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Range reduces spending, boosts production estimates for

2025

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EQT maintains spending, increases 2025 gas output

expectations

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Analysts focus on EQT's Pennsylvania gas supply deals

By Scott DiSavino

July 23 (Reuters) - U.S. energy companies EQT

and Range Resources ( RRC ) expect to produce more natural gas

in 2025 to meet rising demand for the fuel without boosting

planned spending.

Demand for gas to produce power for data centers in the U.S.

and for export to the rest of the world as liquefied natural gas

is on track to keep hitting record highs in coming years,

according to energy analysts.

"We believe Range is incredibly well positioned to support

these initiatives, being one of the few producers in Appalachia

with sufficient high-quality inventory to support the required

long-term durable supply of natural gas," Range CEO Dennis

Degner told analysts on an earnings call on Wednesday.

In its second-quarter earnings, Range revised its all-in capital

budget to $650 million-$680 million, down from the company's

first-quarter guidance of $650 million-$690 million.

Range also boosted its annual production estimate in the

second quarter to around 2.225 billion cubic feet of gas

equivalent per day (bcfed) in 2025, up from its first-quarter

guidance of around 2.2 bcfed for the year.

In the second quarter, Range said it produced about 2.2

bcfed, the same as in the first quarter.

Looking ahead, Range said in an earnings presentation that

it planned $650 million-$700 million in annual capital

expenditures from 2025 to 2027, which should boost daily

production to around 2.4 bcfed in 2026 and 2.6 bcfed in 2027.

Range shares were little changed around $35.63 in afternoon

trade.

EQT EXPECTS HIGHER OUTPUT

EQT, the second-biggest gas producer, also boosted

the amount of gas it expected to pull out of the ground in 2025,

while keeping planned spending flat.

In its second-quarter earnings, EQT reaffirmed its total capital

expenditure guidance of $2.30 billion-$2.45 billion in 2025 and

boosted its expected total sales volume to 6.30-6.58 bcfed.

That is up from EQT's first-quarter production expectation

of 6.03-6.30 bcfed for 2025 and compares with capital spending

of around $2.266 billion last year and average production of

6.10 bcfed in 2024.

Analysts at Mizuho said in a note that investors were largely

focused on potential details from EQT's recently announced gas

supply deals to the Shippingport and Homer City power generation

projects in Pennsylvania.

EQT said the Pennsylvania projects will add to the

reliability of regional electric grid and supply energy to

Artificial Intelligence data centers under development.

EQT told analysts it could not disclose specific contract

terms or end customers, but said the company expects the

projects to add approximately $250 million of recurring free

cash flow by 2029.

"Initially, we will reallocate volumes to fill this new

demand, followed by steady, mid-single-digit multi-year growth.

We have the capacity to grow production by at least 2 bcfd to

backfill these volumes, which means we've set the stage to

responsibly grow the business by at least 30% over the coming

years," EQT Chief Financial Officer Jeremy Knop told analysts on

a call.

EQT shares were down about 4.2% to around $52, putting the

stock on track for its lowest close since early May.

"Based on recent investors conversations, we believe (the

free cash flow uplift) was at the lower end of expectations,"

Mizuho said, noting the uplift was tied to several projects,

including a power generation project in West Virginia.

"Overall, improving demand in Appalachia should be a

tailwind for the low-cost producer," Mizuho said, referring to

EQT.