Shares in America's largest natural gas producer EQT Corp. slipped 5% on March 15 in the wake of the sudden resignation of EQT's CEO Steven Schlotterbeck for "personal reasons."
EQT shares closed for the day at $49.73 on twice the normal volume of trades after Schlotterbeck's resignation right at the opening bell.
Schlotterbeck, who engineered the $6.7 billion merger with neighboring Appalachian shale gas driller Rice Energy Inc., departs at the same time EQT is in the midst of rearranging its assets to better separate its midstream and upstream units. The company is also parceling out the newly acquired Rice Energy and Rice Midstream Partners LP's assets to either EQT or EQT Midstream Partners LP.
SunTrust Robinson Humphrey Inc., analyst Welles Fitzpatrick said the EQT simplification process will not be derailed by Schlotterbeck's departure.
"While the process of finding a new CEO will likely drive headlines, we would note that from a top level view the company's plans to deconsolidate its E&P business and combine its midstream businesses has largely already been set in motion," Fitzpatrick said. "The heavy lifting of folding in the acquired Rice Energy assets has already been accomplished, as such we would not expect a change in corporate direction."
Stepping back in to replace Schlotterbeck will be former EQT CEO David Porges, who retired about a year ago. While Schlotterbeck spearheaded the merger with Rice, Porges is the financial engineer who transformed Pittsburgh's gas utility company into an exploration and production powerhouse in the southwestern Marcellus Shale.
"With Mr. Porges only a year removed from the CEO position, we believe the hand off should be smooth," Fitzpatrick told his clients.
