Chesapeake Energy Corporation (CHK) - NYSE
  • Wed, Feb. 24, 12:45 PM
    • Chesapeake Energy (CHK +21.7%) agrees to sell its remaining Western Anadarko Basin oil and gas assets to privately-held FourPoint Energy for $385M.
    • The assets to be acquired include an interest in nearly 3,500 producing wells primarily in the Granite Wash, Missourian Wash, Upper and Lower Cleveland and Tonkawa formations in western Oklahoma and the Texas panhandle.
    • CHK has reversed early premarket losses, as its deals to divest $700M in gas fields and other assets and plans to sell $500M-$1B in additional assets this year allow it to pay off debt coming due in three weeks.
    • Seeking Alpha contributor Daniel Moore says CHK now has a lifeline into 2017 and possibly much longer but its long-term recovery remains linked to its ability to create a competitive cost structure.
    | Wed, Feb. 24, 12:45 PM | 12 Comments
  • Wed, Feb. 24, 9:21 AM
    | Wed, Feb. 24, 9:21 AM | 1 Comment
  • Wed, Feb. 24, 7:56 AM
    • Chesapeake Energy (NYSE:CHK) -4.1% premarket after swinging to a Q4 loss on less than half the revenue from the year-ago quarter, and announcing drastic capex cuts.
    • CHK is budgeting total FY 2016 capital spending of $1.3B-$1.8B, 57% less at the midpoint than its 2015 capex of $3.6B.
    • CHK says it expects to place 330-370 wells on production, resulting in total production that declines 0%-5% Y/Y, after adjusting for asset sales.
    • CHK also says it has signed agreements to divest $700M in gas fields and other assets, more than the $200M-$300M forecast provided in December, and plans another $500M-$1B in asset sales in 2016.
    • The asset sales may ease concern among bondholders and analysts that CHK was struggling under the weight of a debt burden that S&P recently described as “unsustainable.”
    • "In light of the challenging commodity price environment, our focus for 2016 is to improve our liquidity, further reduce our cost structure and address our near-term debt maturities to strengthen our balance sheet," CEO Doug Lawler says.
    • Update (8:09 am): CHK has turned around in volatile premarket action, now +7.3%.
    | Wed, Feb. 24, 7:56 AM | 23 Comments
  • Wed, Feb. 24, 7:04 AM
    • Chesapeake Energy (NYSE:CHK): Q4 EPS of -$0.16 beats by $0.01.
    • Revenue of $2.65B (-53.4% Y/Y) beats by $20M.
    • Press Release
    | Wed, Feb. 24, 7:04 AM | 93 Comments
  • Tue, Feb. 23, 5:30 PM
    | Tue, Feb. 23, 5:30 PM | 6 Comments
  • Mon, Feb. 22, 6:35 PM
    • Some analysts believe the merger of Williams Cos. (WMB, WPZ) and Energy Transfer Equity (ETE, ETP) is inching closer to fruition, after WMB said last week that it remains committed to the much-maligned deal.
    • Raymond James analyst Darren Horowitz believes the highest probability outcome remains that WMB and ETE continue with the previously agreed-upon merger terms, and that it is in management’s best interest to provide as much deal-related transparency as legally possible.
    • Rob Thummel, portfolio manager at Tortoise Capital, thinks more encouragement came from some reassurance on WMB's earnings conference call that the company is not overly exposed to the risk that Chesapeake Energy (NYSE:CHK), which provides about 18% of WMB's cash flow, could go bankrupt and stop making payments.
    • However, CTFN reports that January's $1B private placement of debt by WMB subsidiary Transcontinental Gas Pipe Line has led an investor to question the "limitation of guarantees” covenant as it may relate to the merger.
    | Mon, Feb. 22, 6:35 PM | 33 Comments
  • Mon, Feb. 22, 6:15 PM
    • Chesapeake Energy (NYSE:CHK) jumped 20% in today's trade for its biggest percentage gain since 2008, which Bloomberg credits in part to Giovanni DiMauro's Seeking Alpha article that called CHK a "prime takeout candidate."
    • Speculation that the heavily-indebted CHK may be headed for bankruptcy is unwarranted, a $500M note coming due in March likely will be repaid on time, and "could be swallowed up on the cheap by a player with deep pockets," DiMauro writes.
