Bond EQM Midstream LLC 6.5% ( US26885BAE02 ) in USD

EQM Midstream LLC

92.53 % ⇌

United States

US26885BAE02 ( in USD )

6.5% per year ( payment 2 times a year)

14/07/2048 ( The next call date is 15/01/2048 )

Prospectus brochure of the bond EQM Midstream Partners L.P US26885BAE02 en USD 6.5%, maturity 14/07/2048

2 000 USD

550 000 000 USD

26885BAE0

BBB- ( Lower medium grade - Investment-grade )

Ba2 ( Non-investment grade speculative )

15/07/2025 ( Today )

EQM Midstream Partners, L.P. is a publicly traded master limited partnership (MLP) engaged in the gathering, processing, and transportation of natural gas and natural gas liquids (NGLs) primarily in the Appalachian Basin and other regions of the United States.

The Bond issued by EQM Midstream LLC ( United States ) , in USD, with the ISIN code US26885BAE02, pays a coupon of 6.5% per year.
The coupons are paid 2 times per year and the Bond maturity is 14/07/2048

The Bond issued by EQM Midstream LLC ( United States ) , in USD, with the ISIN code US26885BAE02, was rated Ba2 ( Non-investment grade speculative ) by Moody's credit rating agency.

The Bond issued by EQM Midstream LLC ( United States ) , in USD, with the ISIN code US26885BAE02, was rated BBB- ( Lower medium grade - Investment-grade ) by Standard & Poor's ( S&P ) credit rating agency.

424B2 1 a2236102z424b2.htm 424B2
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TABLE OF CONTENTS
TABLE OF CONTENTS 2
Table of Contents
CALCU LAT I ON OF REGI ST RAT I ON FEE

Propose d
M a x im um
Propose d
T it le of Ea c h Cla ss of
Aggre ga t e
M a x im um
Am ount of
Se c urit ie s
Am ount t o be
Offe ring Pric e
Aggre ga t e
Re gist ra t ion
t o be Re gist e re d

Re gist e re d

Pe r U nit
Offe ring Pric e

Fe e s (1 )

4.750% Senior Notes due 2023 $1,100,000,000
99.761%
$1,097,371,000 $136,622.69

5.500% Senior Notes due 2028
$850,000,000
99.538%

$846,073,000 $105,336.09

6.500% Senior Notes due 2048
$550,000,000
99.055%

$544,802,500
$67,827.92

$2,500,000,000

$2,488,246,500 $309,786.70

(1)
The registration fee, calculated in accordance with Rule 457(r), has been transmitted to the Securities and Exchange Commission in
connection with the securities offered from Registration Statement File No. 333-212362 by means of this prospectus supplement.
Table of Contents
File d Pursua nt t o Rule 4 2 4 (b)(2 )
Re gist ra t ion St a t e m e nt N o. 3 3 3 -2 1 2 3 6 2
P R O S P E C T U S S U P P L E M E N T
(T o prospe c t us da t e d J une 3 0 , 2 0 1 6 )
$ 2 ,5 0 0 ,0 0 0 ,0 0 0
EQT M idst re a m Pa rt ne rs, LP
$ 1 ,1 0 0 ,0 0 0 ,0 0 0 4 .7 5 0 % Se nior N ot e s due 2 0 2 3
$ 8 5 0 ,0 0 0 ,0 0 0 5 .5 0 0 % Se nior N ot e s due 2 0 2 8
$ 5 5 0 ,0 0 0 ,0 0 0 6 .5 0 0 % Se nior N ot e s due 2 0 4 8
We are offering $2,500,000,000 aggregate principal amount of Senior Notes, consisting of $1,100,000,000 aggregate principal amount
of 4.750% Senior Notes due 2023 (the 2023 notes), $850,000,000 aggregate principal amount of 5.500% Senior Notes due 2028 (the 2028
Notes), and $550,000,000 aggregate principal amount of 6.500% Senior Notes due 2048 (the 2048 Notes and, together with the 2023 Notes
and the 2028 Notes, the Notes). The 2023 Notes will mature on July 15, 2023, the 2028 Notes will mature on July 15, 2028 and the 2048
Notes will mature on July 15, 2048. Interest on the Notes will be paid semi-annually in arrears on January 15 and July 15 in each year,
commencing on January 15, 2019.
We may, at our option, redeem any series of the Notes at any time in whole or from time to time in part, prior to maturity, at the
redemption prices as described herein under "Description of Notes--Optional Redemption."
The Notes will be our senior unsecured indebtedness ranking equally in right of payment with all of our existing and future senior
indebtedness; senior in right of payment to any of our future subordinated indebtedness; effectively junior in right of payment to any of our
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secured indebtedness, to the extent of the value of the assets securing such indebtedness; and structurally subordinated to all existing and
future obligations, including trade payables, of our subsidiaries, other than any subsidiaries that may guarantee the Notes in the future.
The Notes are new issues of securities with no established trading market. We do not currently intend to apply for listing of the Notes
on any securities exchange or have the Notes quoted on any automated quotation system.
I nve st ing in t he N ot e s involve s risk s t ha t a re de sc ribe d in t he "Risk Fa c t ors" se c t ion t ha t be gins on pa ge S -1 5
of t his prospe c t us supple m e nt a nd pa ge 3 of t he a c c om pa nying ba se prospe c t us.

