Shares of Kinetik Holdings Inc. (KNTK) plunged 5.30% in pre-market trading on Thursday, despite the company announcing a significant long-term natural gas supply deal with INEOS Energy. The unexpected negative market reaction suggests investors may have concerns about the terms or timing of the agreement.

According to the announcement, Kinetik Holdings has signed a long-term agreement with INEOS Energy to supply natural gas to Europe starting from 2027. The deal specifies that Kinetik will deliver up to 0.5 million tonnes per annum (MTPA) of natural gas under this arrangement. This agreement marks a notable step for Kinetik in securing a long-term customer for its natural gas exports to the European market.

However, the stock's sharp decline indicates that investors might be apprehensive about certain aspects of the deal. Possible concerns could include the delayed start date of 2027, which is still several years away, or the specified volume cap of 0.5 MTPA, which some analysts might view as relatively modest. Additionally, the market may be reacting to undisclosed terms of the agreement or broader concerns about the long-term prospects of natural gas exports to Europe. As more details emerge, investors will likely scrutinize the potential impact of this deal on Kinetik Holdings' future revenue and growth prospects.