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- Chesapeake Energy CHK has agreed to divest a portion of its remaining Eagle Ford assets in South Texas to Ineos Energy for $1.4 billion.
- The deal covers 172,000 net acres and approximately 2,300 wells in the black oil portion of the gas producer's Eagle Ford assets, primarily in Dimmit, LaSalle, and McMullen counties.
- The sale also includes related property, plants, and equipment.
- The properties covered under the sale reported average net daily production rates of approximately 36,000 barrels of oil equivalent (boe) (81% liquid) at the end of 2022.
- As of 2022, the properties had net proven reserves of approximately 144 million barrels of oil equivalent.
- The acquisition will mark Ineos Energy's foray into the U.S. onshore oil and gas market.
- Ineos will make a $1.175 billion payment to Chesapeake upon the transaction's closing. An additional $225 million will be paid in installments.
- Chesapeake plans to use the proceeds from the transaction to reduce its debt and share buybacks.
- Chesapeake's net production in the fourth quarter was approximately 4.05 bcfe daily.
- Minor production curtailments negatively impacted fourth-quarter sales in November and weather conditions in late December.
- For FY23, the company expects capital expenditures of $1.765 – $1.835 billion.
- Price Action: CHK shares are up 1.26% at $79.67 on the last check Wednesday.
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