Chesapeake Energy Corp. is getting closer to its 2013 fundraising goal.
Chesapeake will receive about 90 percent of the proceeds from the deal in cash at closing to help alleviate its cash crunch.
“Today’s announcement brings our year-to-date asset sales signed or closed to approximately $3.6 billion, which, combined with forecasted net operating cash flow, enables Chesapeake to fully fund its 2013 capital expenditure budget,” CEO Doug Lawler said. “Additional asset sales contemplated for later this year may reduce long-term debt and further enhance our financial liquidity.”
Chesapeake has been selling assets for much of the past two years to pay off debt and fill a budget shortfall.
The company has said it hopes to bring in as much as $7 billion this year.
On Wednesday, Chesapeake said it has agreed to sell EXCO about 55,000 acres in the northern part of the oil-rich Eagle Ford play in south Texas and about 9,600 acres in Louisiana’s Hayneville Shale. EXCO already operates 42 of the 53 units in the Louisiana acreage.
“These acquisitions are consistent with our strategy of targeting opportunities in both existing core areas and new plays,” EXCO CEO Douglas H. Miller said. “The Eagle Ford acquisition establishes our position in the high value oil core area of the Eagle Ford shale, and delivers immediate production and reserve additions, significant resource potential, and solid economic returns. The Haynesville acquisition adds to our leading core position and provides an expanded platform to apply our technical expertise, best-in-class drilling and completion focus, and project execution skills.”