Chesapeake Asset Sales

Brian Hicks

Written By Brian Hicks

Posted August 8, 2012

Chesapeake Energy Corp. (NYSE: CHK) has been embattled for some time; the company has a $10 billion deficit this current year in addition to regulatory problems unleashed by several Reuters investigations.

However, their second-quarter results, released Monday, suggest that the company may be able to pull through relying on increased crude production and sales of assets.

The company is about to close three deals in West Texas later this year. In the first half of this year, Chesapeake sold $4.7 billion, and it is looking at another $7 billion in sales to be announced by the year’s end. All this news caused company shares to rise around 3 percent after normal trading closed on Monday. It was up an additional 3.1% to $19.97 on Wednesday afternoon.

The domestic oil glut has caused low natural gas prices for a while, which has hurt the company’s bottom line. However, second quarter reports indicated Chesapeake’s oil and natural gas liquids production was up by almost 65 percent, with more increases to come.

From Reuters:

“Overall, I would say the quarter probably wasn’t as bad as people thought,” said Mark Hanson, an energy analyst at Morningstar. “You’ve got liquids production going up, which is a sign that they are aggressively going after them. That could be the influence of Icahn.”

Earlier Reuters investigations into Chesapeake’s operations proved troublesome for the company when the SEC and Department of Justice decided to keep a close eye on them.

At the end of June, Chesapeake claimed reserves of up to 17.4 trillion cubic feet, which is lower by almost 7 percent from the same time last year, Reuters says. The quarter’s profit was $929 million, or $1.29 a share. This is an improvement from the previous year’s 68 cents per share going rate. Revenues were also up to $3.4 billion compared to the previous year’s $3.3 billion.

It is expected that Chesapeake asset sales will amount to roughly $14 billion for the year.

Angel Publishing Investor Club Discord - Chat Now

Brian Hicks Premium

Introductory

Advanced

Even Amazon is Investing in Nuclear

Amazon, the global e-commerce powerhouse, is gearing up for a groundbreaking energy revolution. Teaming up with three leading nuclear company, they're making waves with an innovative plan to utilize nuclear energy using Small Nuclear Reactors (SMRs) . The e-commerce giant signed three deals for SMR development in Virginia. We reveal the names and ticker symbol of the company they're partnering with in our FREE report, "Even Amazon Is Investing in Nuclear." This news could make their share price sky rocket at any moment! Sign up below to get your free copy delivered to your inbox right away.

Sign up to receive your free report. After signing up, you'll begin receiving the Energy and Capital e-letter daily.