Energy

Total Cuts Natural Gas Investments, Chesapeake Shares Hit

Drilling rig
Thinkstock
In January 2010, France’s supermajor oil & gas company Total SA (NYSE: TOT) paid about $2.25 billion for a 25% stake in the Barnett shale leases owned by Chesapeake Energy Corp. (NYSE: CHK). The French company liked the deal so much that two years later it paid Chesapeake $2.3 billion for a similar-sized stake in the U.S. company’s Utica shale operations.

In 2010, natural gas prices were around $6 per million BTUs, compared with around $3.20 today. And that has led Total’s CEO to declare today that the French firm will make no new investments in the dry gas shale plays. Saying the investment “does not work,” website Upstream Online cited CEO Christophe de Margerie:

I see no point in investing … where there is no profitability. The fields are still there, the permits are still valid and production will restart when gas prices return to above cost levels.

Shares of Chesapeake are down more than 3.6% on the news, at $16.45 in a 52-week range of $13.32 to $26.09.

Want to Retire Early? Start Here (Sponsor)

Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?

Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.

Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.

 

Have questions about retirement or personal finance? Email us at [email protected]!

By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.

By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.