Chesapeake Energy Corporation Announces $1.02 Billion Mississippi Lime Joint Venture
Chesapeake Energy Corporation (NYSE:CHK) and Sinopec International
Petroleum Exploration and Production Corporation (Sinopec) today
announced the execution of an agreement which provides for Sinopec to
purchase a 50% undivided interest in 850,000 of Chesapeake′s net oil and
natural gas leasehold acres in the Mississippi Lime play in northern
Oklahoma (425,000 acres net to Sinopec). The total consideration for the
transaction will be $1.02 billion in cash, of which approximately 93%
will be received upon closing. Payment of the remaining proceeds will be
subject to certain customary title contingencies. Production from these
assets (including Mississippi Lime and other formations), net to
Chesapeake′s interest and prior to Sinopec′s purchase, averaged
approximately 34 thousand barrels of oil equivalent per day in the 2012
fourth quarter and, as of December 31, 2012, there was approximately 140
million barrels of oil equivalent of net proved reserves associated with
the assets. All future exploration and development costs in the joint
venture will be shared proportionately between the parties with no
drilling carries involved. As the operator of the project, Chesapeake
will conduct all leasing, drilling, completion, operations and marketing
activities for the joint venture. The transaction is anticipated to be
completed in the 2013 second quarter.
Steven C. Dixon, Chesapeake′s Chief Operating Officer, said, 'We are
excited to announce the execution of our Mississippi Lime joint venture
with Sinopec, which moves us further along in achieving our asset sales
goals and secures an excellent partner to share the capital costs
required to actively develop this very large, liquids-rich resource
play.?
Chesapeake Energy Corporation (NYSE:CHK) is the second-largest
producer of natural gas, a Top 11 producer of oil and natural gas
liquids and the most active driller of new wells in the U.S.
Headquartered in Oklahoma City, the company's operations are focused on
discovering and developing unconventional natural gas and oil fields
onshore in the U.S. Chesapeake owns leading positions in the Eagle Ford,
Utica, Granite Wash, Cleveland, Tonkawa, Mississippi Lime and Niobrara
unconventional liquids plays and in the Marcellus, Haynesville/Bossier
and Barnett unconventional natural gas shale plays. The company has also
vertically integrated its operations and owns substantial marketing and
oilfield services businesses through its subsidiaries Chesapeake Energy
Marketing, Inc. and Chesapeake Oilfield Operating, L.L.C. Further
information is available at www.chk.com
where Chesapeake routinely posts announcements, updates, events,
investor information, presentations and news releases.
This news release includes 'forward-looking statements' that give
Chesapeake's current expectations or forecasts of future events.Although
we believe the expectations and forecasts reflected in our
forward-looking statements are reasonable, we can give no assurance they
will prove to have been correct.They can be affected by
inaccurate assumptions or by known or unknown risks and uncertainties,
and actual results may differ from the expectation expressed.The
Sinopec sale transaction is subject to closing conditions and may not be
completed in the time frame anticipated. Following the closing,
Chesapeake may not be able to satisfy all the requirements necessary to
receive the sale proceeds subject to title contingencies. We caution you
not to place undue reliance on our forward-looking statements, which
speak only as of the date of this news release, and we undertake no
obligation to update this information.
Chesapeake Energy Corporation
Jeffrey L. Mobley, CFA, 405-767-4763
jeff.mobley@chk.com
or
Gary T. Clark, CFA, 405-935-6741
gary.clark@chk.com
or
Media
Contacts:
Michael Kehs, 405-935-2560
michael.kehs@chk.com
or
Jim
Gipson, 405-935-1310
jim.gipson@chk.com
