Chesapeake Energy Corporation (NYSE:CHK) recently reported surprisingly good second-quarter results on the back of stronger-than-expected production. During the company's second-quarter conference call CEO Doug Lawler sounded very pleased with the results as well as the direction the company is heading. Here are five things he wanted investors to know about the company's current operations and future plans.

1. We're operating better-than-expected
Lawler led off the call by discussing the company's solid operations during the downturn. He said that, "The strong production performance in the first six months of the year positions the Company to enter 2016 at a higher rate than previously forecasted." Further, he pointed out that not only was production strong, but the company's operating costs continue to fall and are down about 8% year-over-year. Because of these strong operations and falling costs, the company is raising its full-year production guidance while maintaining its current capex budget.

2. We can overcome our challenges
Despite the company's operational strength, it still faces several challenges. Lawler addressed these by saying:

We understand that our debt structure and gathering commitments add to the challenges of the commodity price environment, and there are several questions out there in the market, such as: can Chesapeake generate sufficient cash flow to weather this storm? And can the portfolio and operational strengths overcome these significant obstacles? The answer is definitively, yes.

He then went through several options the company has at its disposal to enhance its cash flow and bolster its liquidity, which include "potential asset sales, joint venture agreements, and/or participation agreements" that it expects to complete this year. He said that the company has already had discussions with interested parties and is excited about its prospects. 

3. We have several options, but prefer JVs
That said, while the company has several options, it has one clear preference. Lawler said:

I personally am a fan of the JV structure if it's properly handled. And we would do exactly that. It builds underlying cash flow and accelerates value into the current term. But we also know that some of the assets, it may be better to completely exit the asset just because we're not going to be investing there for some time.

One of the reasons he likes the joint venture structure is because it enables Chesapeake Energy to grow by pulling value forward and generating recurring cash flow. That said, he's not opposed to selling non-core assets because that too pulls value forward and gives it the cash to reinvest in new wells elsewhere that would generate cash flow.

4. Why we want to grow in the current environment
What was particularly intriguing about Lawler's comments is that he intends to grow Chesapeake's production despite the fact that commodity prices are weak because there's simply too much oil and gas supply on the market. Lawler, however, doesn't see this as being an impediment because the company can still earn strong returns in the current environment. Still, analysts on the call questioned whether that was the right choice as it would seem that holding production flat until prices improve would be the better option. Lawler, however, responded by saying:

The strength and quality of the assets, the high-quality returns that we see in areas like Powder River Basin, the improvements in the Haynesville and the competitiveness there, and also the quality in the Utica: these are assets that, based on current pricing levels, current strip levels, attract capital. So deploying proceeds back into our program is very attractive. We would not do that if it were not economic and if prices were depressed sufficiently that we wouldn't be making the returns that we would anticipate. We're not going to do anything dilutive to shareholder value.

In other words, growing even in the current environment is simply the best thing for the company to be doing because the returns are just so compelling as it's accretive to the company over the long-term. That being said, the company would hold back on investing in new wells if it was no longer attractive because it's not going to grow just to grow. 

5. Here's our initial thoughts for 2016
While Chesapeake hasn't yet put out 2016 guidance, Lawler did give a sneak peek at the company's thoughts for the year ahead. He said:

Looking at 2016, we are not anticipating any significant recovery in pricing. As you look forward the curve is pretty tough. So the complete evaluation of how we invest scarce cash flow is really, really important ... So saying to you specifically that we're going to be investing at cash flow or we're going to be overspending, we just haven't provided that guidance at this time. We will continue to evaluate and look at our options ... We've got great options because of a great portfolio and great operating teams.

In other words, the company isn't yet ready to commit on a go forward strategy to either be disciplined and invest within its cash flow or be more aggressive and overspend. A lot of that is because it has options, it could sign a JV agreement or sell assets and bring in a lot of cash. Having said that, it doesn't expect prices to rebound so it still needs to have some discipline, even if it does overspend to grow into an oversupplied market.

Investor takeaway
Chesapeake Energy CEO Doug Lawler was really pleased with the results his team has been able to deliver in a tough commodity price environment. The company has really reduced its costs, which is making it very compelling to keep drilling even at current prices. That's why the company is looking for other sources of capital as it would like to continue to drill because the returns are still really strong.

Matt DiLallo has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. 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.