2 0 2 3 N ot e s

2 0 2 8 N ot e s

2 0 4 8 N ot e s

Pe r
Pe r
Pe r

N ot e

T ot a l

N ot e

T ot a l

N ot e

T ot a l

Initial price to public
(1)

99.761% $ 1,097,371,000
99.538% $ 846,073,000
99.055% $ 544,802,500
Underwriting
discount

0.600% $
6,600,000

0.650% $
5,525,000

0.875% $
4,812,500
Proceeds, before
expenses, to us

99.161% $ 1,090,771,000
98.888% $ 840,548,000
98.180% $ 539,990,000
(1)
Plus accrued interest, if any, from June 25, 2018 if settlement occurs after that date.
N e it he r t he Se c urit ie s a nd Ex c ha nge Com m ission nor a ny st a t e se c urit ie s c om m ission ha s a pprove d or
disa pprove d of t he se se c urit ie s or de t e rm ine d if t his prospe c t us supple m e nt or t he a c c om pa nying ba se prospe c t us
is t rut hful or c om ple t e . Any re pre se nt a t ion t o t he c ont ra ry is a c rim ina l offe nse .
We expect that delivery of the Notes will be made to investors in registered book entry form only through the facilities of The
Depository Trust Company on or about June 25, 2018.
Joint Book-Running Managers
BofA M e rrill Lync h

We lls Fa rgo Se c urit ie s

De ut sc he Ba nk Se c urit ie s

PN C Ca pit a l M a rk e t s LLC
Cre dit Suisse

J .P. M orga n

M U FG

RBC Ca pit a l M a rk e t s
Sc ot ia ba nk

T D Se c urit ie s

U S Ba nc orp
Co-Managers
SM BC N ik k o
Cit ize ns Ca pit a l M a rk e t s
H unt ingt on Ca pit a l M a rk e t s
CI BC Ca pit a l M a rk e t s
The date of this prospectus supplement is June 20, 2018
Table of Contents
T ABLE OF CON T EN T S
Prospe c t us Supple m e nt
INFORMATION IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS
S-ii
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
S-iii
SUMMARY
S-1
RISK FACTORS
S-15
USE OF PROCEEDS
S-21
RATIO OF EARNINGS TO FIXED CHARGES
S-22
CAPITALIZATION
S-23
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
S-25
DESCRIPTION OF OTHER INDEBTEDNESS
S-35
DESCRIPTION OF NOTES
S-38
MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS
S-57
UNDERWRITING
S-63
LEGAL MATTERS
S-68
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EXPERTS
S-68
WHERE YOU CAN FIND MORE INFORMATION
S-68
Prospe c t us

