
|
(4)
|
This column reflects performance units awarded but that had not yet vested at December 31, 2015 pursuant to the EQM TR Program, the 2013 Incentive PSU Program, the 2014 Incentive PSU Program and the 2015 Incentive PSU Program for each of the named executive officers (including accrued dividends for the 2013 Incentive PSU Program, the 2014 Incentive PSU Program, and the 2015 Incentive PSU Program and accrued distributions for the EQM TR Program). The number of performance units under the 2013 Incentive PSU Program, the 2014 Incentive PSU Program, and the 2015 Incentive PSU Program reflects maximum award levels because, through December 31, 2015, payout was projected above the target level for each program. The number of performance units under the EQM TR Program reflects target award levels based upon EQM’s total unitholder return through December 31, 2015. Awards under the 2014 Incentive PSU Program and the 2015 Incentive PSU Program do not vest until payment following the end of the respective performance periods. Awards under the EQM TR Program and the 2013 Incentive PSU Program are expected to vest and be distributed in the first quarter of 2016, contingent upon the executive's continued employment with EQT on the payment date. In the event of a change of control of EQT prior to vesting, the vesting of the awards under the EQM TR Program, the 2013 Incentive PSU Program, the 2014 Incentive PSU Program and the 2015 Incentive PSU Program may accelerate. See “Potential Payments Upon Termination or Change of Control” below for a discussion of, among other things, circumstances under which the vesting of an award will accelerate.
|
(5)
|
This column reflects the payout values at December 31, 2015 of unearned performance units granted under the EQM TR Program, the 2013 Incentive PSU Program, the 2014 Incentive PSU Program and the 2015 Incentive PSU Program for each of the named executive officers (including accrued dividends for the 2013 Incentive PSU Program, the 2014 Incentive PSU Program and the 2015 Incentive PSU Program and accrued distributions for the EQM TR Program). The payout values are determined by multiplying the number of units as shown in the previous column by $52.13, the closing price of EQT’s common stock on December 31, 2015 (or, for the EQM TR Program, by $75.46, the closing price of EQM’s common units on December 31, 2015). The actual payout values under the 2013 Incentive PSU Program, the 2014 Incentive PSU Program and the 2015 Incentive PSU Program will depend upon, among other things, EQT’s actual performance through, and the EQT stock price at the end of, the applicable performance periods. The actual payout values under the EQM TR Program will depend upon, among other things, EQM’s common unit price on the payment date.
|
|
|
OPTION AWARDS
|
|
STOCK AWARDS
|
||||||||
|
|
NUMBER OF EQT SHARES ACQUIRED ON EXERCISE
|
|
VALUE REALIZED ON EXERCISE
|
|
NUMBER OF EQT SHARES ACQUIRED ON VESTING
|
|
VALUE REALIZED ON VESTING
|
||||
NAME
|
|
(#)
|
|
($) (1)
|
|
(#) (2)
|
|
($) (3)
|
||||
David L. Porges
|
|
134,000
|
|
|
6,398,816
|
|
|
110,500
|
|
|
9,014,612
|
|
Philip P. Conti
|
|
28,300
|
|
|
1,303,781
|
|
|
33,795
|
|
|
2,756,988
|
|
Theresa Z. Bone
|
|
—
|
|
|
—
|
|
|
13,449
|
|
|
1,073,703
|
|
Randall L. Crawford
|
|
87,000
|
|
|
2,254,718
|
|
|
46,795
|
|
|
3,817,530
|
|
(1)
|
The value realized on exercise is calculated as the difference between the market price of the shares of EQT common stock underlying the options at exercise and the applicable exercise price of those options.
|
(2)
|
This column reflects the aggregate number of performance awards (including accrued dividends) under the 2012 Executive Performance Incentive Plan (2012 Incentive PSU Program) for each of the named executive officers that vested in 2015. For Ms. Bone, this column also reflects the aggregate number of performance awards (including accrued dividends) under the EQT Corporation 2013 Value Driver Award Program (2013 VDPSU) and the 2014 VDPSU that vested in 2015. The performance awards (including accrued dividends) under the 2012 Incentive PSU Program vested and were distributed in EQT common stock on February 19, 2015. Fifty-percent of the performance awards confirmed by the EQT MDC Committee under the 2013 VDPSU (the second and final tranche) vested and were distributed in EQT common stock on February 12, 2015. Fifty-percent of the performance awards confirmed by the EQT MDC Committee under the 2014 VDPSU (the first tranche) vested and were distributed in cash on February 12, 2015.
|
(3)
|
This column reflects the value realized upon the vesting of performance awards (including accrued dividends) in 2015 under the 2012 Incentive PSU Program for each of the named executive officers and under the 2013 VDPSU and the 2014 VDPSU for Ms. Bone. The value realized on vesting is calculated based on the number of performance awards that vested and the closing price of EQT common stock on the applicable vesting dates.
|
•
|
If the participant’s employment is terminated voluntarily or involuntarily without fault on the participant’s part (including retirement) and the participant remains on the Board of Directors of EQT or the Board of Directors of the EQM General Partner following termination, then the participant’s performance awards continue to vest for so long as the participant remains on such Board; and
|
•
|
If a participant’s employment is otherwise terminated involuntarily and without fault (including a termination resulting from death or disability) prior to payment, the participant may receive payment for a percentage of the participant’s performance units following termination of the performance period, contingent upon achievement of the performance condition, as follows:
|
TERMINATION DATE
|
AWARDED UNITS
|
January 1, 2015 and thereafter
|
50%
|
TERMINATION DATE
|
AWARDED UNITS
|
January 1, 2015 – December 31, 2015
|
50%
|
TERMINATION DATE
|
AWARDED UNITS
|
January 1, 2015 and thereafter
|
50%
|
EXECUTIVE BENEFITS
AND PAYMENTS UPON TERMINATION
|
TERMINATION BY EQT WITHOUT CAUSE
($)
|
TERMINATION BY EQT FOR CAUSE
($)
|
TERMINATION BY EXECUTIVE FOR GOOD REASON
($)
|
TERMINATION BY EXECUTIVE WITHOUT GOOD REASON
($)
|
DEATH
($)
|
DISABILITY
($)
|
|||||
Compensation:
|
|
|
|
|
|
|
|||||
Cash Payment of Base Salary
|
600,000
|
|
0
|
600,000
|
|
0
|
|
0
|
|
0
|
|
Cash Payment of Short-Term Incentives
|
546,666
|
|
0
|
546,666
|
|
255,000
|
|
255,000
|
|
255,000
|
|
Executive Alternative Work Arrangement Compensation
|
281,890
|
|
0
|
0
|
|
281,890
|
|
0
|
|
0
|
|
Other Benefits and Perquisites:
|
|
|
|
|
|
|
|||||
EQT Severance Benefit
|
162,558
|
|
0
|
0
|
|
0
|
|
0
|
|
0
|
|
Qualified Retirement Contribution
|
0
|
|
0
|
0
|
|
0
|
|
0
|
|
0
|
|
Post-Termination Health Care / Insurance
|
7,125
|
|
0
|
0
|
|
0
|
|
0
|
|
0
|
|
Life Insurance Proceeds
|
0
|
|
0
|
0
|
|
0
|
|
300,000
|
|
0
|
|
Cash Payment
|
15,251
|
|
0
|
15,251
|
|
0
|
|
0
|
|
0
|
|
Outplacement or Cash Payment
|
200,000
|
|
0
|
200,000
|
|
0
|
|
0
|
|
0
|
|
Total (excluding long-term incentive)
|
1,813,490
|
|
0
|
1,361,917
|
|
536,890
|
|
555,000
|
|
255,000
|
|
•
|
An annual cash retainer of $47,000.
|
•
|
A cash meeting fee of $1,500 for each Board and committee meeting attended in person. If a director participates in a meeting by telephone, the meeting fee is $750.
|
•
|
For the Audit Committee Chair and the Conflicts Committee Chair, an annual committee chair retainer of $10,000.
|
NAME
|
|
FEES EARNED OR PAID IN CASH
($) (1)
|
|
STOCK
AWARDS
($) (2)
|
|
ALL OTHER
COMPENSATION
($) (3)
|
|
TOTAL
($)
|
||||
Michael A. Bryson
|
|
78,750
|
|
|
65,120
|
|
|
26,058
|
|
|
169,928
|
|
Julian M. Bott
|
|
75,000
|
|
|
65,120
|
|
|
658
|
|
|
140,778
|
|
Lara E. Washington
|
|
68,750
|
|
|
65,120
|
|
|
11,808
|
|
|
145,678
|
|
(1)
|
Includes annual cash retainer, meeting fees and committee chair fees.
|
(2)
|
This column reflects the aggregate grant date fair values determined in accordance with FASB ASC Topic 718 for the phantom units awarded to each director during 2015. On January 1, 2015, the EQM General Partner granted 740 phantom units to each non-employee director who was a member of the Board of the EQM General Partner at the time of grant. The grant date fair value is computed as the sum of the number of phantom units awarded on the grant date multiplied by the closing price of EQM’s common units on the business day prior to the grant, which closing price was $88.00 on December 31, 2014.
