May 23, 2019

Dear Fellow EQT Shareholder:

Over the last year, EQT Corporation (“EQT” or the “Company”) has transformed into a focused upstream industry leader with a simplified corporate structure and a refreshed Board of Directors (the “Board”) and management team. The new management team has implemented a profound cultural shift across the organization and spearheaded an ambitious, realistic strategic plan to drive operational excellence and shareholder value creation.

Before EQT’s Annual Meeting of Shareholders on July 10, 2019 (the “Annual Meeting”), you will be asked to make an important decision regarding the composition of the Board. Your decision will impact the future of the Company and the value of your investment in EQT.

At this year’s meeting, a group led by Toby Z. Rice and Derek A. Rice (the “Rice Group”) is seeking to take control of the Board. The Rice campaign is premised on stale arguments that are irrelevant following the significant transformation EQT has undertaken since the new management team assumed their roles. Based on what Toby Rice himself told our Board, we believe that the Rice family’s campaign is a ruse to install Toby as CEO, replace the EQT Board and management team with friends and family and pursue a risky, misguided and value-destructive plan instead of EQT’s proven strategy.

We encourage you to support the EQT team and the effective strategy that is delivering results and vote today on the GOLD universal proxy card “FOR” EQT’s 12 nominees:

Philip G. Behrman, Ph.D., Janet L. Carrig, Christina A. Cassotis, William M. Lambert, Gerald F. MacCleary, James T. McManus II, Robert J. McNally, Valerie A. Mitchell, Anita M. Powers, Daniel J. Rice IV, Stephen A. Thorington and Christine J. Toretti.

We believe the choice is clear:


Support the EQT team that is driving substantial and sustainable free cash flow and shareholder value or




Cede control of EQT to the Toby Rice slate, a team of family and friends that is deeply conflicted and NEVER generated positive free cash flow at Rice Energy.


Today, EQT is the largest independent natural gas producer in the United States with a world-class asset base positioned squarely in the core of the Appalachian basin with 15 to 20 years of drilling inventory.

As part of EQT’s transformation into a focused upstream industry leader, the Company refreshed its Board and management team. Rob McNally was appointed CEO in November 2018 and has been leading EQT’s transformation into a cash flow generating machine.

EQT Is Outperforming Appalachian Peers

As market sentiment shifted to focus on capital efficiencies over volume growth, so have EQT’s operations. We anticipated this shift and took aggressive, meaningful and decisive steps to reduce costs and drive efficiencies to generate substantial and sustainable free cash flow growth.

We have increased production volumes, delivered substantial operational improvements and reduced annual costs by $150 million, helping to drive free cash flow. Our strategy has delivered results, with EQT’s share price outperforming Appalachian peers¹ by 61% since the spin-off and 24% year-to-date. Even so, we understand there is more work to be done and are committed to delivering greater results for shareholders.

Operating plan focused on enhancing operations, increasing efficiency and accelerating free cash flow growth

Working to address legacy issues, EQT’s new management team acted swiftly and developed a rigorous, bottom-up operating plan that was unveiled in January 2019. Taking into account the views of investors, the plan is focused on reducing costs and driving efficiencies to generate substantial and sustainable free cash flow growth and create significant value for shareholders.

Decisive actions taken to optimize operational results

In December, the Board formed an Operating and Capital Efficiency Committee. This committee is made up of independent directors who collectively have more than 125 years of E&P operating experience. The committee has undertaken an ongoing review of the Company’s operations and capital deployment, reviewed detailed operational benchmarking analyses and remained fully engaged in our efforts to drive further efficiency gains and cost reductions.

In March, our deep bench of talent was strengthened with the appointment of Gary Gould as Chief Operating Officer. Gary has more than three decades of relevant industry experience, including direct experience in the Marcellus basin. Prior to joining EQT, he served in senior operational leadership roles at Continental Resources, Chesapeake Energy, Kinder Morgan, Inc., ConocoPhillips, Burlington Resources, Inc. and Exxon Corporation. Gary is ideally and uniquely suited to drive cost reductions incremental to our targets and support our focus on free cash flow generation. As the Operating and Capital Efficiency Committee and Gary work to capture more operating efficiencies, EQT is well positioned to further reduce costs.


As we have implemented comprehensive cultural changes, EQT has generated more than $300 million of adjusted free cash flow2 over the last two quarters and remains on track to deliver approximately $300 to $400 million of adjusted free cash flow2 in 2019. Given our success to date, the Company is expected to generate at least $2.9 billion of adjusted free cash flow 2 over the next five years.

The Rice Team has never generated positive free cash flow

On the other hand, Rice Energy never produced positive annual free cash flow while operating as a public company. In fact, it burned through approximately $5 billion of capital from 2012 through the third quarter of 2017. Any claims from the Rice family that they can deliver an incremental $500 million in free cash flow from EQT’s plan are baseless and are not supported by their own track record.

EQT’s operational focus is driving further cost savings

With the support and oversight of Rob McNally, Gary Gould and our Operating and Capital Efficiency Committee, we expect to realize additional savings over the next five years through the successful execution of our “Target 10% Initiative.” Through this initiative, EQT is actively pursuing more than 100 projects that we anticipate will further drive down costs in 2019 and beyond. If fully executed, these initiatives are expected to increase cumulative five-year adjusted free cash flow2 to approximately $3.4 billion.

