Chesapeake Energy Corp. is selling a swath of land in an oil-and-gas play in western Oklahoma as part of its plans to cut costs and focus on drilling in what it considers its most profitable acres.
Chesapeake is selling more than 28,000 net acres in the West Turkey Creek Granite Wash and Hogshooter Wash areas, according to a posting Thursday on the oil-and-gas real estate service Meagher Energy Advisors.
Chesapeake, the second-largest natural-gas producer in the U.S., has been selling assets to plug a cash shortfall as it moves its operations toward more-profitable oil production and attempts to cut back on its leasing and drilling budget. The Oklahoma City-based company has pledged to cut debt to $9.5 billion by the end 2012, down from $14 billion in the second quarter.
Chesapeake said the area for sale contains 117 wells that provided $3.2 million a month in net operating cash flow.
The acres Chesapeake announced for sale are "noncore" acres that are not connected to the Hogshooter oil discoveries that Chesapeake called a "significant" new discovery in May, Chesapeake spokesman Michael Kehs said.
The sale would not impact the company's drilling or capital expenditure plans for the next year, Mr. Kehs said.
Copyright (c) 2012 Dow Jones & Company, Inc.
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