|
(3)
|
This column reflects (i) annual premiums of $57.63 per director paid for life insurance and travel accident insurance policies and (ii) the following matching gifts made to qualifying organizations under the EQT Foundation’s Matching Gifts Program: Mr. Bryson - $26,000; Mr. Bott - $600; and Ms. Washington - $11,750. The non-employee directors may use a de minimis number of tickets purchased by EQT to attend sporting or other events when such tickets are not otherwise being used for business purposes. The use of such tickets does not result in any incremental costs to EQM.
|
•
|
each of the directors of the EQM General Partner;
|
•
|
each of the named executive officers of the EQM General Partner; and
|
•
|
all directors and executive officers of the EQM General Partner as a group.
|
NAME OF BENEFICIAL OWNER (1)
|
|
EQM COMMON
UNITS
BENEFICIALLY
OWNED (2) (3)
|
|
PERCENTAGE
OF EQM
COMMON
UNITS
BENEFICIALLY
OWNED
|
|
EQGP COMMON UNITS BENEFICIALLY OWNED (2)
|
|
PERCENTAGE
OF EQGP
COMMON
UNITS
BENEFICIALLY
OWNED
|
|
David L. Porges
|
|
20,000
|
|
|
*
|
|
56,263
|
|
*
|
Philip P. Conti
|
|
9,750
|
|
|
*
|
|
28,503
|
|
*
|
Randall L. Crawford
|
|
25,000
|
|
|
*
|
|
100,000
|
|
*
|
Lewis B. Gardner
|
|
6,063
|
|
|
*
|
|
28,503
|
|
*
|
Theresa Z. Bone
|
|
10,000
|
|
|
*
|
|
19,986
|
|
*
|
Julian M. Bott
|
|
8,636
|
|
|
*
|
|
—
|
|
*
|
Michael A. Bryson (4)
|
|
10,636
|
|
|
*
|
|
—
|
|
*
|
Lara E. Washington
|
|
3,771
|
|
|
*
|
|
—
|
|
*
|
All directors and executive officers as a group (8 individuals)
|
|
93,856
|
|
|
*
|
|
233,255
|
|
*
|
(1)
|
Unless otherwise indicated, the address for all beneficial owners in this table is c/o EQT Midstream Partners, LP, 625 Liberty Avenue, Suite 1700, Pittsburgh, PA 15222, Attn: Corporate Secretary.
|
(2)
|
This column reflects the number of common units held of record or owned through a bank, broker or other nominee.
|
(3)
|
For Messrs. Bott and Bryson and Ms. Washington, this column includes phantom units, including accrued distributions, to be settled in EQM common units, in the following amounts: Mr. Bott - 6,636 units; Mr. Bryson - 6,636 units; and Ms. Washington - 3,771 units.
|
(4)
|
EQM common units beneficially owned include 2,000 common units that are held in Mrs. Bryson's revocable trust.
|
NAME OF BENEFICIAL
OWNER
|
|
COMMON UNITS BENEFICIALLY OWNED
|
|
PERCENTAGE OF COMMON UNITS BENEFICIALLY OWNED
|
||
EQT Corporation
(1)
|
|
21,811,643
|
|
|
28.1
|
%
|
625 Liberty Avenue
|
|
|
|
|
|
|
Pittsburgh, PA 15222
|
|
|
|
|
|
|
Tortoise Capital Advisors, L.L.C.
(2)
|
|
7,793,194
|
|
|
10.1
|
%
|
11550 Ash Street, Suite 300
|
|
|
|
|
|
|
Leawood, KS 66211
|
|
|
|
|
|
|
Goldman Sachs Asset Management, L.P.
(3)
|
|
5,807,885
|
|
|
7.5
|
%
|
200 West Street
|
|
|
|
|
|
|
New York, NY 10282
|
|
|
|
|
|
|
ALPS Advisors, Inc.
(4)
|
|
4,287,352
|
|
|
5.53
|
%
|
1290 Broadway, Suite 1100
|
|
|
|
|
||
Denver, CO 80203
|
|
|
|
|
(1)
|
EQGP held
21,811,643
EQM common units as of
February 1, 2016
. EQT is the ultimate parent company of EQGP and may, therefore, be deemed to beneficially own the units held by EQGP.
|
(2)
|
Information based on a SEC Schedule 13G filed on January 8, 2016 reporting that Tortoise Capital Advisors, L.L.C. has sole voting and dispositive power over 115,848 common units, shared voting power over 7,044,356 common units and shared dispositive power over 7,677,346 common units.
|
(3)
|
Information based on a SEC Schedule 13G filed on February 9, 2016 reporting that Goldman Sachs Asset Management, L.P. has shared voting and dispositive power over
5,807,885
common units.
|
(4)
|
Information based on a SEC Schedule 13G filed on February 3, 2016 reporting that ALPS Advisors, Inc. has shared voting and dispositive power over
4,287,352
common units, of which
4,268,459
common units are attributable to Alerian MLP ETF, an investment company to which ALPS Advisors, Inc. furnishes investment advice. Alerian MLP ETF has shared voting and dispositive power with respect to the
4,268,459
common units.
|
Name
|
|
Exercisable
Stock Options (1)
|
|
Number of Shares
Beneficially Owned (2)
|
|
Percent of
Class (3)
|
David L. Porges
(4)
|
|
274,900
|
|
529,517
|
|
*
|
Philip P. Conti
(5)
|
|
63,800
|
|
113,648
|
|
*
|
Randall L. Crawford
|
|
148,800
|
|
64,210
|
|
*
|
Lewis B. Gardner
|
|
13,200
|
|
23,591
|
|
*
|
Theresa Z. Bone
|
|
5,000
|
|
24,636
|
|
*
|
Julian M. Bott
|
|
—
|
|
—
|
|
—
|
Michael A. Bryson
|
|
—
|
|
—
|
|
—
|
Lara E. Washington
|
|
—
|
|
—
|
|
—
|
Directors and executive officers as a group (8 individuals)
|
|
505,700
|
|
755,602
|
|
*
|
(1)
|
This column reflects the number of shares of EQT common stock that the executive officers and directors had a right to acquire within 60 days after
February 1, 2016
through the exercise of stock options.
|
(2)
|
This column reflects shares held of record and shares owned through a bank, broker or other nominee, including, for EQT employees, shares owned through EQT’s 401(k) plan.
|
(3)
|
This column reflects for each of the executive officers and directors, as well as all executive officers and directors as a group, (i) the sum of the shares beneficially owned and the stock options exercisable within 60 days of
February 1, 2016
, as a percentage of (ii) the sum of EQT’s outstanding shares at
February 1, 2016
, and all options exercisable within 60 days of
February 1, 2016
.
|
(4)
|
Shares beneficially owned include 50,000 shares that are held in a trust of which Mr. Porges is a co-trustee and in which he shares voting and investment power.
|
(5)
|
Shares beneficially owned include 5,000 shares that are held in the Conti Family Foundation in which Mr. Conti has sole voting and investment power.
|
PLAN CATEGORY
|
|
NUMBER OF
SECURITIES TO
BE
ISSUED UPON
EXERCISE OF
OUTSTANDING
OPTIONS,
WARRANTS
AND RIGHTS
|
|
WEIGHTED
AVERAGE
EXERCISE PRICE OF
OUTSTANDING
OPTIONS,
WARRANTS AND
RIGHTS
|
|
NUMBER OF
SECURITIES
REMAINING
AVAILABLE FOR
FUTURE ISSUANCE
UNDER
EQUITY
COMPENSATION
PLANS (EXCLUDING
SECURITIES
REFLECTED IN
COLUMN A)
|
|||
|
|
(A)
|
|
(B)
|
|
(C)
|
|||
Equity Compensation Plans Approved by Unitholders
|
|
—
|
|
|
—
|
|
|
—
|
|
Equity Compensation Plans Not Approved by Unitholders(1)
|
|
227,283
|
|
|
N/A
|
|
|
1,545,433
|
|
Total
|
|
227,283
|
|
|
N/A
|
|
|
1,545,433
|
|
(1)
|
The Board adopted the 2012 Long-Term Incentive Plan in connection with the IPO of EQM’s common units.
|
•
|
EQM’s obligation to reimburse EQT and its affiliates for certain direct operating expenses paid on EQM’s behalf;
|
•
|
EQM’s obligation to reimburse EQT and its affiliates for providing EQM corporate, general and administrative services (the “general and administrative expenses”);
|
•
|
EQM’s obligation to reimburse EQT and its affiliates for operation and management services pursuant to the operation and management services agreement with EQT, as described below under "Operation and Management Services Agreement" (the “operation and management expenses”);
|
•
|
EQT's obligation to indemnify or reimburse EQM for losses or expenses relating to or arising from, among other things, (i) certain plugging and abandonment obligations; (ii) certain bare steel replacement capital expenditures; (iii) certain pipeline safety costs; (iv) certain tax liabilities attributable to periods prior to the IPO; (v) assets previously owned by Equitrans, L.P. (Equitrans) and retained by EQT and its affiliates, including the Sunrise Pipeline; (vi) any claims related to Equitrans' previous ownership of the Big Sandy Pipeline; and (vii) any amounts owed to EQM by a third party that has exercised a contractual right of offset against amounts owed by EQT to such third party;
|
•
|
EQM’s obligation to indemnify EQT for losses attributable to (i) the ownership or operation of EQM’s assets after the closing of the IPO, except to the extent EQT is obligated to indemnify EQM for such losses pursuant to the operation and management services agreement; and (ii) any amounts owed to EQT by a third party that has exercised a contractual right of offset against amounts owed by EQM to such third party; and
|
•
|
EQM’s use of the name "EQT" and related marks.
