National Fuel Gas Plans To Separate Into Two Independent, Publicly Traded Companies Via Spin-Off Of Its Integrated Upstream And Gathering Business; Upon Completion, Shareholders Will Own Shares In Both NFG And IUG With NFG Retaining A 19.9% Stake In IUG

Transaction Details

National Fuel intends to separate IUG through a pro rata distribution of shares of IUG to National Fuel shareholders in a manner that is intended to be tax-free for National Fuel and its shareholders for U.S. federal income tax purposes. National Fuel expects to retain an ownership stake of up to 19.9% in IUG after the completion of the spin-off, which it intends to dispose of in a tax-efficient manner to further strengthen its investment grade balance sheet.

National Fuel expects to complete the separation during the second half of calendar year 2027, subject to customary conditions, including the filing and effectiveness of applicable filings (including a Form 10 registration statement) with the Securities and Exchange Commission, the completion of financing arrangements, and final approval by National Fuel’s Board of Directors.

The Company intends to provide formal guidance for fiscal 2027 in connection with its fourth quarter earnings release in November 2026. IUG will continue to be included in National Fuel’s consolidated financial results until the separation is completed.

As independent, focused entities, each publicly traded company will have significant scale and a strong financial profile, positioning each to deliver long-term growth and sustainable value creation for investors, customers, and employees. The stand-alone businesses are expected to benefit from:

Greater capital allocation flexibility to pursue each company’s distinct growth opportunities and shareholder return priorities, supported by highly experienced leadership teams, strong balance sheets, and more tailored capital structures.
Preserving the key benefits of integration that each business realizes today, including the capital efficiencies provided by IUG’s integrated upstream and gathering operations, and critical operating synergies that support customer affordability and commercial benefits across National Fuel’s regulated businesses.
Clearer, more compelling equity stories that increase visibility among investors and research analysts and align each public company with its natural investor base.

National Fuel: 100% regulated natural gas platform, with highly strategic, growing integrated utility and interstate pipeline and storage assets in constructive regulatory jurisdictions

Post-separation, National Fuel will be a fully regulated natural gas business with nearly $5 billion of rate base. National Fuel’s natural gas utilities serve 1.1 million customers across Ohio, New York and Pennsylvania, and its FERC-regulated pipeline and storage business will provide nearly 5 Bcf per day of contracted natural gas transportation capacity and 77 Bcf of fully contracted natural gas storage services.

Today, National Fuel operates across constructive regulatory jurisdictions, with significant long-term investment opportunities that are underpinned by ongoing infrastructure modernization programs in each jurisdiction. Additionally, increased natural gas demand, including data center and power generation needs within our operating footprint, is accelerating the need for new pipeline and storage infrastructure. Together, the importance of continually investing in safety and reliability, along with meeting increasing regional demand for natural gas, is driving a strong outlook for growth across these businesses.

National Fuel will continue to benefit from maintaining key operating synergies across its utility and FERC-regulated businesses. From a financial perspective, this business is expected to maintain a strong balance sheet, targeting investment grade credit metrics expected to be in line with some of the strongest in the utility sector, with no expected need to raise incremental equity capital over the next five years based on current capital plans. This will provide the company with significant financial flexibility to execute on its long-term growth opportunities. In addition, National Fuel plans to maintain a capital return policy consistent with utility peers.

The existing management teams at both the Utility and Pipeline and Storage businesses are also expected to remain in place, including David P. Bauer as President and Chief Executive Officer, and Timothy J. Silverstein as Treasurer and Chief Financial Officer. This provides National Fuel with the continuity of a highly experienced senior leadership team that has a proven track record of operating safely, maintaining strong regulatory relationships, and executing on its financial plans, all while maintaining customer rates among the lowest in its operating jurisdictions.

Taken together, these attributes are expected to provide National Fuel investors with a compelling risk-adjusted return proposition, underpinned by attractive, predictable growth, and stable cash flows which support a strong financial foundation.

Integrated Upstream and Gathering: A premier, integrated Appalachian natural gas business with high-quality assets, and top-tier inventory depth and capital efficiency trends

Post-separation, IUG will be a leading integrated, low-cost upstream natural gas business, with approximately 1.2 million total net acres in Appalachia and approximately 1.1 Bcf per day of net natural gas production. IUG's wholly owned gathering assets transport the vast majority of its production, creating a durable competitive advantage through lower costs, greater operating control, and enhanced capital efficiency. With approximately 5 Tcf of proved natural gas reserves, and more than 25 years of development inventory at very low breakeven prices, IUG is well positioned to build upon its top-tier capital efficiency trends and create long-term value through disciplined capital allocation.

Since transitioning its development program to its Eastern Development Area in 2023, IUG has delivered capital efficiency improvements of approximately 25%, enabling IUG to generate increased production and free cash flow per dollar invested. Combined with its integrated gathering platform and portfolio of firm transportation capacity that provides access to premium markets, IUG is expected to maintain a highly-competitive cash operating cost structure with market access advantages that support high cash margins and long-term value creation.

As an independent entity, IUG is expected to have a strong balance sheet, providing the flexibility to optimize capital allocation, efficiently develop its premier drilling inventory, and pursue targeted growth opportunities. IUG will continue to be led by its current team, including Seneca Resources and NFG Midstream President, Justin I. Loweth, who will become Chief Executive Officer of the new company. Maintaining the continuity of the experienced IUG leadership team will further enhance the company’s ability to deliver on its history of operational excellence. The combination of a more focused business model, an experienced management team, and a high-quality resource base positions IUG to execute its strategy from day one as an independent company.