Headline: Blackstone Nearing $3.5 Billion Pipeline Deal with EQT

Private equity firm Blackstone is nearing a deal to purchase minority stakes in EQT Corp's interstate natural gas pipelines for approximately $3.5 billion. The acquisition discussions are in advanced stages, and barring any setbacks, a deal could potentially be finalized in the coming weeks. This transaction will allow EQT to significantly reduce its debt stemming from its earlier acquisition of pipeline operator Equitrans Midstream. Blackstone aims to make the investment through its recently restructured combined credit and insurance division. This move is intended to provide the firm with stable revenue streams and increase its exposure to energy infrastructure assets.

A key asset in the deal is EQT's stake in the Mountain Valley Pipeline, a 300-mile natural gas line running from West Virginia to Virginia, which entered service in June after overcoming extensive legal challenges. Pittsburgh-based EQT holds stakes in interstate pipelines with a transport capacity of 4.4 billion cubic feet of natural gas per day, spanning 940 miles. In a presentation in March, the company reported that these assets had adjusted earnings before interest, taxes, depreciation, and amortization of approximately $700 million as of July.

The sale of these pipeline stakes is part of EQT's strategy to reduce its roughly $14 billion debt by $5 billion using cash from operations and asset sales. The company previously announced asset sales totaling $1.1 billion to Equinor and revealed plans to sell minority stakes in its pipelines. Blackstone, managing over $1 trillion in assets, boasts a broad portfolio including pipeline operator Tallgrass Energy and a stake in the Elba Island LNG facility. The firm's restructuring of its credit and insurance operations into a single unit in September 2023 was part of a strategic effort to enhance returns and asset value.

Representatives from EQT and Blackstone did not comment on the ongoing discussions.