NorthAmOil: Chesapeake confirms Chief acquisition, announces PRB sale

Chesapeake Energy confirmed this week that it was buying privately owned Chief E&D holdings for about $2.5bn in cash and stock. The companies had been reported to be in advanced talks over a potential acquisition last week.
Additionally, Chesapeake said it had agreed to sell its assets in Wyoming’s Powder River Basin to Continental Resources for around $450mn in cash.
The transactions mean that Chesapeake will expand its position in Northeast Pennsylvania’s Marcellus shale. The Chief assets – and associated non-operated interests held by Tug Hill that Chesapeake has also agreed to acquire as part of the deal – consist of roughly 113,000 net acres (457 square km). The properties are forecast to produce 835mn cubic feet (24mn cubic metres) per day of gas over the first nine months of 2022.
The Powder River Basin assets that Chesapeake is selling consist of 172,000 net acres (696 square km) and 350 operated wells, with estimated output of 19,000 barrels of oil equivalent per day (boepd) in the fourth quarter of 2021. Crude and natural gas liquids accounted for roughly 58% of production from the properties.
The transactions represent the latest in a series of major moves for Chesapeake since its emergence from bankruptcy protection in February 2021. The company had tried to shift its focus from natural gas to oil prior to entering Chapter 11 bankruptcy protection, but following its emergence, it has pivoted back to natural gas.
Last year, it acquired Vine Energy for $615mn, boosting its footprint in Louisiana’s Haynesville shale gas play.