September 12, 2012
This week has been especially busy on the acquisition front, with Plains Exploration & Production purchasing $6 billion of Gulf of Mexico deepwater assets from BP and Shell, and now Chesapeake is shedding $6.9 billion in land and midstream assets. The former deal was unexpected, with the markets reacting strongly after the announcement, but the Chesapeake deal has already been factored into its stock price since management announced that significant divestments would be executed during the third quarter in their second-quarter-earnings call. To gain a better perspective of what this deal means for Chesapeake and its three-year asset-harvesting plan, as well as gather more information on the multiparty deal, than check out the video below.
This significant deal will not be the last for Chesapeake, as management expects to sell an additional $7 billion-$8 billion by the end of 2013 in order to improve its credit metrics. The company's goal is to increase its liquids production by 250% by 2015 in order to hedge from low natural gas prices with attractive crude. However, Chesapeake is just one of a plethora of companies making this move. If you're on the lookout for some other intriguing energy plays, check out The Motley Fool's "3 Stocks for $100 Oil." You can get free access to this special report by clicking here.