Pa ge
About This Prospectus

1
EQT Midstream Partners, LP

2
Risk Factors

3
Forward-Looking Statements

4
Use of Proceeds

6
Ratio of Earnings to Fixed Charges

7
Description of the Debt Securities

8
Description of the Common Units

16
Description of Our Partnership Agreement

18
Cash Distribution Policy

31
Material Income Tax Considerations

41
Plan of Distribution

59
Legal Matters

61
Experts

62
Where You Can Find More Information

63
We e x pe c t t ha t de live ry of t he N ot e s w ill be m a de a ga inst pa ym e nt t he re for on or a bout J une 2 5 , 2 0 1 8 , w hic h
w ill be t he t hird busine ss da y follow ing t he da t e of pric ing of t he N ot e s (suc h se t t le m e nt be ing re fe rre d t o a s
"T +3 "). U nde r Rule 1 5 c 6 -1 of t he Se c urit ie s Ex c ha nge Ac t of 1 9 3 4 , a s a m e nde d, t ra de s in t he se c onda ry m a rk e t
ge ne ra lly a re re quire d t o se t t le in t w o busine ss da ys, unle ss t he pa rt ie s t o a ny suc h t ra de e x pre ssly a gre e
ot he rw ise . Ac c ordingly, purc ha se rs w ho w ish t o t ra de t he N ot e s on t he da t e he re of w ill be re quire d, by virt ue of
t he fa c t t ha t t he N ot e s init ia lly w ill se t t le in T +3 , t o spe c ify a n a lt e rna t e se t t le m e nt c yc le a t t he t im e of a ny suc h
t ra de t o pre ve nt a fa ile d se t t le m e nt . Purc ha se rs of t he N ot e s w ho w ish t o t ra de t he N ot e s on t he da t e he re of
should c onsult t he ir ow n a dvisors.
S-i
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I N FORM AT I ON I N T H I S PROSPECT U S SU PPLEM EN T AN D T H E ACCOM PAN Y I N G PROSPECT U S
This document is in two parts. The first part is this prospectus supplement, which describes the specific terms of this offering of Notes.
The second part is the accompanying base prospectus, which gives more general information, some of which may not apply to this offering.
Generally, when we refer only to the "prospectus," we are referring to both this prospectus supplement and the accompanying base
prospectus combined. If the information relating to the offering varies between this prospectus supplement and the accompanying base
prospectus, you should rely on the information in this prospectus supplement.
Any statement made in this prospectus or in a document incorporated or deemed to be incorporated by reference into this prospectus
will be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in this prospectus or
in any other subsequently filed document that is also incorporated by reference into this prospectus modifies or supersedes that statement.
Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
Please read "Where You Can Find More Information" on page S-68 of this prospectus supplement.
We have not authorized anyone to provide any information or to make any representations other than those contained in this
prospectus supplement, the accompanying base prospectus or in any free writing prospectus we have prepared. Neither we nor the
underwriters take any responsibility for, or can provide any assurance as to the reliability of, any other information that others may give you.
We are not, and the underwriters are not, making an offer to sell these Notes in any jurisdiction where an offer or sale is not permitted. You
should not assume that the information contained in this prospectus supplement, the accompanying base prospectus or any free writing
prospectus is accurate as of any date other than the dates shown in these documents or that any information we have incorporated by
reference herein is accurate as of any date other than the date of the document incorporated by reference. Our business, financial condition,
results of operations and prospects may have changed since such dates.
None of EQT Midstream Partners, LP, the underwriters or any of their respective representatives is making any representation to you
regarding the legality of an investment in the Notes by you under applicable laws. You should consult with your own advisors as to legal,
tax, business, financial and related aspects of an investment in the Notes.
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On May 22, 2018, we closed our acquisition of Rice Olympus Midstream LLC (ROM), Strike Force Midstream Holdings LLC (Strike
Force Holdings) and Rice West Virginia Midstream LLC (Rice WV, together with ROM and Strike Force Holdings, the Drop-Down Entities)
from EQT Corporation (EQT) and its subsidiaries, collectively referred to as the Drop-Down Transactions, effective May 1, 2018. The Drop-
Down Transactions were between entities under common control. As a result, we recast our financial statements for the periods the
businesses were under common control of EQT, which was the period from November 13, 2017, the date of the completion of EQT's
acquisition of Rice Energy Inc., to retrospectively reflect the results attributable to the businesses acquired in the Drop-Down Transactions.
Information in this prospectus supplement derived from our financial statements reflects such recast financial statements, which were
included as exhibits to our Current Report on Form 8-K filed on June 12, 2018 and are incorporated herein by reference.
When we present financial information on a pro forma basis, unless otherwise stated, we are giving pro forma effect to the Proposed
Merger (as defined below), the Drop-Down Transactions and the Gulfport Transaction (as defined below), including the effects of the
S-ii
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expected financing of such transactions (collectively, the Pro Forma Events) as if they occurred on (i) January 1, 2017 in the case of pro
forma statement of combined operations data for the three months ended March 31, 2018 and for the year ended December 31, 2017 and
(ii) March 31, 2018 in the case of the pro forma condensed combined balance sheet data. For additional information, see "Summary
Unaudited Pro Forma Condensed Combined Financial Statements."
CAU T I ON ARY ST AT EM EN T REGARDI N G FORWARD-LOOK I N G ST AT EM EN T S
This prospectus supplement, the accompanying base prospectus and the documents incorporated by reference herein and therein
contain certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the
