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Oklahoma City, OK, United States

Chesapeake Energy is a public, American oil and natural gas company headquartered in Oklahoma City, United States. Chesapeake Energy is the second-largest natural gas producer in the United States. Its operations are focused on discovering and developing unconventional natural gas and oil fields onshore in the U.S. Chesapeake owns leading positions in the Eagle Ford, Utica, Granite Wash, Cleveland, Tonkawa, Mississippi Lime and Niobrara unconventional liquids plays and in the Marcellus, Haynesville/Bossier and Barnett unconventional natural gas shale plays. The company also owns substantial marketing and oilfield services businesses through its subsidiaries Chesapeake Energy Marketing, Inc. and Chesapeake Oilfield Services, L.L.C. Wikipedia.


The origin of thermogenic natural gas in the shallow stratigraphy of northeastern Pennsylvania is associated, in part, with interbedded coal identified in numerous outcrops of the Upper Devonian Catskill and Lock Haven Formations. Historically documented and newly identified locations of Upper Devonian coal stringers are shown to be widespread, both laterally across the region and vertically throughout the stratigraphic section of the Catskill and Lock Haven Formations. Coal samples exhibited considerable gas source potential with total organic carbon as high as 44.40% by weight, with a mean of 13.66% for 23 sample locations analyzed. Upper Devonian coal is thermogenically mature; calculated vitrinite reflectances range from 1.25% to 2.89%, with most samples falling within the dry-gas window. Source potential is further supported by gas shows observed while drilling through shallow, identifiable coal horizons, which are at times located within fresh groundwater aquifers. Thermogenic gas detected in area water wells during predrill baseline sampling is determined not only to be naturally occurring, but also common in the region. ©2014. The American Association of Petroleum Geologists.


Cullen A.,Chesapeake Energy Co.
Marine and Petroleum Geology | Year: 2014

A key consideration in tectonic models for SE Asia and opening of the South China Sea is the role that the West Baram and Tinjar Lines of NW Borneo may have played in accommodating the motion of crustal blocks displaced from Asia following India's collision. There are few studies that focus on these "lines". Using onshore geological studies and offshore seismic data to address the origin and tectonic significance of these, this paper concludes that rather than a major transform boundary between Luconia and the Dangerous Grounds, the West Baram Line marks the boundary between domains of continental crust that underwent differential extension in the Eocene. The Baram Basin is underlain by hyperextended continental crust on the NE side of the Baram Line. The strong contrast in the geological features across the Tinjar and West Baram Lines likely reflects ancient differences in crustal rheology with Luconia being the more rigid block. Although lack of significant strike slip faulting along the West Baram Line poses problems for tectonic models in which a wide proto-South China Sea is subducted beneath NW Borneo, intra-plate deformation, such as partial inversion of the Dangerous Grounds rift, offers a potential mechanism to mass balance blocks displaced from Asia with the reduced strike slip motion along the West Baram Line. © 2014 Elsevier Ltd.


Cullen A.,Chesapeake Energy Co.
Marine and Petroleum Geology | Year: 2014

A key consideration in tectonic models for SE Asia and opening of the South China Sea is the role that the West Baram and Tinjar Lines of NW Borneo may have played in accommodating the motion of crustal blocks displaced from Asia following India's collision. There are few studies that focus on these "lines". Using onshore geological studies and offshore seismic data to address the origin and tectonic significance of these, this paper concludes that rather than a major transform boundary between Luconia and the Dangerous Grounds, the West Baram Line marks the boundary between domains of continental crust that underwent differential extension in the Eocene. The Baram Basin is underlain by hyperextended continental crust on the NE side of the Baram Line. The strong contrast in the geological features across the Tinjar and West Baram Lines likely reflects ancient differences in crustal rheology with Luconia being the more rigid block. Although lack of significant strike slip faulting along the West Baram Line poses problems for tectonic models in which a wide proto-South China Sea is subducted beneath NW Borneo, intra-plate deformation, such as partial inversion of the Dangerous Grounds rift, offers a potential mechanism to mass balance blocks displaced from Asia with the reduced strike slip motion along the West Baram Line. © 2013 Published by Elsevier Ltd.