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
DESCRIPTION OF EXPENSES
|
|
|
|
|
|
|
|
||||
Reimbursement of operation and management expenses
|
$
|
31,310
|
|
|
$
|
21,999
|
|
|
$
|
14,296
|
|
Reimbursement of general and administrative expenses
|
$
|
46,149
|
|
|
$
|
25,051
|
|
|
$
|
18,322
|
|
•
|
Plugging and abandonment liabilities.
For a period of ten years after the closing of the IPO, which occurred on July 2, 2012, EQT is required to reimburse EQM for plugging and abandonment expenditures and other expenditures for certain identified wells of EQT and third parties. The reimbursement obligation of EQT with respect to wells owned by third parties is capped at $1.2 million per year.
|
•
|
Bare steel replacement.
EQT is required to reimburse EQM for bare steel replacement capital expenditures in the event that ongoing maintenance capital expenditures (other than capital expenditures associated with plugging and abandonment liabilities to be reimbursed by EQT) exceed $17.2 million (with respect to EQM’s assets at the time of the IPO) in any year. If such ongoing maintenance capital expenditures and bare steel replacement capital expenditures exceed $17.2 million during a year, EQT is required to reimburse EQM for the lesser of (i) the amount of bare steel replacement capital expenditures during such year and (ii) the amount by which such ongoing capital expenditures and bare steel replacement capital expenditures exceeds $17.2 million. This bare steel replacement reimbursement obligation is capped at an aggregate amount of $31.5 million over the ten years following the IPO.
|
•
|
Pipeline Safety Cost Tracker Reimbursement.
For a period of five years after the closing of the IPO, EQT is required to reimburse EQM for the amount by which the qualifying pipeline safety costs included in the annual pipeline safety cost tracker filings made by Equitrans with the FERC exceed the qualifying pipeline safety costs actually recovered each year.
|
•
|
Taxes.
Until 60 days after the expiration of any applicable statute of limitations, EQT will indemnify EQM for any income taxes attributable to operations or ownership of the assets prior to the closing of the IPO, including any such income tax liability of EQT and its affiliates that may result from EQM’s formation transactions.
|
•
|
Retained liabilities.
EQT is required to indemnify EQM for any liabilities, claims or losses relating to or arising from assets owned or previously owned by EQM and retained by EQT and its affiliates following the closing of the IPO.
|
•
|
Big Sandy Pipeline.
EQT is required to indemnify EQM for any claims related to Equitrans' previous ownership of the Big Sandy Pipeline, which was sold to a third party, including claims arising under the Big Sandy Purchase Agreement.
|
•
|
Contractual Offsets.
EQT is required to indemnify EQM for any amounts owed to EQM by a third party that has exercised a contractual right of offset against amounts owed by EQT to such third party.
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
DESCRIPTION OF OBLIGATION
|
|
|
|
|
|
|
|
||||
Plugging and abandonment liabilities
|
$
|
26
|
|
|
$
|
500
|
|
|
$
|
566
|
|
Bare steel replacement
|
6,268
|
|
|
—
|
|
|
2,566
|
|
|||
Other capital reimbursements
|
$
|
1,198
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(Thousands)
|
||||||||||
DESCRIPTION OF REVENUE
|
|
|
|
|
|
|
|
||||
Transmission and storage
|
$
|
141,198
|
|
|
$
|
116,357
|
|
|
$
|
135,998
|
|
Gathering
|
$
|
306,389
|
|
|
$
|
212,170
|
|
|
$
|
174,247
|
|
•
|
approved by the Conflicts Committee of the EQM General Partner, although the EQM General Partner is under no obligation to seek such approval;
|
•
|
approved by the vote of a majority of the outstanding common units, excluding any common units owned by the EQM General Partner or any of its affiliates;
|
•
|
determined by the Board to be on terms no less favorable to EQM than those generally being provided to or available from unrelated third parties; or
|
•
|
determined by the Board to be fair and reasonable to EQM, taking into account the totality of the relationships among the parties involved, including other transactions that may be particularly favorable or advantageous to EQM.
|
|
Years Ended December 31,
|
||||||
|
2015
|
|
2014
|
||||
Audit fees
(1)
|
$
|
1,119,436
|
|
|
$
|
711,458
|
|
Audit-related fees
(2)
|
52,500
|
|
|
647,500
|
|
||
Tax fees
|
—
|
|
|
—
|
|
||
All other fees
|
—
|
|
|
—
|
|
||
Total
|
$
|
1,171,936
|
|
|
$
|
1,358,958
|
|
(1)
|
Includes fees for the audit of EQM’s annual financial statements and internal control over financial reporting, reviews of financial statements included in EQM’s quarterly reports on Form 10-Q, and services that are normally provided in connection with statutory and regulatory filings or engagements, including certain attest engagements, comfort letter procedures and consents.
|
(2)
|
Includes fees for services associated with EQM acquisitions from EQT and attest engagements not required by statute or regulation.
|
•
|
Bookkeeping or other services related to the accounting records or financial statements
|
•
|
Financial information systems design and implementation
|
•
|
Appraisal or valuation services, fairness opinions or contribution-in-kind reports
|
•
|
Actuarial services
|
•
|
Internal audit outsourcing services
|
•
|
Management functions
|
•
|
Human resources functions
|
•
|
Broker-dealer, investment adviser or investment banking services
|
•
|
Legal services
|
•
|
Expert services unrelated to the audit
|
•
|
Prohibited tax services
|
(a)
|
|
1
|
|
|
Financial Statements
|
|
|
|
|
The financial statements listed in the accompanying index to financial statements are filed as part of this Annual Report on Form 10-K.
|
|
|
|
2
|
|
|
Financial Statement Schedules
|
|
|
|
|
All schedules are omitted since the subject matter thereof is either not present or is not present in amounts sufficient to require submission of the schedules.
|
|
|
|
3
|
|
|
Exhibits
|
|
|
|
|
The exhibits listed on the accompanying index to exhibits (pages
127
through 131) are filed as part of this Annual Report on Form 10-K.
|
|
|
Page Reference
|
Statements of Consolidated Operations for each of the three years in the period ended December 31, 2015
|
|
|
Statements of Consolidated Cash Flows for each of the three years in the period ended December 31, 2015
|
|
|
Consolidated Balance Sheets as of December 31, 2015 and 2014
|
|
|
Statements of Consolidated Partners’ Capital for each of the three years in the period ended December 31, 2015
|
|
|
Notes to Consolidated Financial Statements
|
|
Exhibits
|
Description
|
Method of Filing
|
2.1
|
Agreement and Plan of Merger, dated as of July 15, 2013, by and among EQT Investments Holdings, LLC, EQT Midstream Services, LLC, Sunrise Pipeline, LLC, EQT Midstream Partners, LP and Equitrans, L.P. EQT Midstream Partners, LP will furnish supplementally a copy of any omitted schedule and similar attachment to the SEC upon request.
|
Incorporated herein by reference to Exhibit 2.1 to Form 8-K (#001-35574) filed on July 15, 2013.
|
2.2
|
Contribution Agreement, dated as of April 30, 2014, by and among EQT Midstream Partners, LP, EQT Midstream Services, LLC, EQM Gathering Opco, LLC and EQT Gathering, LLC. EQT Midstream Partners, LP will furnish supplementally a copy of any omitted schedule and similar attachment to the SEC upon request.
|
Incorporated herein by reference to Exhibit 2.1 to Form 8-K (#001-35574) filed on April 30, 2014.
|
2.3
|
Contribution and Sale Agreement, dated as of March 10, 2015, by and among EQT Midstream Partners, LP, EQT Midstream Services, LLC, EQM Gathering Opco, LLC, EQT Corporation, EQT Gathering, LLC, EQT Energy Supply Holdings, LP, and EQT Energy, LLC. EQT Midstream Partners, LP will furnish supplementally a copy of any omitted schedule and similar attachment to the SEC upon request.
|
Incorporated herein by reference to Exhibit 2.1 to Form 8-K (#001-35574) filed on March 10, 2015.
|
3.1
|
Certificate of Limited Partnership of EQT Midstream Partners, LP.
|
Incorporated herein by reference to Exhibit 3.1 to Form S-1 Registration Statement (#333-179487) filed on February 13, 2012.
|
3.2
|
First Amended and Restated Agreement of Limited Partnership of EQT Midstream Partners, LP, dated as of July 2, 2012.
|
Incorporated herein by reference to Exhibit 3.2 to Form 8-K (#001-35574) filed on July 2, 2012.
|
3.3
|
Amendment No. 1 to the First Amended and Restated Agreement of Limited Partnership of EQT Midstream Partners, LP, dated as of July 24, 2014.
|
Incorporated herein by reference to Exhibit 3.1 to Form 10-Q (#001-35574) for the quarterly period ended June 30, 2014.
|
3.4
|
Amendment No. 2 to the First Amended and Restated Agreement of Limited Partnership of EQT Midstream Partners, LP, dated as of July 23, 2015.
|
Incorporated herein by reference to Exhibit 3.1 to Form 10-Q (#001-35574) for the quarterly period ended June 30, 2015.
|
3.5
|
Certificate of Formation of EQT Midstream Services, LLC.