Exchange Act), and Section 27A of the Securities Act of 1933, as amended (the Securities Act). Statements that do not relate strictly to
historical or current facts are forward-looking and usually identified by the use of words such as "anticipate," "estimate," "could," "would,"
"will," "may," "forecast," "approximate," "expect," "project," "intend," "plan," "believe" and other words of similar meaning in connection with
any discussion of future operating or financial matters. Without limiting the generality of the foregoing, forward-looking statements contained
in this prospectus supplement, the accompanying base prospectus and the documents we incorporate by reference include our expectations
of plans, strategies, objectives and growth and anticipated financial and operational performance of us and our subsidiaries, including
guidance regarding our gathering and transmission and storage revenue and volume growth; revenue projections; the weighted average
contract life of gathering, transmission and storage contracts; infrastructure programs (including the timing, cost, capacity and sources of
funding with respect to gathering and transmission expansion projects); the cost, capacity, timing of regulatory approvals and anticipated in-
service date of the Mountain Valley Pipeline (MVP) and MVP Southgate projects; the ultimate terms, partners and structure of the MVP joint
venture; expansion projects in our operating areas and in areas that would provide access to new markets; asset acquisitions, including our
ability to complete asset acquisitions; whether the Proposed Merger will be completed and the timing of the transaction; the risk that we
may be unable to obtain governmental and regulatory approvals required for the Proposed Merger, or required governmental and regulatory
approvals may delay the Proposed Merger or result in the imposition of conditions that could cause the parties to abandon the Proposed
Merger; the risk that a condition to closing of the Proposed Merger may not be satisfied, including approval of the Proposed Merger by
holders of a majority of the outstanding Rice Midstream Partners LP (NYSE: RMP) (RMP) common units; the possible diversion of
management's time on issues related to the Proposed Merger; the impact and outcome of pending and future litigation, including litigation, if
any, relating to the Proposed Merger; the risk that we may be unable to successfully combine the businesses of EQM and RMP in the
expected time frame; the timing of the proposed separation of EQT's production and midstream businesses (the Proposed Separation) and
the parties' ability to complete the separation; the amount and timing of distributions, including expected increases; the amount and timing of
projected capital contributions and operating and capital expenditures, including the amount of capital expenditures reimbursable by EQT;
the impact of commodity prices on our business; liquidity and financing requirements, including sources and availability; the effects of
government regulation and litigation; and tax position. The forward-looking statements included in this prospectus supplement, the
accompanying base prospectus and the documents incorporated by reference herein and therein involve risks and uncertainties that could
cause actual results to differ materially from projected results. Accordingly, investors should not place undue reliance on forward-looking
statements as a prediction of actual results. We have based these forward-looking statements on current
S-iii
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expectations and assumptions about future events. While we consider these expectations and assumptions to be reasonable, they are
inherently subject to significant business, economic, competitive, and regulatory and other risks and uncertainties, many of which are difficult
to predict and beyond our control. The risks and uncertainties that may affect the operations, performance and results of our business and
forward-looking statements include, but are not limited to, those set forth under "Risk Factors" beginning on page S-15 of this prospectus
supplement, page 3 of the accompanying base prospectus and the applicable documents incorporated by reference herein and therein.
Many of the factors that will determine actual results are beyond our ability to control or predict. Specific factors which could cause
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actual results to differ from those in the forward-looking statements include, but are not limited to, the following:
·
changes in general economic conditions;
·
competitive conditions in our industry;
·
actions taken by third-party operators, processors, transporters and gatherers;
·
changes in expected production from EQT and third parties in our areas of operation;
·
changes in expected demand for natural gas gathering, transmission and storage services;
·
our ability to successfully implement our business plan;
·
our ability to complete organic growth projects on time and on budget;
·
our ability to complete acquisitions;
·
the occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement
(as defined below) or the failure to satisfy the closing conditions;
·
the possibility that the consummation of the Proposed Merger is delayed or does not occur, including due to the failure to
obtain the required approval of the RMP unitholders, which may have adverse effects on our business and unit price;
·
the ability to obtain the regulatory approvals required to complete the Proposed Merger as contemplated by the Merger
Agreement, and the timing and conditions for such approvals;
·
the effects of the combination of our business with that of RMP's, including the combined company's future financial condition,
results of operations, strategy and plans;
·
unexpected costs or unexpected liabilities that may arise from the Proposed Merger, whether or not consummated;
·
the price and availability of debt and equity financing;
·
the availability and price of natural gas to the consumer compared to the price of alternative and competing fuels;
·
competition from alternative energy sources;
·
energy efficiency and technology trends;
·
operating hazards and other risks incidental to gathering, transporting and storing natural gas;
S-iv
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·
