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.
Joel South has no positions in the stocks mentioned above. The Motley Fool has the following options: long JAN 2013 $16.00 calls on Chesapeake Energy, long JAN 2013 $25.00 calls on Chesapeake Energy, long JAN 2014 $20.00 calls on Chesapeake Energy, and long JAN 2014 $30.00 calls on Chesapeake Energy. Motley Fool newsletter services recommend Chevron. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
More from The Motley Fool
These 3 Dividend Giants Are Safer Than You Think
Concerns about these stocks and their dividends are overblown.
3 Dividend Stocks With Better Yields Than Chevron
Target, Vale, and Total pay investors a higher dividend and are attractive income candidates today.
3 Dividend Stocks I'd Never Buy
Big oil stocks are paying big dividends, but ExxonMobil, Royal Dutch Shell, and Chevron, are poorly positioned to reward investors long term.