|
Incorporated herein by reference to Exhibit 3.3 to Form S-1 Registration Statement (#333-179487) filed on February 13, 2012.
|
3.6
|
Third Amended and Restated Limited Liability Company Agreement of EQT Midstream Services, LLC, dated as of May 15, 2015.
|
Incorporated herein by reference to Exhibit 3.1 to Form 8-K (#001-35574) filed on May 15, 2015.
|
4.1
|
Indenture, dated as of August 1, 2014, by and among EQT Midstream Partners, LP, as issuer, the subsidiary guarantors party thereto, and The Bank of New York Mellon Trust Company, N.A., as trustee.
|
Incorporated herein by reference to Exhibit 4.1 to Form 8-K (#001-35574) filed on August 1, 2014.
|
4.2
|
First Supplemental Indenture, dated as of August 1, 2014, by and among EQT Midstream Partners, LP, as issuer, the subsidiary guarantors party thereto, and The Bank of New York Mellon Trust Company, N.A., as trustee.
|
Incorporated herein by reference to Exhibit 4.2 to Form 8-K (#001-35574) filed on August 1, 2014.
|
10.1
|
Contribution, Conveyance and Assumption Agreement, dated as of July 2, 2012, by and among EQT Midstream Partners, LP, EQT Midstream Services, LLC, Equitrans Investments, LLC, Equitrans, L.P., Equitrans Services, LLC, EQT Midstream Investments, LLC, EQT Investments Holdings, LLC, ET Blue Grass, LLC and EQT Corporation.
|
Incorporated herein by reference to Exhibit 10.1 to Form 8-K (#001-35574) filed on July 2, 2012.
|
Exhibits
|
Description
|
Method of Filing
|
10.13(a)
|
Sublease Agreement, effective as of March 1, 2011, by and between Equitrans, L.P. and EQT Production Company.
|
Incorporated herein by reference to Exhibit 10.12 to Amendment No. 2 to Form S-1 Registration Statement (#333-179487) filed on May 10, 2012.
|
10.13(b)
|
Amendment of Sublease Agreement, dated as of April 5, 2012, by and between Equitrans, L.P. and EQT Production Company.
|
Incorporated herein by reference to Exhibit 10.13 to Amendment No. 2 to Form S-1 Registration Statement (#333-179487) filed on May 10, 2012.
|
10.14
|
EQT Guaranty dated as of April 25, 2012, executed by EQT Corporation in favor of Equitrans, L.P.
|
Incorporated herein by reference to Exhibit 10.11 to Amendment No. 2 to Form S-1 Registration Statement (#333-179487) filed on May 10, 2012.
|
10.15
|
Sunrise Facilities Amended and Restated Lease Agreement by and between Equitrans, L.P. and Sunrise Pipeline, L.L.C., as amended and restated as of October 25, 2012.
|
Incorporated herein by reference to Exhibit 10.19 to Form 10-Q (#001-35574) for the quarterly period ended September 30, 2012.
|
10.16
|
Form of Transportation Service Agreement Applicable to Firm Transportation Service Under Rate Schedule FTS by and between Equitrans, L.P. and Equitable Gas Company, LLC.
|
Incorporated herein by reference to Exhibit 10.9 to Amendment No. 2 to Form S-1 Registration Statement (#333-179487) filed on May 10, 2012.
|
10.17
|
Form of Transportation Service Agreement Applicable to No-Notice Firm Transportation Service Under Rate Schedule NOFT by and between Equitrans, L.P. and Equitable Gas Company, LLC.
|
Incorporated herein by reference to Exhibit 10.10 to Amendment No. 2 to Form S-1 Registration Statement (#333-179487) filed on May 10, 2012.
|
10.18
|
Agreement to Extend Services Agreements, dated as of December 10, 2013, by and between Equitrans, L.P. and Equitable Gas Company, LLC.
|
Incorporated herein by reference to Exhibit 10.10 to Form 10-K (#001-35574) for the year ended December 31, 2013.
|
10.19
|
Transportation Service Agreement Applicable to Firm Transportation Service Under Rate Schedule FTS, Contract No. EQTR 18679-852, dated as of December 20, 2013, by and between Equitrans, L.P. and EQT Energy, LLC.
|
Incorporated herein by reference to Exhibit 10.16 to Form 10-K (#001-35574) for the year ended December 31, 2013.
|
10.20
|
Sunrise Expansion Precedent Agreement, dated as of May 30, 2013, by and between Equitrans, L.P. and EQT Energy, LLC.
|
Incorporated herein by reference to Exhibit 10.17 to Form 10-K (#001-35574) for the year ended December 31, 2013.
|
10.21
|
Precedent Agreement, dated as of July 23, 2014, by and between Equitrans, L.P. and EQT Energy, LLC.
|
Incorporated herein by reference to Exhibit 10.2 to Form 10-Q (#001-35574) for the quarterly period ended June 30, 2014.
|
10.22
|
Transportation Service Agreement Applicable to Firm Transportation Service Under Rate Schedule FTS, Contract No. EQTR 20242-852, dated as of September 24, 2014, by and between Equitrans, L.P. and EQT Energy, LLC.
|
Incorporated herein by reference to Exhibit 10.5 to Form 10-Q (#001-35574) for the quarterly period ended September 30, 2015.
|
10.23
|
Transportation Service Agreement Applicable to Firm Transportation Service Under Rate Schedule FTS, dated as of January 8, 2016, by and between Equitrans, L.P. and EQT Energy, LLC.
|
Filed herewith as Exhibit 10.23.
|
10.24(a)
|
Jupiter Gas Gathering Agreement, effective as of May 1, 2014, by and among EQT Production Company and EQT Energy, LLC, on the one hand, and EQM Gathering Opco, LLC (as assignee of EQT Gathering, LLC), on the other hand. Specific items in this exhibit have been redacted, as marked by three asterisks [***], because confidential treatment for those items was granted by the SEC. The redacted material has been separately filed with the SEC.
|
Incorporated herein by reference to Exhibit 10.1 to Form 10-Q (#001-35574) for the quarterly period ended June 30, 2014.
|
Exhibits
|
Description
|
Method of Filing
|
31.2
|
Rule 13(a)-14(a) Certification of Principal Financial Officer.
|
Filed herewith as Exhibit 31.2.
|
32
|
Section 1350 Certification of Principal Executive Officer and Principal Financial Officer.
|
Furnished herewith as Exhibit 32.
|
99
|
Named Executive Officer Compensation 2016 Peer Companies (General Industry)
|
Filed herewith as Exhibit 99.
|
101
|
Interactive Data File.
|
Filed herewith as Exhibit 101.
|
|
EQT Midstream Partners, LP
|
|
|
|
|
|
By: EQT Midstream Services, LLC, its General Partner
|
|
|
|
|
|
By:
|
/s/ DAVID L. PORGES
|
|
|
David L. Porges
|
|
|
President and Chief Executive Officer
|
|
|
February 11, 2016
|
/s/ DAVID L. PORGES
|
|
Chairman, President and Chief Executive Officer
|
|
February 11, 2016
|
David L. Porges
|
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
|
|
/s/ PHILIP P. CONTI
|
|
Director, Senior Vice President and Chief Financial Officer
|
|
February 11, 2016
|
Philip P. Conti
|
|
|
|
|
(Principal Financial Officer)
|
|
|
|
|
|
|
|
|
|
/s/ THERESA Z. BONE
|
|
Vice President, Finance and Chief Accounting Officer
|
|
February 11, 2016
|
Theresa Z. Bone
|
|
|
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
|
|
|
|
/s/ JULIAN M. BOTT
|
|
Director
|
|
February 11, 2016
|
Julian M. Bott
|
|
|
|
|
|
|
|
|
|
/s/ MICHAEL A. BRYSON
|
|
Director
|
|
February 11, 2016
|
Michael A. Bryson
|
|
|
|
|
|
|
|
|
|
/s/ RANDALL L. CRAWFORD
|
|
Director
|
|
February 11, 2016
|
Randall L. Crawford
|
|
|
|
|
|
|
|
|
|
/s/ LEWIS B. GARDNER
|
|
Director
|
|
February 11, 2016
|
Lewis B. Gardner
|
|
|
|
|
|
|
|
|
|
/s/ LARA E. WASHINGTON
|
|
Director
|
|
February 11, 2016
|
Lara E. Washington
|
|
|
|
|
___
|
This Agreement supersedes, terminates, and cancels Contract No. _____, dated _____________. The superseded contract is no longer in effect.
|
6.
|
The Receipt and Delivery Points are stated in Exhibit A to this Agreement.
|
CUSTOMER:
|
|
EQUITRANS, L.P.:
|
By
/s/ Paul Kress 1/8/16
|
|
By
/s/ David Gray 1/8/16
|
(Date)
|
|
(Date)
|
Title
Vice President
|
|
Title
Senior Vice President
|
1.
|
Notices and Correspondence shall be sent to:
|
2.
