Blackstone Credit, EQT Form $3.5B Natural Gas Pipeline JV

EQT Corp. has announced a $3.5 billion midstream joint venture with Blackstone Credit & Insurance (BXCI) for some of its natural gas pipelines. The JV includes EQT’s ownership of the 300-mile Mountain Valley Pipeline, FERC-regulated transmission and storage assets, and the Hammerhead Pipeline, for a total value of around $8.8 billion.

EQT will retain rights to growth projects, while BXCI will receive a non-controlling equity interest. EQT anticipates that it will exit 2024 with approximately $9 billion of net debt, and the proceeds will be allocated to debt reduction. This, in conjunction with recent divestitures, results in total cash proceeds of $5.25 billion, surpassing the $3 billion to $5 billion asset sale target.

“These critical midstream assets benefit from strong tailwinds as demand for energy, particularly natural gas, continues to grow,” said Rick Campbell, managing director at BXCI. “Blackstone’s scale and expertise in this high conviction sector allowed us to create what we believe is a compelling opportunity for both EQT and our investors.”

In the third quarter, BXCI’s inflows increased by 22% to $21.4 billion, establishing it as the company’s largest business line with $355 billion in assets under management as of September 30.

RBC Capital Markets, LLC acted as financial advisor to EQT. Kirkland & Ellis LLP is serving as EQT’s legal counsel on the transaction. Citi acted as financial advisor to Blackstone. Milbank LLC is serving as Blackstone’s legal counsel on the transaction.