US shale company Chesapeake sees more natural gas in its mix
US producer Chesapeake Energy said May 11 its production levels would remain neutral through 2022, but sees natural gas as an expanding part of its portfolio.
Chesapeake filed for Chapter 11 protection in June, becoming the largest US shale oil and gas producer to seek bankruptcy protection in recent years. Under a court-approved plan, $7.8bn of debt has been equitised. The company expects to generate over $2bn of free cash flow over the next five years.
The National Gas Company of Trinidad and Tobago Limited (NGC) NGC’s HSSE strategy is reflective and supportive of the organisational vision to become a leader in the global energy business.
Leaving bankruptcy protection earlier this year, the company said in its Q1 2021 earnings report that it ended the period with $340mn in cash on hand, had $409mn of cash from operations under post-Chapter 11 fresh start accounting principles and reported successor company net income of $295mn. Under fresh start accounting, asset valuations are based on their estimated fair values and financial statements are not comparable with prior periods.
Operationally, Chesapeake said net production averaged 436,000 barrels of oil equivalent/day, with natural gas accounting for 77% of that total. The company said it expects total production levels to remain flat, though natural gas grows to 85% of its total production mix next year.
Chesapeake currently has three rigs working in the Appalachia shale, three in Haynesville and one in South Texas. In its latest drilling productivity report, the Energy Information Administration said it expects to see the most short-term production gains in the Haynesville play, which is spread across East Texas and northwest Louisiana.
The beleaguered company was founded by Aubrey McLendon and Tom Ward in the 1980s, leading pioneering efforts in the US shale boom. McLendon stepped down as CEO in 2013 and the company he helped found later sued him on charges of misappropriating funds.
McLendon died in a single-vehicle crash in 2016. At its peak, the company was the second biggest US gas producer behind ExxonMobil, but it overextended itself, racking up $13bn by the time McLendon stepped down.