|
Service Under this Agreement is provided on:
|
CUSTOMER:
|
|
EQUITRANS, L.P.:
|
By
/s/ Paul Kress 1/8/16
|
|
By
/s/ David Gray 1/8/16
|
(Date)
|
|
(Date)
|
Title
Vice President
|
|
Title
Senior Vice President
|
CUSTOMER:
|
|
EQUITRANS, L.P.:
|
By
/s/ Paul Kress 1/8/16
|
|
By
/s/ David Gray 1/8/16
|
(Date)
|
|
(Date)
|
Title
Vice President
|
|
Title
Senior Vice President
|
Receipt Point(s)
|
Receipt Point MDQ MMcf/Day
|
Zone
|
Zone MDQ MMcf/Day
|
Alpha
|
80
|
Zone3
|
370
|
Meter ID
|
Meter
Name
|
GPS Coordinates
|
MA
OP
|
MinDQ
*
(Mcf /
Day)
|
MaxDQ (Mcf / Day)
|
17042
|
Pyles
|
39.969918, -80.110996
|
1440
|
1,670
|
78,500
|
17115
|
Thompson2
|
39.948602, -80.096748
|
720
|
680
|
45,900
|
M5220213
|
Petitt 1
|
39.94523, -80.23994
|
720
|
1,227
|
44,838
|
M5220220
|
Petitt 2
|
39.94523, -80.23994
|
720
|
1,227
|
44,838
|
M5220221
|
Petitt 3
|
39.94523, -80.23994
|
720
|
726
|
26,240
|
M5224083
|
Nicoloff
|
39.954037, -80.065039
|
1440
|
1,227
|
44,838
|
M5224627
|
Alpha 1
|
39.960097, -80.130604
|
1440
|
1,227
|
44,838
|
M5224714
|
Alpha 2
|
39.960097, -80.130604
|
1440
|
1,227
|
44,838
|
c.
|
Section III(A)(2) of
Exhibit F
attached to the Agreement is hereby amended to add a responsibilities table for each of the meters added pursuant to Section 2(b) of this Amendment, which establishes the design, construction, operation, maintenance and cost responsibility for each meter. Copies of such responsibilities table for each of the meters are attached hereto and incorporated herein by reference.
|
Pyles, 17042
STATION EQUIPMENT
|
REQUIRED
|
DESIGN
|
INSTALL
|
OWNERSHIP
|
OPERATE
|
MAINTAIN
|
SPECIAL PROVISIONS/ EQUIPMENT SPECS.
|
PIPING
|
|
|
|
|
|
|
|
Pipeline-Tap Value
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
6 Inch Tee & Valve ANSI 600
|
Inlet & Station Piping
|
Yes
|
Producer
|
Producer
|
Producer
|
Producer
|
Producer
|
6” Coated
|
Outlet & Station Piping
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Test Station – inlet piping
|
Yes
|
Producer
|
Producer
|
Producer
|
Producer
|
Producer
|
|
Test Station – outlet piping
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
|
Corrosion coupon
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
|
GAS CONDITIONING
|
|
|
|
|
|
|
|
Filler Separator
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Producer
|
Producer
|
EQT-Approved
Peco Cyclotube |
Liquid Level Shutoff
|
No
|
|
|
|
|
|
Auto Shutoff
|
MEASUREMENT
|
|
|
|
|
|
|
|
Meter & Meter Runs
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
8 Inch Orifice Metter ANSI 600
|
Meter & Flow Control Risers, Valves, etc…
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
8 Inch ANSI 600
|
Electronic Measurement & Telecom Hardware
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Fisher 107
|
GAS QUALITY
|
|
|
|
|
|
|
|
Chromatograph
|
No
|
|
|
|
|
|
|
Continuous Sampler
|
No
|
|
|
|
|
|
|
H2O Dew Point Analyzer
|
No
|
|
|
|
|
|
|
Oxygen Analyzer
|
No
|
|
|
|
|
|
|
H2S Monitor
|
No
|
|
|
|
|
|
|
PRESSURE / FLOW CONTROL
|
|
|
|
|
|
|
|
Primary Pressure Control
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Overpressure Device
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Station Isolation Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Flow Control Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Heat
|
No
|
|
|
|
|
|
|
Check Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Producer
|
Producer
|
|
ODORIZATION
|
|
|
|
|
|
|
|
Odorizer & Controls
|
No
|
|
|
|
|
|
|
MISCELLANEOUS
|
|
|
|
|
|
|
|
Communication service
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Radio
|
Electrical Service
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Solar & Battery
|
Building – Gas Chromatograph
|
No
|
|
|
|
|
|
|
Building – Odorizer
|
No
|
|
|
|
|
|
|
Fence/Vehicle Barrier/Signage
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Air Permit
|
No
|
|
|
|
|
|
|
Thompson 1, 17043
Thompson 2, 17115
STATION EQUIPMENT
|
REQUIRED
|
DESIGN
|
INSTALL
|
OWNERSHIP
|
OPERATE
|
MAINTAIN
|
SPECIAL PROVISIONS/ EQUIPMENT SPECS.
|
PIPING
|
|
|
|
|
|
|
|
Pipeline-Tap Value
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
One 6-inch tee & valve ANSI 300; one 8-inch tee & valve ANSI 300
|
Inlet & Station Piping
|
Yes
|
Producer
|
Producer
|
Producer
|
Producer
|
Producer
|
6” coated
|
Outlet & Station Piping
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Two 6” lines, one to existing 6” tee and other to 8” tee
|
Test Station – inlet piping
|
Yes
|
Producer
|
Producer
|
Producer
|
Producer
|
Producer
|
|
Test Station – outlet piping
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
|
Corrosion coupon
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
|
GAS CONDITIONING
|
|
|
|
|
|
|
|
Filler Separator
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Producer
|
Producer
|
|
Liquid Level Shutoff
|
No
|
|
|
|
|
|
Auto Shutoff
|
MEASUREMENT
|
|
|
|
|
|
|
|
Meter & Meter Runs
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Two 6-inch orifice meters ANSI 300 (existing)
|
Meter & Flow Control Risers, Valves, etc…
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
6 Inch ANSI 300 (existing)
|
Electronic Measurement & Telecom Hardware
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Fisher 107 (existing)
|
GAS QUALITY
|
|
|
|
|
|
|
|
Chromatograph
|
No
|
|
|
|
|
|
|
Continuous Sampler
|
No
|
|
|
|
|
|
|
H2O Dew Point Analyzer
|
No
|
|
|
|
|
|
|
Oxygen Analyzer
|
No
|
|
|
|
|
|
|
H2S Monitor
|
No
|
|
|
|
|
|
|
PRESSURE / FLOW CONTROL
|
|
|
|
|
|
|
|
Primary Pressure Control
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
4” V-200 with 4195 Wizard Controller (existing)
|
Overpressure Device
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
4” V-200 with 4195 Wizard Controller (existing)
|
Station Isolation Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Flow Control Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Heat
|
No
|
|
|
|
|
|
|
Check Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Producer
|
Producer
|
4” ANSI 300
|
ODORIZATION
|
|
|
|
|
|
|
|
Odorizer & Controls
|
No
|
|
|
|
|
|
|
MISCELLANEOUS
|
|
|
|
|
|
|
|
Communication service
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Radio
|
Electrical Service
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Solar & Battery
|
Building – Gas Chromatograph
|
No
|
|
|
|
|
|
|
Building – Odorizer
|
No
|
|
|
|
|
|
|
Fence/Vehicle Barrier/Signage
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Air Permit
|
No
|
|
|
|
|
|
|
STATION EQUIPMENT
|
REQUIRED
|
DESIGN
|
INSTALL
|
OWNERSHIP
|
OPERATE
|
MAINTAIN
|
SPECIAL PROVISIONS/ EQUIPMENT SPECS.
|
PIPING
|
|
|
|
|
|
|
|
Pipeline-Tap & Valve
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
One 8” Tap, Two 12” Taps and Valves ANSI 300
|
Inlet & Station Piping
|
Yes
|
Producer
|
Producer
|
Producer
|
Producer
|
Producer
|
16” Coated Pipe; 20” buried header
|
Outlet & Station Piping
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
16” Coated Pipe; 20” buried header
|
Test Station - inlet piping
|
Yes
|
Producer
|
Producer
|
Producer
|
Producer
|
Producer
|
|
Test Station - outlet piping
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
|
Corrosion coupon
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
|
GAS CONDITIONING
|
|
|
|
|
|
|
|
Filter Separator
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Producer
|
Producer
|
EQT Approved
|
Liquid Level Shutoff
|
No
|
|
|
|
|
|
|
MEASUREMENT
|
|
|
|
|
|
|
|
Meter & Meter Runs
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Two 8-inch, One 6-inch Orifice Meter Runs
|
Meter & Flow Control Risers, Valves, etc…
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
8-inch and 6-inch for above
|
Electronic Measurement & Telecom Hardware
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
3 Eagle /1 RTU w/ Radio
|
GAS QUALITY
|
|
|
|
|
|
|
|
Chromatograph
|
No
|
|
|
|
|
|
|
Continuous Sampler
|
No
|
|
|
|
|
|
|
H2O Dew Point Analyzer
|
No
|
|
|
|
|
|
|
Oxygen Analyzer
|
No
|
|
|
|
|
|
|
H2S Monitor
|
No
|
|
|
|
|
|
|
PRESSURE / FLOW CONTROL
|
|
|
|
|
|
|
|
Primary Pressure Control
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
None if using buckling pin, else Fisher V-200s and 4195 Wizard Controllers
|
Overpressure Device
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Slam-shut buckling pin preferred, or Fisher V-200s and 4195 Wizard Controllers
|
Station Isolation Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Manual Valve
|
Flow Control Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
In lieu of flow control valve, OPP is acceptable
|
Heat
|
No
|
|
|
|
|
|
|
Check Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Producer
|
Producer
|
Two 8-inch, one 6-inch
|
ODORIZATION
|
|
|
|
|
|
|
|
Odorizer & Controls
|
No
|
|
|
|
|
|
|
MISCELLANEOUS
|
|
|
|
|
|
|
|
Communication service
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Radio
|
Electrical Service
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Solar w/Batteries
|
Building - Gas Chromatograph
|
No
|
|
|
|
|
|
|
Building - Odorizer
|
No
|
|
|
|
|
|
|
Fence/Vehicle Barrier/Signage
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Air Permit
|
No
|
|
|
|
|
|
|
Nicoloff 1, 5100057
Nicoloff 2, M5224083
STATION EQUIPMENT
|
REQUIRED
|
DESIGN
|
INSTALL
|
OWNERSHIP
|
OPERATE
|
MAINTAIN
|
SPECIAL PROVISIONS/ EQUIPMENT SPECS.
