(Bloomberg) -- EQT Corp., the largest US natural gas producer, is in advanced talks to acquire THQ Appalachia I LLC to expand in the Marcellus shale, according to people with knowledge of the matter.
THQ, backed by Tug Hill Operating and Quantum Energy Partners, and some midstream assets would be valued in the deal at about $5.2 billion, the people said, asking not to be identified discussing private information. The transaction will include Tug Hill's XcL Midstream, a pipeline firm that moves gas in Appalachia to market.
An announcement could come as soon as Tuesday, the people said. A final agreement hasn't been reached and talks could still end without one, the people said.
A spokesperson for EQT declined to comment. Representatives for Tug Hill, Quantum and XcL didn't immediately respond to requests for comment.
EQT, led by Chief Executive Officer Toby Rice, has been expanding in recent years via a series of acquisitions to consolidate holdings across the Marcellus in the northeast US. EQT last year acquired assets from Alta Resources Development LLC for about $2.9 billion. It bought Chevron Corp.'s assets in Appalachia for $735 million in 2020.
THQ is an exploration and production company operating in West Virginia, according to its website.
Private equity firm Quantum Energy invested in Fort Worth, Texas-based Tug Hill in 2014. It also has an equity commitment in THQ Appalachia which is operated by Tug Hill.
EQT fell 3.9% to $45.45 at 8:22 a.m. in pre-market trading in New York. Still, shares of Pittsburgh-based EQT have more than doubled this year amid the global energy crisis that has pushed up prices.
(Updates with share price in last paragraph)
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