natural disasters, weather-related delays, casualty losses and other matters beyond our control;
·
interest rates;
·
labor relations;
·
large customer defaults;
·
changes in tax status;
·
the effects of existing and future laws and governmental regulation in general, including the passage of legislation, to block the
Proposed Merger or otherwise adversely affecting us;
·
the effects of litigation, including litigation that has been or may be instituted against us, RMP or others following
announcement of the Proposed Merger; and
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·
certain factors discussed elsewhere in this prospectus supplement and the documents incorporated by reference herein.
The foregoing list of factors should not be construed to be exhaustive. Many factors mentioned in this prospectus, including the risks
outlined under the caption "Risk Factors" contained in our Exchange Act reports incorporated herein by reference, will be important in
determining future results, and actual future results may vary materially. There is no assurance that the actions, events or results of the
forward-looking statements will occur or, if any of them do, when they will occur or what effect they will have on our results of operations,
financial condition, cash flows or distributions. Further, any forward-looking statement speaks only as of the date on which it is made, and,
except as required by law, we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances
after the date on which it is made or to reflect new information or the occurrence of anticipated or unanticipated events or circumstances.
S-v
Table of Contents
SU M M ARY
This summary highlights information contained elsewhere in or incorporated by reference into this prospectus supplement and the
accompanying base prospectus. This summary does not contain all of the information that you should consider before investing in the
Notes. You should read the entire prospectus supplement, the accompanying base prospectus and the documents incorporated herein by
reference and other documents to which we refer for a more complete understanding of this offering. You should read "Risk Factors"
beginning on page S-15 of this prospectus supplement and on page 3 of the accompanying base prospectus for more information about
important risks that you should consider carefully before making a decision to purchase any Notes in this offering.
References in this prospectus supplement or the accompanying base prospectus to "EQT Midstream Partners," "EQM," "the
Partnership," "we," "our," "us" or like terms refer to EQT Midstream Partners, LP (NYSE: EQM) and its subsidiaries, unless the context
clearly indicates otherwise. With respect to the cover page and in the sections entitled "Summary--The Offering," "Description of Other
Indebtedness" and "Description of Notes," "the Partnership," "EQM," "we," "our" and "us" refer only to EQT Midstream Partners, LP.
References in this prospectus supplement or the accompanying base prospectus to "our general partner" refer to EQT Midstream
Services, LLC, a wholly owned subsidiary of EQT GP Holdings, LP (NYSE: EQGP) (EQGP), which is a subsidiary of EQT. References in
this prospectus supplement or the accompanying base prospectus to "EQT" refer to EQT Corporation (NYSE: EQT) and its consolidated
subsidiaries.
Ove rvie w
We are a growth-oriented limited partnership formed by EQT to own, operate, acquire and develop midstream assets in the
Appalachian Basin. We provide midstream services to EQT and multiple third parties in Pennsylvania, West Virginia and Ohio through our
two primary assets: the gathering system, which delivers natural gas from wells and other receipt points to transmission pipelines, and the
transmission and storage system, which delivers gas to local demand users and interstate pipelines for access to demand markets. We
provide a substantial majority of our natural gas gathering, transmission and storage services under contracts with long-term, firm
reservation and/or usage fees. This contract structure enhances the stability of our cash flows and limits our direct exposure to commodity
price risk. Approximately 89% of our revenues, or 60% of our revenues on a pro forma basis, were generated from capacity reservation
charges under long-term firm contracts for the year ended December 31, 2017. When including contracts associated with expected future
capacity from expansion projects that are not yet fully constructed but for which we have entered into firm contracts, firm gathering contracts
had a weighted average remaining term of approximately 8 years and firm transmission and storage contracts had a weighted average
remaining term of approximately 15 years, in each case as of December 31, 2017, based on total projected revenues. Our operations are
primarily focused in southwestern Pennsylvania, northern West Virginia and eastern Ohio, a strategic location in the natural gas shale plays
known as the Marcellus, Utica and Upper Devonian Shales. This same region is also the primary operating area of EQT, our largest
customer. EQT accounted for approximately 73% of our revenues, or 79% of our revenues on a pro forma basis, for the year ended
December 31, 2017.
Gathering Business Segment
As of December 31, 2017, our gathering system included approximately 450 miles of high pressure gathering lines with approximately
2.3 Bcf per day of total firm contracted gathering
S-1
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capacity, compression of approximately 220,000 horsepower and multiple interconnect points with our transmission and storage system. Our
gathering system also included approximately 1,500 miles of low pressure gathering lines regulated by the Federal Energy Regulatory
Commission (FERC). Gathering revenues represented approximately 56%, 54% and 53% of our total revenues for the years ended
December 31, 2017, 2016 and 2015, respectively, and 63% on a pro forma basis for the year ended December 31, 2017.
Transmission Business Segment
As of December 31, 2017, our transmission and storage system included an approximately 950-mile FERC-regulated interstate
pipeline that connects to seven interstate pipelines and local distribution companies (LDCs). The transmission system is supported by 18
