Deal Insight
Chesapeake Energy sells its Barnett Shale assets to Saddle Resources
*Please note that this report only includes an Excel data file if this is indicated in "What's included" below
Report summary
In lieu of proceeds, Saddle Resources will provide a lump sum payment to Williams Partners as settlement for terminating Chesapeake's midstream contracts in the Barnett. Together, Saddle Resources and Chesapeake will pay US$774 million to Williams Partners (US$334 million from Chesapeake, US$420 million from Saddle Resources) to terminate a 20-year gas gathering and shipping contract Chesapeake had entered into in 2012. Plagued by low commodity prices and liquidity concerns, Chesapeake is positioning the company to focus on its core strength - delineating, developing, and growing unconventional plays. The Barnett failed to attract capital within the company's portfolio due to onerous gathering and transportation contracts and declining production. This strategic move improves Chesapeake's medium-term liquidity, financial liabilities, and operational flexibility.
Table of contents
- Executive summary
- Transaction details
-
Upstream assets
- Modelling assumptions
-
Strategic rationale
- Chesapeake
- Saddle Barnett Resources LLC
- Williams Partners
- Oil & gas pricing and assumptions
Tables and charts
This report includes the following images and tables:
- Chesapeake in the Barnett
- Chesapeake's permit activity and IP (mmcfd) trend in Johnson and Tarrant Counties
- Oil & gas pricing and assumptions: Table 1
- Upstream assets: Table 1
- Chesapeake historical gas production in the Barnett by vintage year
- Upstream assets: Table 2
- Chesapeake's progress on reducing fees, debt, and liabilities
What's included
This report contains:
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