Chesapeake Energy Corp. announced Monday that it is selling half of its acreage in northern Oklahoma’s oil-rich Mississippi Lime play to China’s Sinopec International Petroleum Exploration and Production Corp. for more than $1 billion.
Chesapeake will sell Sinopec half of its 850,000 acres in the play for $1.02 billion, the company announced Monday.
The two companies will split future exploration and development costs for that acreage, with Chesapeake serving as operator.
“We are excited to announce the execution of our Mississippi Lime joint venture with Sinopec, which moves us further along in achieving our asset sales goals and secures an excellent partner to share the capital costs required to actively develop this very large, liquids-rich resource play,” said Steven C. Dixon, Chesapeake’s chief operating officer.
Chesapeake has been selling assets since last year to close a funding gap between its income and operating costs.
The company, which is facing life without iconic founder Aubrey McClendon, sold more than $11 billion worth of assets to avert a cash crunch last year, with plans to raise as much as $7 billion that way in 2013.