associated natural gas storage reservoirs with approximately 645 MMcf per day of peak withdrawal capacity, 43 Bcf of working gas capacity
and 41 compressor units, with total throughput capacity of approximately 4.4 Bcf per day and compression of approximately 120,000
horsepower as of December 31, 2017. Revenues associated with our transmission and storage system represented approximately 44%,
46% and 47% of our total revenues for the years ended December 31, 2017, 2016 and 2015, respectively, and 29% on a pro forma basis
for the year ended December 31, 2017.
As of December 31, 2017, approximately 89% of our contracted transmission firm capacity was subscribed by customers under
negotiated rate agreements under our tariff. Approximately 9% of our contracted transmission firm capacity was subscribed at the recourse
rates under our tariff, which are the maximum rates an interstate pipeline may charge for its services under its tariff. The remaining 2% of
our contracted transmission firm capacity was subscribed at discounted rates, which are less than the maximum rates an interstate pipeline
may charge for its services under its tariff.
Pursuant to an acreage dedication to us from EQT, we have the right to elect to transport on our transmission and storage system all
natural gas produced from wells drilled by EQT under an area covering approximately 60,000 acres in Allegheny, Washington and Greene
counties in Pennsylvania and Wetzel, Marion, Taylor, Tyler, Doddridge, Harrison and Lewis counties in West Virginia. EQT has a significant
natural gas drilling program in these areas.
Gathering and Transmission System Expansion Projects
We expect that the following expansion projects will allow us to capitalize on drilling activity by EQT and other third party producers:
·
Mountain Valley Pipeline. Mountain Valley Pipeline, LLC (the MVP Joint Venture) is a joint venture with affiliates of each of
NextEra Energy, Inc., Consolidated Edison, Inc., WGL Holdings, Inc. and RGC Resources, Inc. We are the operator of the
MVP and owned a 45.5% interest in the MVP Joint Venture as of December 31, 2017. The 42 inch diameter MVP has a
targeted capacity of 2.0 Bcf per day and is estimated to span 300 miles extending from our existing transmission and storage
system in Wetzel County, West Virginia to Pittsylvania County, Virginia, providing access to the growing Southeast demand
markets. As currently designed, the MVP is estimated to cost a total of approximately $3.5 billion, excluding allowance for
funds used during construction, with our proportionate share being funded through capital contributions made to the MVP Joint
Venture. In 2018, we expect to provide capital contributions of $1.0 billion to $1.2 billion to the MVP Joint Venture. The MVP
Joint Venture has secured a total of 2.0 Bcf per day of firm capacity commitments at 20-year terms, including an initial
1.29 Bcf per day firm capacity commitment by EQT, and is currently in negotiations with
S-2
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additional shippers who have expressed interest in the MVP project.
In October 2017, the FERC issued the Certificate of Public Convenience and Necessity for the MVP project. In early 2018, the
MVP Joint Venture received limited notice to proceed with certain construction activities from the FERC. The MVP Joint
Venture commenced construction on the MVP during the first quarter of 2018. The MVP is targeted to be placed in-service
during the fourth quarter of 2018.
In April 2018, the MVP Joint Venture announced the MVP Southgate project, a proposed 70-mile interstate pipeline that will
extend from the MVP at Pittsylvania County, Virginia to new delivery points in Rockingham and Alamance Counties, North
Carolina. The project is anchored by a firm capacity commitment from PSNC Energy. The final project scope will be
determined after a binding open season. The preliminary project cost estimate is $350 million to $500 million, which is
expected to be spent in 2019 and 2020. We are expected to have between 33% and 48% ownership in the project and will
operate the pipeline. Subject to approval by the FERC, MVP Southgate has a targeted in-service date of the fourth quarter
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2020.
·
Gathering Expansion Projects. We invested approximately $226 million on gathering projects in 2017 that added
approximately 475 MMcf per day of firm gathering capacity in southwestern Pennsylvania. This included the final phase of a
header pipeline for Range Resources Corporation (Range Resources), which was placed in-service during the second quarter
of 2017. The system now provides total firm gathering capacity of 600 MMcf per day at a total project cost of approximately
$240 million. This and other expansion projects, primarily for affiliates, supported increased gathered volumes of 23% and
gathering revenues of 21% in 2017. In 2018, we estimate capital expenditures of approximately $510 million on gathering
expansion projects, primarily driven by wellhead and header projects in Pennsylvania, West Virginia and Ohio, including
commencing preliminary construction activities on the Hammerhead project, a 1.2 Bcf per day gathering header pipeline
connecting Pennsylvania and West Virginia production to the MVP.
·
Equitrans and Transmission Expansion. In 2015, we began several multi-year transmission projects to support Marcellus,
Utica and Upper Devonian Shale development, including the Ohio Valley Connector (OVC), the Equitrans Expansion project
and the MVP. The OVC was placed in-service during the fourth quarter of 2016, providing shippers access to the Midwest
markets. The Equitrans Expansion is designed to provide north-to-south capacity on the mainline Equitrans system for
deliveries to the MVP. The Equitrans Expansion project and the MVP are expected to be constructed in 2018 and together will
further diversify the market access on the Equitrans system by providing 2 Bcf per day of capacity to the growing Southeast
demand markets. In 2018, we estimate capital expenditures of approximately $100 million for other transmission expansion
projects, primarily attributable to the Equitrans Expansion project.
Re c e nt De ve lopm e nt s
The Proposed Merger
On April 25, 2018, we entered into an Agreement and Plan of Merger (the Merger Agreement) with RMP, Rice Midstream
