WASHINGTON (dpa-AFX) - Chesapeake Energy Corporation (CHK) Wednesday announced that it has agreed to sell the Brazos Valley region of its Eagle Ford asset to WildFire Energy I LLC for $1.425 billion.
Chesapeake has agreed to sell about 377,000 net acres and about 1,350 wells in the Brazos Valley region of its Eagle Ford asset, along with related property, plant and equipment.
Average net daily production from these properties was around 27,700 barrels of oil equivalent (boe) during the third quarter of 2022. As of December 31, 2021, net proved reserves associated with these properties were approximately 96.8 million barrels of oil equivalent.
'Today marks an important step on our path to exiting the Eagle Ford as we focus our capital on the premium, rock, returns and runway of our Marcellus and Haynesville positions,' said Chesapeake President and Chief Executive Officer Nick Dell'Osso. 'We remain actively engaged with other parties regarding the rest of our Eagle Ford position.'
Chesapeake expects the deal to close in the first quarter of 2023. The company will receive $1.2 billion upon closing with the additional $225 million paid in yearly installments of $60 million over the next three years and $45 million in year four. Chesapeake anticipates the proceeds will be used to repay borrowings under its revolving credit facility and be available for its share repurchase program.
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