Regulatory Approval Paves Way for Enhanced EQT Pipeline Capacity

The Federal Energy Regulatory Commission (FERC) has granted a crucial approval for modifications to the Southgate extension of the Mountain Valley Pipeline (MVP). This decision represents a significant step in EQT Corporation's strategy following its acquisition of Equitrans Midstream last year, directly enabling plans for increased natural gas transportation to the southeastern United States.

FERC's authorization centers on a redesigned, more efficient project plan. The approved changes include a substantial boost in daily capacity to 550,000 dekatherms (Dth/d), up from the initially planned 375,000 Dth/d. This enhanced capacity is specifically intended to meet rising demand in markets like North and South Carolina. Concurrently, the pipeline route has been significantly shortened to 31.3 miles, a reduction from approximately 75 miles. This streamlined path is expected to lower both capital requirements and environmental impact. To facilitate the greater flow volumes, the commission has approved the use of larger 30-inch diameter pipes.

For EQT, the July 2024 takeover of Equitrans Midstream was a move toward greater vertical integration. This regulatory green light provides a tangible example of the potential synergies between production assets and transportation infrastructure. In its review, FERC noted competing projects, such as the Williams Companies' Southeast Supply Enhancement Project. The approval for the Southgate amendment is seen as strengthening the competitive position of the Equitrans subsidiary within this landscape.

Should investors sell immediately? Or is it worth buying Equitrans Midstream?

Market Reaction and Future Milestones

Investors responded favorably to the news, with EQT's share price appreciating on reduced regulatory uncertainty. The main segment of the Mountain Valley Pipeline commenced operations in mid-2024, and clarity on the Southgate extension complements that existing infrastructure.

While the FERC certificate provides federal-level approval, the project's realization remains contingent on state-level permits. The Virginia Department of Environmental Quality (DEQ) is anticipated to rule on necessary water quality certifications by February 2026. In parallel, the separate "MVP Boost" project, aimed at increasing the mainline's capacity, is progressing. Public hearings concerning related air permits are scheduled for spring 2026. Securing these DEQ and air quality approvals will be the next critical milestones. Once obtained, EQT would be positioned to utilize the expanded Southgate capacity to serve growing utility and data center demand in the Carolinas.