Natural gas provider,
Chesapeake Energy Corporation
) has disposed 57,275 net acres and 11 producing wells in the
Woodbine/Eagle Ford play in East Tex., to privately owned Energy
& Exploration Partners, Inc. The buyer is an independent
exploration and production company based in Fort Worth, Tex.
The Woodbine/Eagle Ford region in East Texas is a prolific
unconventional resource play containing a number of prospective
targets. These include the Woodbine sandstone, Eagle Ford shale
and Lower Cretaceous formations of the Buda, Georgetown, Edwards
and Glen Rose.
The sale of these assets is in line with Chesapeake's strategy to
reduce its long-term debt by monetizing its assets and cutting
lease-hold spending. At the end of fourth quarter 2012, the debt
balance stood at $12.2 billion, representing a
debt-to-capitalization ratio of 40.5%.
Earlier this month also, Chesapeake sold proven reserves and
undeveloped leasehold interests in Kingfisher and Canadian
counties, Okla. to Houston-based energy company
Gastar Exploration Limited
) for $75.2 million.
The asset disposals by Chesapeake are mainly aimed at reining in
debt as well as filling the funding gap for its mounting expenses
in the wake of continued low natural gas prices.
Natural gas accounted for about 77% of Chesapeake's fourth
quarter 2012 production, making results vulnerable to
fluctuations in the natural gas market. Chesapeake is the
second-largest producer of natural gas in the U.S. after
Exxon Mobil Corporation
Chesapeake is scheduled to release its first quarter 2013
earnings results on May 1, before the opening bell. The Zacks
Consensus Estimate for the first quarter is pegged at 23 cents,
representing a year-over-year growth of 28.8%.
Chesapeake currently retains a Zacks Rank #2 (short-term Buy
Range Resources Corporation
), another big player in the oil and gas industry, is also a
Zacks Ranked #2 stock.
CHESAPEAKE ENGY (CHK): Free Stock Analysis
GASTAR EXPL LTD (GST): Free Stock Analysis
RANGE RESOURCES (RRC): Free Stock Analysis
EXXON MOBIL CRP (XOM): Free Stock Analysis
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