|
PIPING
|
|
|
|
|
|
|
|
Pipeline-Tap & Valve
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
8” Tap
|
Inlet & Station Piping
|
Yes
|
Producer
|
Producer
|
Producer
|
Producer
|
Producer
|
Existing
|
Outlet & Station Piping
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Existing
|
Test Station - inlet piping
|
Yes
|
Producer
|
Producer
|
Producer
|
Producer
|
Producer
|
|
Test Station - outlet piping
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
|
Corrosion coupon
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
|
GAS CONDITIONING
|
|
|
|
|
|
|
|
Filter Separator
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Producer
|
Producer
|
Shawndra Filter plus EQT Approved Peco Cyclotube
|
Liquid Level Shutoff
|
No
|
|
|
|
|
|
16” Barrel
|
MEASUREMENT
|
|
|
|
|
|
|
|
Meter & Meter Runs
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Existing 6” orifice plus 8” orifice
|
Meter & Flow Control Risers, Valves, etc…
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Existing 6” valves plus 8” valves
|
Electronic Measurement & Telecom Hardware
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Eagle/1 RTU (for each meter)
|
GAS QUALITY
|
|
|
|
|
|
|
|
Chromatograph
|
No
|
|
|
|
|
|
|
Continuous Sampler
|
No
|
|
|
|
|
|
|
H2O Dew Point Analyzer
|
No
|
|
|
|
|
|
|
Oxygen Analyzer
|
No
|
|
|
|
|
|
|
H2S Monitor
|
No
|
|
|
|
|
|
|
PRESSURE / FLOW CONTROL
|
|
|
|
|
|
|
|
Primary Pressure Control
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Primary and Monitor control valves are req'd UNLESS a Rupture Pin Valve is installed. Existing 4” CV/OPP
|
Overpressure Device
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Rupture Pin Valve or Primary and Monitor Control Valve, Existing 4” OPP
|
Station Isolation Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Manual valve at header
|
Flow Control Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Heat
|
No
|
|
|
|
|
|
|
Check Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Producer
|
Producer
|
6” and 8”
|
ODORIZATION
|
|
|
|
|
|
|
|
Odorizer & Controls
|
No
|
|
|
|
|
|
|
MISCELLANEOUS
|
|
|
|
|
|
|
|
Communication service
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Radio or Cell
|
Electrical Service
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Solar & Battery
|
Building - Gas Chromatograph
|
No
|
|
|
|
|
|
|
Building - Odorizer
|
No
|
|
|
|
|
|
|
Fence/Vehicle Barrier/Signage
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Air Permit
|
No
|
|
|
|
|
|
|
Alpha 1, M5224627
Alpha 2, M5224714
STATION EQUIPMENT
|
REQUIRED
|
DESIGN
|
INSTALL
|
OWNERSHIP
|
OPERATE
|
MAINTAIN
|
SPECIAL PROVISIONS/ EQUIPMENT SPECS.
|
PIPING
|
|
|
|
|
|
|
|
Pipeline-Tap & Valve
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
10” hot tap
|
Inlet & Station Piping
|
Yes
|
Producer
|
Producer
|
Producer
|
Producer
|
Producer
|
10” minimum
|
Outlet & Station Piping
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
10” minimum
|
Test Station - inlet piping
|
Yes
|
Producer
|
Producer
|
Producer
|
Producer
|
Producer
|
|
Test Station - outlet piping
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
|
Corrosion coupon
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
|
GAS CONDITIONING
|
|
|
|
|
|
|
|
Filter Separator
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Producer
|
Producer
|
EQT Approved Peco Cyclotube
|
Liquid Level Shutoff
|
No
|
|
|
|
|
|
|
MEASUREMENT
|
|
|
|
|
|
|
|
Meter & Meter Runs
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Two 8” orifice
|
Meter & Flow Control Risers, Valves, etc…
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Valves for 8” meter skid
|
Electronic Measurement & Telecom Hardware
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Eagle/1 RTU (for each meter)
|
GAS QUALITY
|
|
|
|
|
|
|
|
Chromatograph
|
No
|
|
|
|
|
|
|
Continuous Sampler
|
No
|
|
|
|
|
|
|
H2O Dew Point Analyzer
|
No
|
|
|
|
|
|
|
Oxygen Analyzer
|
No
|
|
|
|
|
|
|
H2S Monitor
|
No
|
|
|
|
|
|
|
PRESSURE / FLOW CONTROL
|
|
|
|
|
|
|
|
Primary Pressure Control
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Primary and Monitor control valves are req'd UNLESS a Rupture Pin Valve is installed
|
Overpressure Device
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Rupture Pin Valve or Primary and Monitor Control Valve
|
Station Isolation Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Manual valve at header
|
Flow Control Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
In lieu of flow control valve, OPP is acceptable
|
Heat
|
No
|
|
|
|
|
|
|
Check Valve
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Producer
|
Producer
|
For each 8” meter skid
|
ODORIZATION
|
|
|
|
|
|
|
|
Odorizer & Controls
|
No
|
|
|
|
|
|
|
MISCELLANEOUS
|
|
|
|
|
|
|
|
Communication service
|
Yes
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Gatherer
|
Cell Modem
|
Electrical Service
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
Solar & Battery
|
Building - Gas Chromatograph
|
No
|
|
|
|
|
|
|
Building - Odorizer
|
No
|
|
|
|
|
|
|
Fence/Vehicle Barrier/Signage
|
Yes
|
Gatherer
|
Producer
|
Producer
|
Gatherer
|
Producer
|
|
Air Permit
|
No
|
|
|
|
|
|
|
a.
|
Exhibit A
attached to the Agreement is hereby amended to add the following Delivery Points:
|
b.
|
Exhibit A
attached to the Agreement is hereby further amended to reflect the following modified Contract MDQ and Compression MDQ:
|
c.
|
The table set forth in Section 1.a of
Exhibit B-1
attached to the Agreement is hereby deleted in its entirety and replaced with the following revised table:
|
|
Contract MDQ
|
Reservation Fee
|
In-Service Date
|
Term
|
|
|
|
|
|
Initial Contract MDQ
|
[***]
|
[***]
|
[***]
|
[***]
|
Callisto
|
[***]
|
[***]
|
[***]
|
[***]
|
Jupiter
|
[***]
|
[***]
|
[***]
|
[***]
|
Halo
|
[***]
|
[***]
|
[***]
|
[***]
|
Europa
|
[***]
|
[***]
|
[***]
|
[***]
|
Io
|
[***]
|
[***]
|
[***]
|
[***]
|
EQT PRODUCTION COMPANY
|
EQM GATHERING OPCO, LLC
|
By:
/s/ David Schlosser
|
By:
/s/ Andrew L. Murphy
|
Name:
David Schlosser
|
Name:
Andrew L. Murphy
|
Title:
EVP Production
|
Title:
Vice President
|
EQT ENERGY, LLC
|
|
By:
/s/ Donald Jenkins
|
|
Name:
Donald Jenkins
|
|
Title:
EVP Commercial
|
|
a.
|
Exhibit A-1
attached to the Agreement is hereby deleted in its entirety and replaced with revised
Exhibit A-1
, a copy of which is attached hereto.
|
b.
|
The table set forth in Section III(A)(1) of
Exhibit F
attached to the Agreement is hereby deleted in its entirety and replaced with the table attached hereto as
Exhibit F
.
