Chesapeake Seeks Asian Investors

Chesapeake Energy is looking for Asian investors, particularly in China, according to the WSJ, to invest in its multibillion-dollar gas projects.

The Chinese already have billions of dollars worth of investments from the likes of BP and Statoil, which have been mutually beneficial.  Chesapeake can use the money to grow in the US and as we've seen already in South Africa, in it's rather surprising first overseas foray it can leverage the relationship in the US to explore internationally.

Chesapeake, one of the pioneers in opening up vast new reserves of natural gas in the U.S., has been talking to Chinese oil firms about buying as much as 20% of its Eagle Ford field in Texas, Chief Financial Officer Marcus Rowland said Thursday in Beijing.  Rowland estimates the total cost of the project could be $4 billion USD.

Chesapeake is also talking to investors about buying as much as a 10% stake in the Marcellus shale-gas field in the Eastern U.S.

Mr. Rowland didn't specify in which other Asian countries Chesapeake is seeking partners. He said Oklahoma City, Okla.-based Chesapeake hopes to announce a deal before the end of the year.

Any deal with a Chinese company would likely involve training Chinese oil engineers, he said.  And although Chinese engineers have been in Oklahoma since 2008, the continuing changes in shale, which have made the economics of shale improve as much over time as the size of the gas discoveries means that Chinese, or Italian, or Norwegian or French engineers, for example, need to update skills constantly.

Sources: Wall Street Journal and NoHotAir