Sorry no link since it was an email.May 5, 2008
Chesapeake Energy Corp., Oklahoma City, (NYSE: CHK) has retained Meagher Oil & Gas Properties Inc. to sell all of its remaining properties in the Arkoma Basin Woodford shale.
The package includes approximately 85,000 net acres in Hughes, Pittsburg, Coal and Atoka counties in Oklahoma. Production is approximately 40 million cubic feet equivalent per day. Potential net reserves are more than 2 trillion cubic feet equivalent. The sale is part of the company's plan to monetize assets to fund increased capex. Contact Teri Williams, 918-481-5900, ext. 224.
Chesapeake recently sold long-lived producing assets in Texas, Oklahoma and Kansas in its second volumetric production payment transaction to an undisclosed buyer for $622.7 million. Proved reserves are approximately 94.3 billion cubic feet equivalent to be produced over 11 years for $6.63 per thousand cubic feet. Current net production is approximately 47 million cubic feet per day.
Chesapeake is operator and will retain drilling rights on the properties below currently producing intervals. Combined, Chesapeake anticipates receiving more than $1.5 billion from the two transactions, making anticipated proceeds for the Oklahoma properties close to $900 million.
Sincerely,
Oil & Gas Investor's
A&D Watch
I am not sure what to think about this. Either Chesapeake is getting ready to do a huge capital investment somewhere (maybe Haynesville Shale) and they need to raise that capital or...the Woodford Shale isn't as great as many believed and Chesapeake is walking away while prices are relatively high.