Chesapeake Executive: No Target Date to Find Permanent CEO
Chesapeake Energy Corp.'s acting chief executive declined to say Monday when the company expects to have a permanent chief executive to succeed Aubrey McClendon.
Mr. McClendon officially stepped down as chief executive Monday. Chesapeake, the second-largest U.S. natural-gas producer after Exxon Mobil Corp., has been searching for a new chief executive since January after Mr. McClendon agreed to leave the company he helped found, citing "philosophical differences" with board members installed by activist shareholders.
Chesapeake had been close to landing a new chief executive before an agreement fell apart in late negotiations, a person familiar with the company's inner workings had said. Chesapeake then named Chief Operating Officer Steve Dixon as acting chief executive, working in tandem with Chief Financial Officer Domenic J. Dell'Osso and Chairman Archie W. Dunham in a newly established office of the chairman.
Speaking with investment analysts Monday morning, Mr. Dixon declined to say when Chesapeake might have a permanent chief executive in place. He also declined to address reports that Chesapeake's negotiations with an unnamed candidate fell apart last week.
"Those are speculations and we won't addresses that," he said.
The board's delay in announcing a new chief executive doesn't bode ill for the company, which will have to find someone with experience running a large oil and gas production business and who will agree to move to the company's Oklahoma City headquarters, said Morningstar analyst Mark Hanson.
"I don't think it's a negative for Chesapeake investors that a CEO hasn't been found," Mr. Hanson said. "Being prudent is a good thing."
Chesapeake holds drilling rights to some of the most prolific sources of oil and gas in the U.S. But it has been battered by natural-gas prices that last year sank to their lowest level in more than a decade, forcing the company to sell assets to pay for its operations.
Chesapeake has since resorted to selling assets to keep itself afloat. The company is now focusing on selling smaller packages of acres than on blockbuster, multimillion-dollar deals that had been announced under Mr. McClendon's stewardship.
Chesapeake has already announced $1.5 billion in asset sales this year and says more deals will follow as rising natural-gas prices have made its acres more attractive to potential buyers.
Natural-gas prices settled above $4 a million British thermal units last week, the first time they have done so since August 2011.
"There's certainly sentiment in the market that gas has bottomed and is on the way up," Mr. Dixon said Monday.
Copyright (c) 2012 Dow Jones & Company, Inc.
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