Management LLC, the general partner of RMP (the RMP General Partner), our general partner, EQM Acquisition Sub, LLC, our wholly
owned subsidiary (Merger Sub), EQM GP Acquisition Sub, LLC, our wholly owned subsidiary (GP Merger Sub), and, solely for certain
limited purposes set forth therein, EQT. Pursuant to the Merger Agreement, Merger Sub and GP Merger Sub will merge with and into RMP
and the
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RMP General Partner, respectively, with RMP and the RMP General Partner surviving as our wholly owned subsidiaries (the Proposed
Merger). Pursuant to the Merger Agreement, each RMP common unit issued and outstanding immediately prior to the effective time of the
Proposed Merger will be converted into the right to receive 0.3319 EQM common units.
The completion of the Proposed Merger is subject to the satisfaction or waiver of certain customary closing conditions, including, but
not limited to: (i) approval of the Merger Agreement and the Proposed Merger by holders of a majority of the outstanding RMP common
units, (ii) expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, (iii) the completion of the Drop-Down Transactions (as defined below), and (iv) the completion of EQGP's acquisition of all of the
outstanding RMP incentive distribution rights (IDRs) from EQT (the IDR Transaction), of which conditions (iii) and (iv) have been satisfied.
The consummation of the Proposed Merger is not contingent on the completion of this offering. We expect to complete the Proposed Merger
during the third quarter of 2018.
This offering is not conditioned on the consummation of the Proposed Merger, and there can be no assurance that the Proposed
Merger will be completed in the anticipated time frame or at all. See "Risk Factors--Risks Related to the Notes--We may not consummate
the Proposed Merger, and this offering is not conditioned on the consummation of the Proposed Merger."
RMP is a limited partnership originally formed by Rice Energy, Inc. (Rice) in order to own, operate, develop and acquire midstream
assets in the Appalachian Basin. RMP operates in two business segments, which are managed separately due to their distinct operational
differences: (i) gathering and (ii) water. RMP's natural gas gathering assets consist of natural gas gathering systems and associated
compression that service EQT and other third-party producers in the dry gas core of the Marcellus Shale in southwestern Pennsylvania. For
the three months ended March 31, 2018, RMP's average daily throughput was 1.7 Bcf. As of December 31, 2017, RMP's gathering assets
consisted of 178 miles of pipeline with gathering capacity of 5.1 TBtu/d and compression capacity of approximately 85,000 horsepower. RMP
provides its services under long-term, fee-based contracts, primarily to EQT and its affiliates. RMP has dedications from certain EQT
affiliates under various fixed price per unit gathering and compression agreements covering (i) approximately 246,000 gross acres of EQT's
acreage position as of December 31, 2017 in Washington and Greene Counties, Pennsylvania, and (ii) subject to certain exceptions and
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limitations pursuant to the gathering and compression agreements, any future acreage certain affiliates of EQT acquire within those counties.
RMP's water services assets consist of water pipelines, impoundment facilities, pumping stations, take point facilities and measurement
facilities, which are used to support well completion activities and to collect and recycle or dispose of flowback and produced water for EQT
and other third-party producers in Washington and Greene Counties, Pennsylvania and Belmont County, Ohio. As of December 31, 2017,
RMP's Pennsylvania assets provided access to 29.4 MMgal/d of fresh water from the Monongahela River and several other regional water
sources, while RMP's Ohio assets provided access to 14.0 MMgal/d of fresh water from the Ohio River and several other regional water
sources, both for distribution to EQT and third parties.
Drop-Down Transactions and Gulfport Transaction
On April 25, 2018, we entered into a Contribution and Sale Agreement (the Drop-Down Agreement) with EQT, Rice Midstream
Holdings LLC, a wholly owned subsidiary of EQT (Rice Midstream Holdings), and EQM Gathering Holdings, LLC (EQM Gathering), our
wholly owned
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subsidiary, pursuant to which EQM Gathering acquired from EQT all of EQT's interests in ROM, Rice WV and Strike Force Holdings in
exchange for an aggregate of 5,889,282 EQM common units and aggregate cash consideration of $1.15 billion, subject to customary
purchase price adjustments (collectively, the Drop-Down Transactions). Strike Force Holdings owns a 75% limited liability company interest
in Strike Force Midstream LLC (Strike Force Midstream).
ROM owns a natural gas gathering system including approximately 80 miles of natural gas gathering pipelines and compressor stations
that transport gas from wells located primarily in Belmont County, Ohio. ROM has an acreage dedication from EQT covering approximately
68,000 acres. The ROM natural gas gathering pipelines had an average throughput capacity of 1.0 Bcf per day for the quarter ended
March 31, 2018. Strike Force Midstream owns natural gas gathering assets to support dry gas Utica Shale development in Belmont and
Monroe Counties, Ohio, and includes approximately 70 miles of natural gas gathering pipelines and 17,000 horsepower of compression.
Strike Force Midstream has an acreage dedication from EQT covering approximately 98,000 acres and a gathering agreement with Gulfport
Energy Corporation (Gulfport) that includes a five-year minimum volume commitment. The Strike Force Midstream natural gas gathering
assets had an average throughput capacity of 0.9 Bcf per day for the quarter ended March 31, 2018. Rice WV owns approximately 31 miles
of right-of-way assets. We completed the Drop-Down Transactions on May 22, 2018, with an effective date of May 1, 2018.
On May 1, 2018, pursuant to the Purchase and Sale Agreement, dated April 25, 2018, by and among us, EQM Gathering, Gulfport