EQT is one of the industry’s lowest cost operators

Contrary to the Rices’ repeated claims, EQT already stands as one of the lowest cost operators in its peer group, as noted in the chart.


EQT has demonstrated that we value the feedback we have received through extensive shareholder engagement. Board refreshment is a priority for the new EQT, and we are pleased to nominate Janet Carrig, James McManus and Valerie Mitchell to serve as new, independent directors.

The Rice family already has proportionate representation on EQT’s Board

Given the Rice family’s 3.1% ownership interest in EQT, and Daniel Rice’s position as a director on the EQT Board standing for reelection, we do not believe the addition of other Rice family members or their designees is appropriate or consistent with best-in-class governance practices. The Board believes Daniel brings relevant experience with regard to Rice Energy’s legacy assets as well as a former public company CEO’s perspective to the EQT boardroom.

Best-in-industry Board composition

The composition of our 2019 director slate reflects our focus on closely aligning the skill sets, experience and perspectives of the Company’s directors with the dynamic needs of EQT. We are confident that our new nominees and the incumbent directors seeking reelection are best qualified to help ensure EQT continues to successfully generate substantial and sustainable free cash flow growth.

Enfranchising EQT shareholders with the universal proxy card

EQT’s commitment to outstanding governance extends beyond refreshment actions. For the upcoming Annual Meeting, EQT is implementing one of today’s most forward-thinking governance constructs – the universal proxy card.

The SEC, institutional investors and proxy advisor firms have advocated for universal proxy cards as a way to ensure a more fair, less cumbersome voting process. A universal proxy card provides for all nominees put forth by the EQT Board and the Rice Group to be listed on the same proxy card, allowing shareholders to elect any combination of the nominees they choose without attending the shareholder meeting in person.



EQT has responsibly, but meaningfully, disrupted the status quo. As reflected in the actions taken over the last year, we embrace disruption when we believe changes will yield improved and meaningful results without introducing material risk to ongoing operations.

EQT’s director nominees are more qualified

EQT met with the Rices, thoroughly evaluated their claims and determined that their operational ideas are flawed and based on assumptions that overlook key business fundamentals. After careful consideration, the Board determined that the EQT nominees are better suited to continue to oversee EQT’s successful transformation. Toby Rice’s proposal for wholesale change would be counterproductive and destabilizing, especially amid a successful transformation.

Toby Rice intends to replace EQT’s department heads with Rice friends and family

Despite the successful turnaround at EQT that your refreshed Board and management team have overseen, Toby Rice is seeking to replace the majority of the Board and install himself as CEO. Toby Rice has also clearly articulated his intention to appoint former Rice Energy employees – a group that includes his wife and his college baseball coach – to replace up to 15 of the Company’s department heads. We believe the turmoil that would result from the wholesale replacement of the Board and management team would disrupt the Company’s progress, impact financial and operational results, create uncertainty and fear with employees and impair EQT’s valuation.

Toby Rice was replaced as CEO of his own company

The Board carefully considered these factors, noting that Toby Rice was replaced as CEO by his brother Daniel prior to Rice Energy’s IPO and that several of the Rice Group’s nominees oversaw poor governance practices as Rice Energy directors. The Board also has serious concerns about potential conflicts of interest of the Rice Group’s nominees because a number of them have a long history of friendship and service to the Rice family, and at least one has a relative who was employed by Rice Energy.

EQT should not be a family business

The replacement of management with Toby Rice’s friends and family would be irresponsible and a significant step backward for EQT from a governance perspective. We do not believe that turning EQT into a family-and-friends club is in the best interests of the Company or all shareholders. Moreover, we do not believe that Toby Rice is fit to serve as a director or officer of EQT.



Support the nominees who are independent, not conflicted and successfully overseeing the execution of a proven plan that has already created value for shareholders and will continue to do so in the short and long term. We believe the Rices are using irrelevant information and outdated statistics from the old EQT in an effort to mislead shareholders and advance their campaign to take control of EQT and turn it into a family business. A vote for EQT’s 12 nominees is a vote to reject the Rices’ fundamentally conflicted and self-serving agenda and to continue the successful execution of EQT’s proven cash flow plan.

Your vote is extremely important. It does not matter how many or how few shares you have. It does not matter whether or not you plan to attend the Annual Meeting. You have an opportunity to keep EQT on the best path forward and support EQT’s Board and management team by voting the GOLD universal proxy card. Please note, if you mark “FOR” for more than 12 individuals for the election of directors, all of your votes for the election of directors will be deemed invalid.

We urge you to vote today by telephone, internet or by signing, dating and returning the enclosed GOLD universal proxy card in the postage-paid envelope provided. Please discard and do NOT vote using any white proxy cards you may receive from the Rice Group.

Thank you for your continued support of EQT as we work to execute our strategy and drive value and significant cash flow for shareholders. We are building on our momentum and look forward to continuing to engage with all shareholders regarding the positive change underway and our progress in driving accelerated free cash flow growth.


The Independent Members of the EQT Board of Directors