Range Resources Stock Surges 16% as EQT Agrees to All-Stock Merger Creating $50 Billion US Natural Gas Giant

Range Resources Corp. shares jumped more than 16% on Monday. EQT Corp., the largest natural gas producer in the United States, agreed to buy its Appalachian rival in an all-stock deal that creates a combined company with an enterprise value of more than $50 billion.

Range shares rose $7.42, or 16.31%, to $52.94 in morning trading on the New York Stock Exchange, a new 52-week high. More than 6.4 million shares had changed hands, about 2.5 times the three-month daily average. The gain lifted Range's market value to about $12.4 billion.

The stock is up about 22% over the past year.

EQT shares fell in early trading, according to market reports. Investors in an acquiring company often sell on news of a large purchase.

Deal terms

Under the agreement, both companies' boards unanimously approved the deal. Range shareholders will receive 0.987 EQT shares for each Range share they own. After the deal closes, EQT shareholders will own about 73% of the combined company and Range shareholders about 27%.

The companies did not disclose an implied price per share or a premium in their announcement.

The combined company will:

Produce more than 9 billion cubic feet equivalent of natural gas a day, net. Hold nearly 3 million net acres and more than 30 years of drilling inventory. Operate more than 3,700 miles of midstream pipeline and gathering infrastructure.

The companies expect $325 million in annual savings within two years, with a long-term path to more than $600 million. They estimated about $20 billion in cumulative free cash flow over five years at recent futures prices. They also said the combined company could break even on unlevered free cash flow with natural gas below $2 per million British thermal units.

EQT's management team will run the combined company, which will keep its headquarters in Canonsburg, Pennsylvania. Two Range representatives, including Range Chief Executive Dennis Degner, will join EQT's board.

The companies expect the deal to close in the first quarter of 2027, subject to regulatory approvals and votes by both companies' shareholders.

Executives' comments

"This transaction brings together two of the highest-quality, longest-duration asset bases in North America," EQT Chief Executive Toby Rice said in a statement.

"Our Board of Directors unanimously determined that this transaction will enhance Range shareholders' ability" to benefit from the combined company, Degner said. He cited a "constructive long-term natural gas and NGL macro outlook," referring to natural gas liquids.

Gas industry consolidation

The deal continues a wave of consolidation in U.S. shale. Producers have been combining to cut costs, extend drilling inventory and gain scale as they prepare for growing demand.

Both companies operate mainly in the Marcellus Shale of Pennsylvania and neighboring states, the most prolific natural gas basin in the country. Range, based in Fort Worth, Texas, was one of the pioneers of Marcellus development.

Analysts expect U.S. natural gas demand to rise in the coming years, driven by new liquefied natural gas export terminals on the Gulf Coast and electricity demand from data centers built for artificial intelligence. Appalachian producers are positioned to supply power plants and pipelines heading to the East Coast and Southeast.

EQT has expanded aggressively in recent years, including through its acquisition of Equitrans Midstream, which gave it control of major pipeline assets. The Range deal would add a large, low-cost acreage position next to its existing operations.

Energy markets

The deal comes as global energy markets remain volatile. Oil prices have risen sharply this year because of conflict in the Middle East and attacks on shipping in the Strait of Hormuz. Brent crude was trading near $115 a barrel on Monday.

Natural gas prices have been less affected by Middle East supply disruptions. But they have been supported by strong export demand for U.S. LNG.

Investors will be watching for any regulatory scrutiny of the deal, given the combined company's size in the Appalachian basin. They will also watch the shareholder votes expected early next year.