Sinopec acquires a 50% stake in Chesapeake's Mississippi Lime assets for US$1 bn
This is a good deal for Sinopec. The company gains a 50% share in 34 mboe/d of production at a cost US$60,000 'per flowing barrel' (below market average), plus 425,000 net acres of undeveloped land at effectively zero cost. Sinopec is already familiar with the play through its JV with Devon, and may now be in a position to transfer knowledge between its two operating partners. Furthermore, this is a 100% cash deal, and features no cost-carry period.We value the deal at US$1.35 ...