News Article | September 29, 2015
Site: fortune.com

Chesapeake Energy CHKDJ cut 740 jobs on Tuesday in the latest bout of energy company layoffs. The loss of jobs amounts to 15% of its total workforce, according to The Oklahoman. The company, which is headquartered in Oklahoma, will give employees 13 to 52 weeks of pay based on experience. It will also offer job placement help. “The commodity price environment is extremely challenging for our entire industry,” CEO Doug Lawler in an interview with The Oklahoman. “Chesapeake today has had to take some steps towards improving our financial position to meet these challenging times. This is something we are not happy about.” “These are individuals who have contributed substantially to the success of the company, but the current commodity price environment and stability of the company requires we take action,” Lawler added. The company now has about 4,000 employees globally. “This company will be an enduring enterprise,” said Lawler. “We are committed to the community, and we are committed to Oklahoma. But we have to react and respond to be as competitive as possible.” Fortune reported on other energy company layoffs, including Halliburton, earlier this year due to the plunging price of oil.


News Article | April 8, 2015
Site: www.bloomberg.com

Chesapeake Energy Corp. was nursing hopes of investment-grade credit ratings just a few months ago. Now, debt investors’ confidence is slipping away as onerous pipeline contracts and slumping commodity prices crimp its profit. A gauge of the company’s credit risk has deteriorated to a level not seen since the departure of former Chief Executive Officer Aubrey McClendon in 2013 as shareholders revolted over his personal stakes in company wells. The shale-gas company is at risk of violating a loan agreement with its bankers this year, which would limit access to a $4 billion credit line at the same time analysts expect earnings to drop. Sentiment has soured on the Oklahoma City-based producer as the collapse in energy prices during the past eight months has made its $11.5 billion of debt more vulnerable to deals struck under McClendon the negative effects of which become increasingly exaggerated as energy prices fall. Chesapeake had been trying to boost its credit quality by cutting borrowings and shifting toward more profitable crude oil production. “We thought that investment grade was going to be within striking distance, but now the wind has been taken out of the sail,” Brian Gibbons, a senior analyst at CreditSights Inc, said in a telephone interview. “The move down in oil and gas prices is more than compensating for the company’s internal improvements.” Chesapeake must maintain leverage -- measured by its ratio of debt to earnings before interest, taxes, depreciation and amortization -- of below four times to remain in compliance with its loan terms. Phil Adams, an analyst at debt researcher Gimme Credit, predicts leverage may climb to 4.1 times by the end of the year and changed his outlook on Chesapeake bonds to “underperform” in a report last month. “It’s going to be a little tight for them to remain below the ratio by year end if things continue to deteriorate,” Adams said in an interview. The U.S. natural gas producer has been hamstrung as a glut of North American supply has pushed prices below $3 per million British thermal units so far this year, dropping more than a third from its 2014 average of $4.26. Its shift toward crude oil production has also been hurt by the more than 50 percent plunge in the price of that commodity from its 2014 peak. If gas prices stay below $3 and oil remains around $50 over the next 18 months, Chesapeake will “blow through that leverage requirement,” according to James Sullivan, an analyst at research firm Alembic Global Advisors in New York. “They would have to boost liquidity again and the cupboard is pretty bare.” Since succeeding McClendon as CEO, Doug Lawler, has focused on raising cash through asset sales and untangling complex financial structures favored by his predecessor. Those instruments included preferred-share payouts and overriding royalty interests for investors in individual gas fields, as well as promises of future fuel deliveries in exchange for up-front cash for drilling. Despite Lawler’s efforts, Chesapeake’s outlook is dragged down by its debt load and the pipeline deals it inherited from prior management, Bank of America Corp. analyst Doug Leggate wrote in a report last week. He estimates the gas producer’s Ebitda will decline almost 50 percent to $2.7 billion this year, and that cash on hand will be more than halved to below $2 billion. Analysts have revised the company’s Ebitda forecast for the first quarter down 25 percent in the last two months to $774.5 million, Bloomberg data show. The pipeline contracts left the company on the hook for paying to transport a minimum level of product, whether or not it actually needed to. Chesapeake has to keep paying to honor that commitment even as its actual output declines, Alembic Global’s Sullivan said. “The issue with it was that they contemplated utilizing more capacity than they probably will,” Sullivan said. Credit-default swaps protecting against a default by the company for five years climbed to more than 400 basis points this week, the highest level since April 2013 when McClendon exited the company, according to data provider CMA, which is owned by McGraw Hill Financial Inc. and compiles prices quoted by dealers in the privately negotiated market. That means investors had to pay $400,000 a year to protect $10 million of debt for five years. Chesapeake’s debt is rated BB+ by Standard & Poor’s and an equivalent Ba1 by Moody’s Investors Service, the top tiers of high-yield, high-risk -- or junk -- debt at each of the credit-rating firms.

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