Chesapeake Energy Posts Q1 Loss of $964 Million
OKLAHOMA CITY – Chesapeake Energy Corp. posted a net loss of $964 million or $1.44 per diluted share during the first quarter, the company reported this morning.
The primary driver for the loss was a noncash write-down of $853 million against Chesapeake’s oil and gas properties, which have declined in value since commodity prices started to tank in late 2014.
Commodity prices also affected the company’s first quarter revenues, which were down 39% year over year, Chesapeake said. These losses were partially offset by improvements to the company’s production expenses.
Revenues during the first three months of 2016 stood at $1.9 billion versus $3.2 billion during the same period in 2015.
Chesapeake reported it has reached an agreement to sell 42,000 acres in the Anadarko Basin Stack play in Oklahoma for $470 million to Newfield Exploration Co., as Chesapeake continues to divest assets in order to strengthen its cash balance.
“Chesapeake is delivering on all four of the focus points in 2016 that we stated in February: maximizing liquidity, optimizing our portfolio, increasing cash flow and reducing debt,” said CEO Doug Lawler. “The Stack acreage sale we are announcing today accelerates value from a portion of our undeveloped acreage that currently generates very little cash flow, giving us the ability to enhance current liquidity.”
Total capital expenses for the quarter were $365 million compared to approximately $1.5 billion during the first quarter of 2015.
Chesapeake reported it had just eight rigs operating during the first quarter of 2016 versus 54 during the first three months of 2015.
The company completed 57 wells during the first quarter, drilled another 41, and tied 80 wells into pipelines during the period, Chesapeake reported.
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