Chesapeake Energy's Asset Sales May Be Inflection Point

Tue, 02/22/2011 - 08:50 EDT - Seeking Alpha

Mike Maher submits:Chesapeake Energy (CHK) and BHP Billiton (BHP) announced yesterday that BHP will acquire all of Chesapeake's Fayetteville assets for $4.75 billion in cash. The assets represent 487,000 acres of leasehold and producing properties, pumping 415 million cubic feet of natural gas equivalent daily, plus the 420 miles of midstream pipelines servicing the area. Chesapeake will use the money to pay down debt. This sale furthers Chesapeake's plan to increase production and cut debt by 25% in the next two years, and should make investors take another look at Chesapeake. Chesapeake Energy is the second largest natural gas producer in the US, only trailing Exxon Mobil (XOM), which acquired XTO energy last year. The company produced 2.6 bcf/day of natural gas in the last quarter of 2010, with about 1.7 bcf/day of that natural gas coming from shale plays. The company has been the most active player in the shale gasComplete Story »

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Chesapeake Energy's Asset Sales May Be Inflection Point

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