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Chesapeake Sells Remaining Midstream Assets for $2.16B
OKLAHOMA CITY -- Chesapeake Energy Corp. announced after the close of trading Tuesday that it has entered into a definitive agreement to sell most of its remaining midstream assets to Access Midstream Partners L.P. for $2.16 billion. These midstream assets are located primarily in the company’s Marcellus, Utica, Eagle Ford, Haynesville and Niobrara shale plays.
The transaction with Access includes new market-based gathering and processing agreements covering various acreage dedication areas and is expected to close by the end of 2012. Chesapeake is building the gas processing plant in Kensington, Ohio, in a partnership with EV Energy Partners and M3 Midstream LLC, both based in Houston. The first phase of the plant is expected to come online this spring.
Chesapeake recently completed the sale of other midstream assets in Oklahoma and Texas for approximately $175 million.
The company said it anticipates completing the sale of its remaining midstream assets by the end of the 2013 first quarter for $425 million, bringing the total of current and anticipated midstream asset sales to $2.75 billion.
Including the $2.125 billion of midstream asset sales completed in the second and third quarters, the proceeds from the company’s midstream exit are anticipated to total $4.875 billion.
Said Chesapeake’s CEO, Aubrey K. McClendon, in a prepared statement, “We are pleased to announce further progress towards our asset sale goals for 2012-2013. We look forward to completing additional asset sales and achieving our goals of strengthening our balance sheet, tightening our asset focus and increasing returns to shareholders.”
Jefferies & Company Inc. and Goldman, Sachs & Co. are serving as financial advisors to Chesapeake on its midstream transactions.
Published by The Business Journal, Youngstown, Ohio.
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