|
EQT PRODUCTION COMPANY
|
EQM GATHERING OPCO, LLC
|
By:
/s/ David Schlosser
|
By:
/s/ Andrew L. Murphy
|
Name:
David Schlosser
|
Name:
Andrew L. Murphy
|
Title:
EVP Production
|
Title:
Vice President
|
EQT ENERGY, LLC
|
|
By:
/s/ Donald Jenkins
|
|
Name:
Donald Jenkins
|
|
Title:
EVP Commercial
|
|
System
|
Receipt Point Meter ID
|
Receipt Point Meter Name
|
Receipt Point MDQ
Mcf / Day |
|
Mercury
|
5100016
|
Big 176 Gathering MM A Run
|
68,600
|
|
Mercury
|
5100042
|
Big 333/192 MM A Run
|
117,300
|
|
Mercury
|
5100045
|
PNG 129 Gathering MM A Run
|
117,300
|
|
Mercury
|
5100069
|
PNG 103 MM A RUN UPGRADE
|
117,300
|
|
Mercury
|
5100070
|
PNG 103 MM B RUN UPGRADE
|
68,600
|
|
Mercury
|
5100115
|
Big 7 MM
|
68,600
|
|
Mercury
|
M5208892
|
Big 333/192 B Run
|
68,600
|
|
Mercury
|
M5223136
|
BIG 176 Gathering MM B Run
|
117,300
|
|
Mercury
|
M5223466
|
PNG 129 Gathering MM B Run
|
117,300
|
|
Pandora
|
M5214491
|
CPT 11 MM
|
68,600
|
|
Pandora
|
M5214966
|
SMI 27 Gathering MM
|
117,300
|
|
Pluto
|
24491
|
RSM16
|
68,600
|
|
Pluto
|
24582
|
RSM110/112 Gathering Meter
|
68,600
|
|
Pluto
|
24595
|
RSM 118 Gathering MM
|
68,600
|
|
Pluto
|
24596
|
RSM 119 Gathering MM
|
68,600
|
|
Pluto
|
M5219740
|
RSM110/112 Gathering Meter
|
68,600
|
|
Saturn
|
24454
|
OXF 114, 115
|
19,600
|
|
Saturn
|
24455
|
OXF 121
|
19,600
|
|
Saturn
|
24456
|
OXF 43 and 44 MM
|
45,900
|
|
Saturn
|
24470
|
OXF 149/150/156 MM A Run
|
45,900
|
|
Saturn
|
24471
|
OXF 138 Interconnect
|
45,900
|
|
Saturn
|
24472
|
OXF 127 Interconnect
|
45,900
|
|
Saturn
|
24481
|
OX131/152/153Gathering MM
|
45,900
|
|
Saturn
|
24492
|
WEU 1&2 B Gathering Meter
|
45,900
|
|
Saturn
|
24556
|
OXF 16 MM
|
19,600
|
|
Saturn
|
24625
|
OXF 131/152/153 Gathering B Run
|
45,900
|
|
Saturn
|
5100020
|
PEN 15 Master Meter A Run
|
45,900
|
|
Saturn
|
5100048
|
PEN15 MM B RUN
|
45,900
|
|
Saturn
|
5100059
|
SMI 28 MM A Run
|
78,500
|
|
Saturn
|
5100061
|
SMI 28 MM B Run
|
45,900
|
|
Saturn
|
M5212896
|
WEU-8 Gathering MM
|
78,500
|
|
Saturn
|
M5214202
|
WEU 51 MM
|
78,500
|
|
Saturn
|
M5214970
|
WEU 6 Gathering MM A Run
|
45,900
|
|
Saturn
|
M5222001
|
OXF 149/150/156MM B Run
|
45,900
|
|
Saturn
|
M5223803
|
OXF 157-159 Gathering MM A Run
|
45,900
|
|
Saturn
|
M5223804
|
OXF 157-159 Gathering MM B Run
|
45,900
|
|
Saturn
|
M5225932
|
WEU 6 MM B Run
|
45,900
|
|
Saturn
|
M5228452
|
WEU 1-2-49 MM
|
45,900
|
System
|
Delivery Point Meter ID
|
Delivery Point Meter Name
|
|
Mercury
|
5100025
|
MarkWest Mobley 2 (High pressure)
|
|
Mercury
|
M5202956
|
Mercury to MarkWest B Run (High pressure)
|
|
Mercury
|
M5209276
|
Mercury to MW - 16" run 1 (Low pressure)
|
|
Mercury
|
M5209277
|
Mercury to MW - 16" run 2 (Low pressure)
|
|
Mercury
|
5100017
|
Mercury to 302 (Mobley bypass)
|
|
Mercury
|
M5224080
|
Mercury to H-515 (Mobley bypass)
|
|
Pluto
|
24490
|
Pluto to GSF-604
|
|
Saturn
|
24452
|
Pierce North to Equitrans Gathering
|
|
Saturn
|
24453
|
Leeson South to Equitrans Gathering
|
|
Saturn
|
24484
|
Saturn Discharge to WG100
|
|
Saturn
|
M5229563
|
Saturn Units 6 & 7 Discharge to WG100
|
System
|
Delivery Point Meter ID
|
Delivery Point Meter Name
|
|
Mercury
|
5100093
|
MarkWest Mobley (Logansport, West Virginia)
|
|
Saturn
|
M5206528
|
NGLs from Saturn to WG100
|
|
Saturn
|
M5229478
|
Saturn CS Liquids to WG100
|
System
|
Meter ID
|
Meter Name
|
GPS Coordinates
|
MAOP
|
Min DQ
Mcf/Day |
Max DQ
Mcf/Day |
||
Mercury
|
5100016
|
Big 176 Gathering MM A Run
|
-80.55179
|
39.55602
|
1,440
|
1,900
|
68,600
|
|
Mercury
|
5100042
|
Big 333/192 MM A Run
|
-80.58099
|
39.52385
|
1,440
|
3,200
|
117,300
|
|
Mercury
|
5100045
|
PNG 129 Gathering MM A Run
|
-80.64344
|
39.55349
|
1,440
|
3,200
|
117,300
|
|
Mercury
|
5100069
|
PNG 103 MM A RUN UPGRADE
|
-80.62447
|
39.56334
|
1,440
|
3,200
|
117,300
|
|
Mercury
|
5100070
|
PNG 103 MM B RUN UPGRADE
|
-80.62447
|
39.56334
|
1,440
|
1,900
|
68,600
|
|
Mercury
|
5100115
|
Big 7 MM
|
-80.61385
|
39.57679
|
1,440
|
1,900
|
68,600
|
|
Mercury
|
M5208892
|
Big 333/192 B Run
|
-80.58099
|
39.52385
|
1,440
|
1,900
|
68,600
|
|
Mercury
|
M5223136
|
BIG 176 Gathering MM B Run
|
-80.55179
|
39.55602
|
1,440
|
3,200
|
117,300
|
|
Mercury
|
M5223466
|
PNG 129 Gathering MM B Run
|
-80.64344
|
39.55349
|
1,440
|
3,200
|
117,300
|
|
Pandora
|
M5214491
|
CPT 11 MM
|
-80.72431
|
39.38134
|
1,440
|
1,900
|
68,600
|
|
Pandora
|
M5214966
|
SMI 27 Gathering MM
|
-80.7027132
|
39.3813596
|
1,440
|
3,200
|
117,300
|
|
Pluto
|
24491
|
RSM16
|
-80.14147
|
39.32203
|
1,440
|
1,900
|
68,600
|
|
Pluto
|
24582
|
RSM110/112 Gathering Meter
|
-80.16256
|
39.31757
|
1,440
|
1,900
|
68,600
|
|
Pluto
|
24595
|
RSM 118 Gathering MM
|
-80.18918
|
39.29457
|
1,440
|
1,900
|
68,600
|
|
Pluto
|
24596
|
RSM 119 Gathering MM
|
-80.15786
|
39.29579
|
1,440
|
1,900
|
68,600
|
|
Pluto
|
M5219740
|
RSM110/112 Gathering Meter
|
-80.16256
|
39.31757
|
1,440
|
1,900
|
68,600
|
|
Saturn
|
24454
|
OXF 114, 115
|
-80.80857
|
39.14277
|
720
|
600
|
19,600
|
|
Saturn
|
24455
|
OXF 121
|
-80.8068
|
39.1359
|
720
|
600
|
19,600
|
|
Saturn
|
24456
|
OXF 43 and 44 MM
|
-80.81166
|
39.14533
|
720
|
1,200
|
45,900
|
|
Saturn
|
24470
|
OXF 149/150/156 MM A Run
|
-80.78491
|
39.21018
|
720
|
1,200
|
45,900
|
|
Saturn
|
24471
|
OXF 138 Interconnect
|
-80.78468
|
39.20905
|
720
|
1,200
|
45,900
|
|
Saturn
|
24472
|
OXF 127 Interconnect
|
-80.80583
|
39.19561
|
720
|
1,200
|
45,900
|
|
Saturn
|
24481
|
OX131/152/153Gathering MM
|
-80.79538
|
39.18596
|
720
|
1,200
|
45,900
|
|
Saturn
|
24492
|
WEU 1&2 B Gathering Meter
|
-80.7872
|
39.2635
|
720
|
1,200
|
45,900
|
|
Saturn
|
24556
|
OXF 16 MM
|
-80.77924
|
39.18906
|
720
|
600
|
19,600
|
|
Saturn
|
24625
|
OXF 131/152/153 Gathering B Run
|
-80.7952
|
39.18556
|
720
|
1,200
|
45,900
|
|
Saturn
|
5100020
|
PEN 15 Master Meter A Run
|
-80.936507
|
39.2502322
|
720
|
1,200
|
45,900
|
|
Saturn
|
5100048
|
PEN15 MM B RUN
|
-80.936507
|
39.2502322
|
720
|
1,200
|
45,900
|
|
Saturn
|
5100059
|
SMI 28 MM A Run
|
-80.74666
|
39.25743
|
720
|
2,100
|
78,500
|
|
Saturn
|
5100061
|
SMI 28 MM B Run
|
-80.74666
|
39.25743
|
720
|
1,200
|
45,900
|
|
Saturn
|
M5212896
|
WEU-8 Gathering MM
|
-80.80077
|
39.27448
|
720
|
2,100
|
78,500
|
|
Saturn
|
M5214202
|
WEU 51 MM
|
-80.76367
|
39.25619
|
720
|
2,100
|
78,500
|
|
Saturn
|
M5214970
|
WEU 6 Gathering MM A Run
|
-80.75645
|
39.29037
|
720
|
1,200
|
45,900
|
|
Saturn
|
M5222001
|
OXF 149/150/156MM B Run
|
-80.78491
|
39.21018
|
720
|
1,200
|
45,900
|
|
Saturn
|
M5223803
|
OXF 157-159 Gathering MM A Run
|
-80.76716
|
39.21132
|
720
|
1,200
|
45,900
|
|
Saturn
|
M5223804
|
OXF 157-159 Gathering MM B Run
|
-80.76716
|
39.21132
|
720
|
1,200
|
45,900
|
|
