Energy
Chesapeake Will Take a Charge and Issue Debt (CHK)
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After the market closed yesterday, Chesapeake Energy Corporation (NYSE:CHK) announced that it would take a $1.8 billion non-cash, after-tax impairment charge, nearly all of which is allocated to the company’s oil and gas properties. Chesapeake also noted that it increased its proved reserves by about 11% since the end of 2007.
The company sold about 740 billion cubic feet equivalent of naturalgas, and produced about 834 billion cubic feet equivalent. Net newproved reserves totaled 2.8 trillion cubic feet equivalent, bringingthe company’s total proved reserves to about 12.1 trillion cubic feetequivalent.
In a separate announcement, Chesapeake said that it was offering $500million worth of senior notes due in 2015. The company plans to use theproceeds to pay down its revolving credit facility, "which itanticipates reborrowing from time to time to fund drilling andleasehold acquisition initiatives and for general corporate purposes."
We’ve already noted buyout rumors aroundChesapeake. Looks the company is adding a little nail polish andlipstick.
Paul Ausick
January 28, 2009
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