    • CHK’s 3.25% notes maturing next month have risen to $0.9545 on the dollar after posting a record one-day plunge to $0.84 on Feb. 8, Bloomberg adds.
    • CHK is scheduled to post Q4 financial results on Wednesday.
    | Mon, Feb. 22, 6:15 PM | 50 Comments
  • Mon, Feb. 22, 3:21 PM
    • Bernstein analyst Bob Brackett tags Chesapeake Energy (CHK +17%) and Encana (ECA +5.6%) as the E&P stocks that could cause the most pain for investors going forward.
    • CHK already has suffered plenty, but Brackett writes thinks it has the highest risk of bankruptcy in his coverage universe, and the current stock price "essentially shuts it out of the equity market,” while ECA is most likely to issue equity and see its credit rating cut to junk status.
    • Meanwhile, Brackett thinks EOG Resources (EOG +3.8%) is the safest play due largely to a returns-oriented culture and relative conservatism in the early part of this cycle, while ConocoPhillips (COP +4.4%) and Devon Resources (DVN +9%) already have made their big moves - a big dividend cut and an equity raise, respectively - which relieves the pressure on management to take further drastic steps.
    | Mon, Feb. 22, 3:21 PM | 43 Comments
  • Wed, Feb. 17, 5:47 PM
    • North Dakota's crude oil production fell in December for the first time in three months, down 2.5% to 1,152,280 bbl/day, as oil producers begin to acknowledging the low-price reality rolling over the entire energy industry.
    • Only 41 drilling rigs are operating in the state as of Wednesday, the lowest level since July 2009, and North Dakota producers have cut back requests to drill new wells, with only 78 permitted in January compared to 125 in November.
    • Bakken shale exposure includes: CLR, HES, WLL, STO, OAS, MRO, EOG, XOM, NOG, CHK, DNR, SM, NFX, OXY, MUR, OXY, COP, SSN, CXO, EOX
    | Wed, Feb. 17, 5:47 PM | 27 Comments
  • Tue, Feb. 16, 6:57 PM
    • George Soros, who has warned of a repeat of the 2008 financial crisis but this time with China as the focus of most problems, exited stakes in several energy-related companies and took a position in Pfizer (NYSE:PFE) during Q4.
    • According to a 13-F filing, the Soros fund disclosed it had exited stakes in Chevron (NYSE:CVX), Chesapeake Energy (NYSE:CHK) and NRG Energy (NYSE:NRG), and reduced its position in Dow Chemical (NYSE:DOW); Soros bought ~685K shares in Baker Hughes (NYSE:BHI), which is merging with Halliburton (NYSE:HAL), as well as 50.7K shares in Kinder Morgan (NYSE:KMI).
    • Soros also closed his stake in Olin Corp. (NYSE:OLN) and cut his stake in Vista Outdoor (NYSE:VSTO), and took a position valued at $216M in Synchrony Financial (NYSE:SYF), which was spun off from GE.
    • Overall, the value of Soros’ holdings fell to $6.05B as of Dec. 31, from $6.61B at the end of Q3.
    | Tue, Feb. 16, 6:57 PM | 53 Comments
  • Tue, Feb. 16, 6:16 PM
    • The Sierra Club is suing units of Chesapeake Energy (NYSE:CHK) and Devon Energy (NYSE:DVN), accusing the companies' fracking practices of causing tremors in Oklahoma and Kansas.
    • The group blames the practice of injecting liquid oil and gas waste into deep ground-wells for helping cause a spike of more than 5,800 earthquakes in Oklahoma in 2015, up from an annual high of 167 in the years from 1977 to 2009, according to the complaint filed in federal court in Oklahoma City.
    • Meanwhile, Oklahoma state regulators unveil their largest volume reduction plan yet for oil and gas disposal wells in western Oklahoma’s Arbuckle formation in response to increased numbers of earthquakes; the plan, along with an earlier reduction plan, will bring the total volume cutback for the entire area to more than 500K bbl/day, or ~40%.
    | Tue, Feb. 16, 6:16 PM | 41 Comments
  • Tue, Feb. 16, 9:13 AM
    | Tue, Feb. 16, 9:13 AM | 1 Comment
  • Fri, Feb. 12, 2:51 PM
    • Chesapeake Energy (CHK -7.3%) remains sharply lower even after a Bloomberg report that it is is planning to pay $500M of debt maturing in March, using a combination of cash on hand and other liquidity that may include its credit line.
