Chesapeake Energy (NYSE:CHK) closed on its Mississippi Lime joint venture with Chinese company Sinopec International Petroleum Exploration and Production Corp. (Sinopec) on June 28, Chesapeake announced today.
Sinopec paid Chesapeake $1.02 billion in cash for a 50% interest in 850,000 acres of shale gas property in northern Oklahoma. That field produced around 9,600 barrels of liquids, including oil, and 54 million cubic feet of natural gas each day during the first quarter of the year.
Chesapeake will conduct all leasing, drilling, completion, operations, and marketing activities of the joint venture. All costs for the project will be split between the companies.
In April 2012, Sinopec paid Devon Energy Corp. $900 million in cash for a one-third interest in five Devon exploration ventures in the U.S. Sinopec also agreed then to invest $1.6 billion in future Devon explorations.
Sinopec is the largest petroleum products manufacturer in China.