EQT signs 10-year gas deals with Duke, Southern

Market: Electricity, Natural gas
11/06/25

US natural gas producer EQT has signed 10-year firm supply deals with US utilities Duke Energy and Southern Company for a combined 1.2 Bcf/d of gas beginning in 2027.

EQT previously disclosed it struck deals to sell 800mn cf/d and 400mn cf/d of gas to "investment-grade utilities" in the southeastern US, but it has not disclosed the buyers. Those previously unnamed utilities are North Carolina-based Duke, which has contracted for 800mn cf/d from EQT, and Georgia-based Southern, which has contracted for 400mn cf/d, according to people with knowledge of the matter.

EQT declined to comment for this story. Duke and Southern did not immediately respond to requests for comment.

The deals represent about 20pc of EQT's production and allow EQT to take advantage of contracted capacity it holds on Mountain Valley Pipeline, which ferries gas from West Virginia to Virginia. EQT, the second-largest US gas producer by volume, has been the owner of Mountain Valley Pipeline since acquiring its previous owner Equitrans Midstream in July 2024.

The gas supply deals are "two of the largest long-term physical supply deals ever executed in the North American natural gas market," EQT chief executive Toby Rice said in October 2023. The deals also underpin EQT's broader strategy of trying to sell more gas directly to large end users, including utilities, LNG export terminals and data centers, instead of selling into the volatile US spot gas market with the use of financial hedges. The deals also give EQT more exposure to pricing hubs in the southeastern US, where gas trades at a premium to gas sold within the Appalachian production region, where EQT operates.

For Duke and Southern, the long-term agreements guarantee available gas supply as the utilities convert coal-fired power generation facilities to gas-fired generators while scrambling to meet surging power demand from planned data centers running artificial intelligence software. Those drivers of gas demand are also behind US pipeline companies Williams, Kinder Morgan and Boardwalk Pipeline Partners trying to build out more gas transportation capacity into the southeast, FactSet manager of natural gas research Connor McLean told Argus. Duke Energy plans to add 5GW of new gas-fired power generation through 2029 across its territory, the company said earlier this month.

Duke Energy Carolinas and Southern Company hold most of the contracted capacity on Williams' planned 1.6 Bcf/d Southeast Supply Enhancement expansion of its Transcontinental (Transco) pipeline, which is expected to enter service in the fourth quarter of 2027, US Federal Energy Regulatory Commission filings show. That expansion project will make available new gas transportation capacity from the terminus of the Mountain Valley Pipeline in Virginia to end markets in Virginia, North Carolina, South Carolina, Georgia and Alabama. Duke Energy Carolinas, whose service territory includes North Carolina and South Carolina, holds 1 Bcf/d of contracted capacity on Southeast Supply Enhancement. Southern Company, whose service territory includes Georgia and Alabama, holds 400mn cf/d.

By selling into those regions, EQT will be taking 1.2 Bcf/d of gas it was previously selling into the comparatively low-priced Tetco M-2 market and selling it instead into the higher priced Transco zone 4 and 5 South markets. The spot price for gas in the Transco zone 5 South region — which covers gas downstream from compressor station 165 near the terminus of Mountain Valley Pipeline in Virginia to the Georgia-South Carolina border — in 2024 averaged $2.69/mmBtu, and the Transco zone 4 index — spanning Georgia, Alabama and Mississippi — averaged $2.41/mmBtu. The Tetco M-2 receipts index over the period averaged $1.67/mmBtu.

The supply deals with Duke and Southern are "the main driver" behind EQT's anticipated corporate gas price differential — or the average price at which it sells its gas relative to the US benchmark price — tightening to around 30¢/mmBtu in 2028 from an anticipated 60¢/mmBtu this year, EQT's Rice said in April.

EQT is also in talks with a dozen proposed power projects in the Appalachian production region, he said.

By Julian Hast

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