    • CHK also is considering selling assets to shore up its capital so it can address more than $1B of debt coming due in 2017, according to the report.
    • Creditors are gearing up for negotiations over how to reorganize CHK's ~$10B debt load, and at least one group of unsecured bondholders is said to have hired advisers to help evaluate the company’s assets in the U.S.
    | Fri, Feb. 12, 2:51 PM | 72 Comments
  • Fri, Feb. 12, 8:31 AM
    • Chesapeake Energy's (NYSE:CHK) Sell rating is reiterated at UBS but with a $0.50 price target, cut from $2, seeing minimal value for the equity unless oil and gas rallies materially.
    • Assuming 2016 capex of less than $1B - which would mark a 70% Y/Y drop and well below consensus of $2.5B/yr - UBS projects a $1B/year free cash flow deficit; the firm also estimates CHK is on a path to chew through $3.9B of liquidity, and risks having its credit facility reduced and business impaired from under-investment.
    • UBS says asset sales would be challenged given that most shales are uneconomic at current prices, and that Williams Cos. is unlikely to renegotiate midstream contracts which are estimated to cost CHK ~$1.2B/year.
    | Fri, Feb. 12, 8:31 AM | 68 Comments
  • Thu, Feb. 11, 7:12 PM
    • Short interest as a percentage of float for the energy sector surpassed 12% at the end of January to its highest level in more than a decade, according to research from Bespoke.
    • Six of the eight most heavily shorted stocks among the S&P 500 resided in the energy sector, all with percentage of float levels exceeding 20%: Chesapeake Energy (NYSE:CHK), Transocean (NYSE:RIG), Southwestern Energy (NYSE:SWN) Diamond Offshore (NYSE:DO), Consol Energy (NYSE:CNX) and Helmerich & Payne (NYSE:HP).
    • GameStop (NYSE:GME) was the most heavily shorted stock in the S&P 500, Bespoke says.
    | Thu, Feb. 11, 7:12 PM | 34 Comments
  • Tue, Feb. 9, 7:39 PM
    • Chesapeake Energy’s (NYSE:CHK) problems illustrate the potential for a domino effect in U.S. pipeline companies, and threatens to shatter the assumption of many investors that the companies are insulated from plunging energy prices.
    • CHK has commitments to pay ~$2B/year for space on pipelines run by MLPs; Williams Cos. (WMB, WPZ) has the most exposure to CHK after buying the company's logistics assets for $6B in 2014
    • CHK's distress threatens the $33B Williams-Energy Transfer (ETE, ETP) tie-up announced last September, and has been a drag on WMB's credit rating, which could cause headaches for ETE if the merger goes through.
    • WMB likely will be forced to accept a 50% price cut in its contract price with CHK, either through the courts or mutual renegotiation - which would equal a drop of $300M in annual cash flow - says InfraCap portfolio manager Jay Hatfield.
    • Williams and Energy Transfer "would be way better off if they did not merge,” Hatfield says. “I can’t believe that both stocks wouldn’t rocket if the deal was called off.”
    • Other companies with CHK contracts include Spectra Energy Partners (NYSE:SEP), Columbia Pipeline Partners (NYSE:CPPL) and Marathon Petroleum's (NYSE:MPC) MPLX unit; a SEP spokesperson tells Reuters that its CHK contract to supply gas out of the Marcellus Shale accounted for less than 3% of its 2015 revenues.
    • Kinder Morgan (NYSE:KMI) has not disclosed its exposure to CHK.
    | Tue, Feb. 9, 7:39 PM | 59 Comments
Company Description
Chesapeake Energy Corp. is a natural gas and oil exploration and production company, which is engaged in the exploration, development and acquisition of properties for the production of natural gas, oil and natural gas liquids from underground reservoirs. It also provides substantial marketing,... More
Industry: Independent Oil & Gas
Country: United States