Saturn
|
M5225932
|
WEU 6 MM B Run
|
-80.75645
|
39.29037
|
720
|
1,200
|
45,900
|
|
Saturn
|
M5228452
|
WEU 1-2-49 MM
|
-80.7872
|
39.2635
|
720
|
1,200
|
45,900
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
|
(Thousands)
|
|||||||||||||||||||
Earnings
:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income before income taxes
|
|
$
|
400,153
|
|
|
$
|
298,205
|
|
|
$
|
244,364
|
|
|
$
|
155,884
|
|
|
$
|
99,834
|
|
Minus: equity income of unconsolidated entities
|
|
(2,367
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Plus: Fixed charges
|
|
51,041
|
|
|
33,242
|
|
|
2,530
|
|
|
5,226
|
|
|
6,248
|
|
|||||
Minus: Capitalized interest
|
|
(4,546
|
)
|
|
(1,886
|
)
|
|
(442
|
)
|
|
(1,858
|
)
|
|
(758
|
)
|
|||||
Total earnings
|
|
$
|
444,281
|
|
|
$
|
329,561
|
|
|
$
|
246,452
|
|
|
$
|
159,252
|
|
|
$
|
105,324
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed charges:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, excluding capital lease interest expense
|
|
$
|
22,436
|
|
|
$
|
10,968
|
|
|
$
|
829
|
|
|
$
|
2,944
|
|
|
$
|
5,050
|
|
Interest expense, capital lease
|
|
23,225
|
|
|
19,888
|
|
|
843
|
|
|
—
|
|
|
—
|
|
|||||
Plus: Capitalized interest
|
|
4,546
|
|
|
1,886
|
|
|
442
|
|
|
1,858
|
|
|
758
|
|
|||||
Plus: Estimated interest component of rental expense
|
|
834
|
|
|
500
|
|
|
416
|
|
|
424
|
|
|
440
|
|
|||||
Total fixed charges
|
|
$
|
51,041
|
|
|
$
|
33,242
|
|
|
$
|
2,530
|
|
|
$
|
5,226
|
|
|
$
|
6,248
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Ratio of earnings to fixed charges
|
|
8.7x
|
|
|
9.9x
|
|
|
97.4x
|
|
|
30.5x
|
|
|
16.9x
|
|
(1)
|
Earnings included in the calculation of this ratio consist of (i) income before income taxes, minus (ii) equity income of unconsolidated entities, plus (iii) fixed charges and minus (iv) capitalized interest (including allowance for borrowed funds used during construction). Fixed charges included in the calculation of this ratio consist of (i) interest expense, plus (ii) capitalized interest (including allowance for borrowed funds used during construction) and (iii) the estimated interest portion of rental expense.
|
Company
|
|
Jurisdiction of Organization
|
Equitrans Investments, LLC
|
|
Delaware
|
Equitrans Services, LLC
|
|
Delaware
|
Equitrans, L.P.
|
|
Pennsylvania
|
EQT Midstream Finance Corporation
|
|
Delaware
|
EQM Gathering Holdings, LLC
|
|
Delaware
|
EQM Gathering Opco, LLC
|
|
Delaware
|
MVP Holdco, LLC
|
|
Delaware
|
•
|
Registration Statement (Form S-3 No. 333-189719) of EQT Midstream Partners, LP and EQT Midstream Finance Corporation pertaining to the registration of Common Units Representing Limited Partner Interests, Debt Securities and Guarantees of Debt Securities;
|
•
|
Registration Statement (Form S-3 No. 333-205812) of EQT Midstream Partners, LP pertaining to the registration of Common Units Representing Limited Partner Interests; and
|
•
|
Registration Statement (Form S-8 No. 333-182460) pertaining to the EQT Midstream Services, LLC 2012 Long-Term Incentive Plan;
|
Date:
|
February 11, 2016
|
|
|
|
EQT Midstream Partners, LP
|
|
|
|
|
|
/s/ David L. Porges
|
|
|
David L. Porges
|
|
|
President and Chief Executive Officer, EQT Midstream Services, LLC, the registrant’s General Partner
|
Date:
|
February 11, 2016
|
|
|
|
EQT Midstream Partners, LP
|
|
|
|
|
|
/s/ Philip P. Conti
|
|
|
Philip P. Conti
|
|
|
Senior Vice President and Chief Financial Officer, EQT Midstream Services, LLC, the registrant’s General Partner
|
/s/ David L. Porges
|
|
|
February 11, 2016
|
David L. Porges
|
|
|
|
President and Chief Executive Officer, EQT Midstream Services, LLC, the Partnership’s General Partner
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
/s/ Philip P. Conti
|
|
|
February 11, 2016
|
Philip P. Conti
|
|
|
|
Senior Vice President and Chief Financial Officer, EQT Midstream Services, LLC, the Partnership’s General Partner
|
|
|
NAMED EXECUTIVE OFFICER COMPENSATION 2016 PEER COMPANIES
|
||
(GENERAL INDUSTRY)
|
||
|
|
|
A.O. Smith
|
Cloud Peak Energy
|
Harsco
|
Aaron's
|
Columbia Sportswear
|
Herman Miller
|
Acuity Brands
|
Convergys
|
Hexcel
|
Advanced Drainage Systems
|
Cooper Standard Automotive
|
HNI
|
Alexion Pharmaceuticals
|
Covance
|
HNTB
|
Allegion
|
Cubic
|
Houghton Mifflin Harcourt Publishing
|
American Crystal Sugar
|
Curtiss-Wright
|
Husky Injection Molding Systems*
|
Americas Styrenics
|
Cytec Industries
|
ICF International
|
Ansell
|
Day & Zimmermann
|
IDEX Corporation
|
Arby's Restaurant Group
|
Deluxe
|
IDEXX Laboratories
|
Arcadis*
|
Dematic Corporation*
|
IMS Health
|
Armstrong World Industries
|
Dentsply
|
Intelsat
|
Arup USA*
|
Donaldson
|
Intercontinental Hotels Group*
|
Avintiv
|
DST Systems
|
International Flavors & Fragrances
|
Blount International
|
E.W. Scripps
|
International Game Technology
|
BMC Software
|
Eastman Kodak
|
Irvine
|
Bob Evans Farms
|
Edwards Lifesciences
|
ITT Corporation
|
Brady
|
Endo
|
Jack in the Box
|
Brembo*
|
Equifax
|
K. Hovnanian Companies
|
Brickman Group
|
Equity Office Properties
|
Kate Spade & Company
|
Broadridge Financial Solutions
|
ESCO
|
KB Home
|
C.R. Bard
|
Esterline Technologies
|
Kennametal
|
Capsugel
|
FOCUS Brands
|
Keysight Technologies
|
Carmeuse North America Group*
|
G&K Services
|
Lincoln Electric
|
Carpenter Technology
|
GAF Materials
|
LinkedIn
|
Catalent Pharma Solutions
|
General Atomics
|
Magellan Midstream Partners
|
CDK Global
|
Graco
|
Martin Marietta Materials
|
Chemtura
|
Granite Construction
|
Matthews International
|
Children's Place
|
H.B. Fuller
|
Navigant Consulting
|
Clearwater Paper Corporation
|
Halyard Health
|
NBTY
|
Nortek
|
Select Comfort
|
Tupperware Brands
|
Nu Skin Enterprises
|
ServiceMaster Company
|
UBM*
|
Nuance Communications
|
Sigma-Aldrich
|
Underwriters Laboratories
|
Outerwall
|
Solenis
|
Unisys
|
PAREXEL
|
Spirit Airlines
|
United Launch Alliance
|
Parsons
|
Steelcase
|
Vectrus
|
Plexus
|
SunCoke Energy
|
Ventura Foods
|
Rackspace
|
SunGard Data Systems
|
Verint Systems
|
Rayonier Advanced Materials
|
TeleTech
|
Vesuvius*
|
Recreational Equipment
|
Tempur Sealy
|
Vulcan Materials
|
Regal-Beloit
|
Teradata
|
Walter Energy
|
Revlon
|
Timken
|
Wendy's Group
|
Rowan Companies
|
TimkenSteel
|
West Pharmaceutical Services
|
SAS Institute
|
Toro
|
WhiteWave Foods
|
Scholastic
|
Total System Services (TSYS)
|
Wilsonart
|
Schwan Food Company
|
Tribune Media
|
YP
|
Scotts Miracle-Gro
|
Tribune Publishing
|
|
Scripps Networks Interactive
|
Tronox
|
|
|
|
|
* Subsidiary
|
|
|
|
|
|
Source: Towers Watson 2015 CDB General Industry Executive Compensation Survey Report - U.S. (Companies with global revenues from $1 to $3 billion)
|