Loaded with debt, Chesapeake Energy was never able to fully take advantage of the 900,000 acres of land it controlled in Ohio’s natural-gas rich Utica shale region.
That’s about to change.
Thursday’s announcement that Oklahoma City-based Chesapeake is selling its stake in the eastern Ohio region for $2 billion to Encino Acquisition Partners figures to result in more production from a better-financed company that can invest in the region.
“We can’t grow the investment as we like, and that makes it a strong candidate for divestiture,” said Doug Lawler, Chesapeake’s president and CEO.
Seth Brooks, an analyst with the website ShaleExperts.com, said the sale will benefit the region.
“It’s a good thing. You have Chesapeake going through a rationalization of its portfolio. They couldn’t go develop the asset the way they wanted to,” he said.
Matthew Hammond, executive vice president of the Ohio Oil and Gas Association, agrees.
“Chesapeake divesting its Utica shale assets in Ohio is a positive move for Chesapeake and creates a new opportunity for someone else to come in and continue to develop this resource and acreage,” he said.The rest of this article can be read by clicking here.
Connect with us on Facebook and Twitter!