and an affiliate of Gulfport, we acquired the remaining 25% limited liability company interest in Strike Force Midstream not owned by Strike
Force Holdings for $175 million (the Gulfport Transaction). As a result of the Gulfport Transaction and the Drop-Down Transactions, we now
own 100% of Strike Force Midstream.
EQM Term Loan Facility
On April 25, 2018, we entered into a 364-day term loan agreement (the Term Loan Agreement) among us, Wells Fargo Bank, National
Association, as the administrative agent, and the lenders (the Term Loan Lenders) and agents parties thereto, providing for a $2.5 billion
364-day unsecured multi-draw term loan facility (the EQM Term Loan Facility). As of June 15, 2018, we had borrowed $1.825 billion under
the EQM Term Loan Facility, $1.15 billion of which was used to fund the cash consideration for the Drop-Down Transactions, $513 million
of which was used to repay borrowings under the $1 Billion Facility (as defined under "Description of Other Indebtedness"), including
amounts borrowed to pay the $175 million to Gulfport in connection with the Gulfport Transaction, and the remainder was used for general
partnership purposes. Additional borrowings under the EQM Term Loan Facility may be used for a variety of specified purposes, as well as
general partnership purposes; however, the receipt of the net cash proceeds from this offering will result in the termination of the remaining
unused commitments under the EQM Term Loan Facility. The Term Loan Agreement includes mandatory prepayment and commitment
reduction requirements related to our receipt of net cash proceeds from certain debt transactions (including the net cash proceeds received
in connection with the issuance of the Notes), equity issuances, asset sales and joint venture distributions. We intend to use a portion of the
net proceeds from this offering to repay all outstanding borrowings under the EQM Term Loan Facility. For additional information, see "Use
of Proceeds."
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Our Re la t ionship w it h EQT
EQT is an integrated energy company, with an emphasis on natural gas production, gathering and transmission. EQT conducts its
business through five business segments: EQT Production, EQM Gathering, EQM Transmission, RMP Gathering and RMP Water. EQT
Production is the largest natural gas producer in the United States, based on average daily sales volumes, with 21.4 Tcfe of proved natural
gas, natural gas liquids and crude oil reserves across approximately 4.0 million gross acres, including approximately 1.1 million gross acres
in the Marcellus play, many of which have associated deep Utica and/or Upper Devonian drilling rights, and approximately 0.1 million gross
acres in the Ohio Utica play as of December 31, 2017. EQM Gathering and EQM Transmission provide gathering, transmission and storage
services for EQT's produced gas, as well as for independent third parties across the Appalachian Basin through EQM. RMP Gathering
provides natural gas gathering and compression services primarily to EQT in the dry gas core of the Marcellus Shale in southwestern
Pennsylvania through RMP. RMP Water provides water services that support well completion activities and collects and recycles or disposes
of flowback and produced water for EQT and third parties in Washington and Greene Counties, Pennsylvania and Belmont County, Ohio
through RMP.
As of June 12, 2018, EQGP owned a 1.6% general partner interest in us, all of our IDRs and a 24.8% limited partner interest in us,
and EQT owned a 6.7% limited partner interest in us. As of June 12, 2018, EQT owned a 91.3% limited partner interest in EQGP and 100%
of the non-economic general partner interest in EQGP.
Our relationship with EQT is also a source of potential conflicts. For example, EQT is not restricted from competing with us, whether
directly or indirectly. In addition, all of the executive officers and five of the directors of our general partner also serve as officers and/or
directors of EQT, all of the executive officers and five of the directors of our general partner also serve as officers and/or directors of
EQT GP Services, LLC, the general partner of EQGP, and all of the executive officers and four of the directors of our general partner also
serve as officers and/or directors of the RMP General Partner. These individuals face conflicts of interest, which include the allocation of
their time among us, EQT, EQGP and RMP.
On February 21, 2018, EQT announced that the EQT board of directors had unanimously approved a plan for the Proposed
Separation. This offering is not conditioned on the consummation of the Proposed Separation, and there can be no assurance that the
Proposed Separation will be completed. See "Risk Factors--Risk Related to the Notes--We may not consummate the Proposed Separation,
and this offering is not conditioned on the consummation of the Proposed Separation." As a result of the Proposed Separation, if
consummated, the interests in EQM and EQGP currently held by EQT will be owned by the standalone publicly traded corporation that will
focus on midstream operations, but our commercial contracts with EQT would continue in effect. See "Risk Factors--Risks Related to the
Notes--The indentures governing the Notes do not require us to repurchase or redeem the Notes upon consummation of the Proposed
Separation or certain other transactions, and the new public company formed in the Proposed Separation will not initially own any material
assets other than its interests in us and EQGP."
Princ ipa l Ex e c ut ive Offic e s a nd I nt e rne t Addre ss
Our principal executive offices are located at 625 Liberty Avenue, Suite 1700, Pittsburgh, Pennsylvania 15222, and our telephone
number is (412) 553-5700. Our website is located at www.eqtmidstreampartners.com. We make available our periodic reports and other
information filed with or furnished to the Securities and Exchange Commission (SEC) free of
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charge through our website, as soon as reasonably practicable after those reports and other information are electronically filed with or
furnished to the SEC. Information on our website or any other website is not incorporated by reference herein and does not constitute a part
of this prospectus.
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