© 2024 KGOU
News and Music for Oklahoma
Play Live Radio
Next Up:
0:00
0:00
0:00 0:00
Available On Air Stations

Oklahoma City-Based Chesapeake Energy Sells $450M Worth Of Louisiana Assets

Signage at Chesapeake Energy's Oklahoma City campus.
Brian Hardzinski
/
KGOU

One of Oklahoma City's energy giants announced a sale of land leases and active oil wells in northern Louisiana on Tuesday. The move will bring in about $450 million.

Along with other liquidations, Chesapeake Energy has earned about $2 billion in sales this year so far.

Houston-based energy analyst Neal Dingmann told The Journal Record’s Sarah Terry-Cobo Chesapeake got a great deal, and the transaction is positive for the company.

The transaction covers 78,000 acres in northern Louisiana, about 40,000 of which were in a profitable area. The sale includes 250 wells producing about 30 million cubic feet of gas per day. The deal is expected to close in the first quarter, according to information Chesapeake released. The buyer is a private company and was not disclosed. Dingmann, energy research managing director for SunTrust Robinson Humphrey, said Chesapeake got a great price per acre. The sale price brings about $4,000 per acre, higher than the most recent sale by a peer, which brought about $3,000 per acre, Dingmann said.

Chesapeake has another parcel of oil-producing land nearby that’s up for sale but it’s expected to keep a large amount of acreage for itself in the most profitable part of Louisiana’s Haynesville Shale.

That transaction will also likely close in the first quarter of 2017. The company will retain about 250,000 acres in the most profitable part of that shale basin once both sales are closed. Employees and contractors are shifting their focus to drilling longer lateral wellbores and pumping more sand, water and chemicals during the hydraulic fracturing process. Chesapeake’s stock trades on the New York Stock Exchange under the symbol CHK. Shares initially rose during Monday’s trading to a high of $7.65 before closing the day at $7.48.

KGOU is a community-supported news organization and relies on contributions from readers and listeners to fulfill its mission of public service to Oklahoma and beyond. Donate online, or by contacting our Membership department.

More News
Support nonprofit, public service journalism you trust. Give now.