Summary of Antero Midstream and Antero Resources Corporate Update Call Company Overview - **Companies Involved**: Antero Midstream (NYSE: AM) and Antero Resources (AR) - **Date of Call**: December 08, 2025 Key Transactions - **Acquisition**: Antero Resources is acquiring West Virginia Marcellus assets for **$2.8 billion** and Antero Midstream is acquiring midstream assets for **$1.1 billion** [3][4] - **Divestiture**: Antero Resources is divesting non-core Ohio Utica assets for **$800 million** and Antero Midstream is divesting midstream assets for **$400 million** [3][4] - **Total Assets Acquired**: 385,000 net acres and approximately 850 million cubic feet per day (MMcf/d) of production [3][4] Strategic Rationale - The acquisition is aligned with Antero's existing operations, adding over **400 drilling locations** in the Marcellus core, with **75%** being liquids-rich [4][18] - Estimated synergies of approximately **$950 million** achievable through cost savings and operational efficiencies [4][10] - The acquisition is expected to reduce the cost structure by approximately **$0.25 per thousand cubic feet equivalent (MCFE)** and increase margins by **$0.15-$0.20 per MCFE** [4][18] Financial Overview - **Financing**: The acquisition will be financed through expected free cash flow of approximately **$500 million** and proceeds from the divestiture of non-core assets [5][6] - **Debt Management**: A three-year term loan will be utilized, with a focus on paying it off using hedged free cash flow from the acquired assets [5][6] - **Production Outlook**: Post-acquisition, the maintenance production target for 2026 is projected to be approximately **4.2 billion cubic feet equivalent (BCFE)** per day [7][18] Operational Synergies - Identified synergies include: - **Drilling and Completion Cost Savings**: Estimated at **$500 million** over ten years [10][28] - **Marketing Synergies**: Expected to improve price realizations and lower net marketing expenses by **$140 million** over ten years [10][28] - **Water Handling Savings**: Resulting from integration into Antero Midstream's water system [10][28] Production and Capital Expenditure - The pro forma maintenance capital target is expected to increase to approximately **$900 million** [7][18] - Potential for increased production through additional capital investment, with a one-to-one increase in net production for every **$100 million** invested [7][18] Market Position and Future Outlook - Antero is positioned as the leading operator in West Virginia, now producing over **50%** of the state's total production [41][18] - The acquisition enhances Antero's ability to capitalize on local gas demand, particularly from data centers and power generators [22][41] - The company maintains a commitment to low debt levels and expects to reaffirm investment-grade ratings [12][13] Conclusion - The strategic transactions are expected to significantly enhance Antero's operational efficiency, cash flow outlook, and market position in the Marcellus region, while also providing a pathway for future growth and shareholder returns [14][18]