Chesapeake and Anadarko Enter Joint Venture Agreement

Chesapeake Energy Corporation and Anadarko Petroleum Corporation have completed several agreements, including a joint venture involving Chesapeake and Anadarko assets in the Deep Haley area of the Delaware Basin in West Texas.

Through the formation of a joint venture and other separate agreements, Chesapeake received:

- 25% of Anadarko's existing Deep Haley area production;

- 25% of Anadarko's leasehold in the central and eastern portions of the Deep Haley area;

- 50% of Anadarko's leasehold and contractual rights in the western portion of the Deep Haley area;

- A lease from Anadarko on 2,100 net acres in the Fayetteville Shale play in Arkansas;

- An assignment of 5,600 net acres of undeveloped leasehold in the Anadarko Basin in western Oklahoma; and

- The Oklahoma City real estate assets acquired by Anadarko last year as part of its acquisition of Kerr-McGee Corporation.

Through the formation of the joint venture and other separate agreements, Anadarko received:

- Approximately $310 million in cash and other consideration, including reimbursement of capital expenditures previously incurred by Anadarko in connection with the development of the Deep Haley properties and Chesapeake's commitment to fund a portion of Anadarko's future Deep Haley area capital costs; and

- 50% of certain Chesapeake non-producing leasehold interests in Loving County, Texas.

In total, Anadarko and Chesapeake will jointly evaluate and explore more than 1 million gross acres in the Deep Haley area, on which drilling, completion, production and midstream operations will be shared on roughly a 50/50 basis. The two companies plan an aggressive drilling program for the area, with Anadarko and Chesapeake each currently operating eight drilling rigs in the Deep Haley area with the possibility of increasing drilling activity as the joint venture develops.

Aubrey K. McClendon, Chesapeake's Chairman and Chief Executive Officer, commented, "We are very pleased to announce this transaction with Anadarko. We have long admired Anadarko's capabilities in deep gas exploration and we are now excited to join forces with them in the Deep Haley area, one of the country's premier deep gas exploration projects. Our recent drilling results in the Deep Haley area have been exceptional and we are confident that by joining forces with Anadarko the technical teams of the two companies will continue to enjoy success in drilling prolific wells in the Deep Haley area. As reported during our 2007 first quarter earnings conference call last month, Chesapeake's most recent seven wells in the Deep Haley area generated a combined 90 mmcfe per day of gross production during May. We hope to drill many more similarly productive wells in our new partnership with Anadarko in the years to come. In addition, we are pleased to purchase the former Kerr-McGee properties in Oklahoma City. These properties are important to our community and we are happy to return them to local ownership."

James T. Hackett, Anadarko's Chairman, President and Chief Executive Officer stated, "This transaction fits our strategy very well and positions us for continued growth from a core asset with a partner that understands this play. The Deep Haley area in West Texas has recovered over 1.4 TCF from the over-pressured Pennsylvanian formations. Anadarko started work in the basin in 2003 and employed state-of-the-art drilling and completion technology with great success. After accumulating the rights to over 400,000 net acres, it was time to expand our drilling operations and we are glad to have Chesapeake jointly involved with us. Working collaboratively will enable our companies to maximize value by accelerating development of the considerable resources in the play. Our substantial combined position provides us with meaningful upside potential from future drilling activity, and we look forward to working with Chesapeake to continue delivering these resources to American consumers."