Chesapeake Announces $1B JV with Chinese Company
OKLAHOMA CITY – Chesapeake Energy Corp. announced Monday a joint venture with Sinopec International Petroleum Exploration and Production Co. that calls for the Chinese company to buy 50% of Chesapeake's stake in the Mississippi Lime basin for $1.02 billion in cash.
Under the agreement, Sinopec would acquire 425,000 of Chesapeake's 850,000 leasehold acres in the Mississippi Lime play in northern Oklahoma.
“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 develop this very large, liquids-rich play," Chesapeake chief operating officer Steven Dixon said in a prepared statement.
The joint venture is expected to close by the second quarter, the company reported.
Chesapeake reported that the Mississippi Lime play yielded an average of approximately 34,000 barrels of oil equivalent per day in fourth quarter. As of Dec. 31, there were approximately 140 million barrels of oil equivalent of proven net reserves in the basin, the company noted.
Chesapeake is looking to sell between $4 billion and $7 billion in assets this year, the company reported.
Published by The Business Journal, Youngstown, Ohio.
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