Major US Shale Producer Chesapeake Files for Chapter 11

Chesapeake Energy's bankruptcy delivers hit to reeling pipeline service firms

The DIP financing will provide Chesapeake the capital necessary to fund its operations during the Court-supervised Chapter 11 reorganization proceedings. The expansion was entirely fueled by debt, which crippled the company when its own success as a producer - and the success of its later rivals - drove the price of natural gas down almost 90 percent.

Oklahoma-based Chesapeake Energy filed for Chapter 11 on June 28, becoming the largest U.S. shale oil and gas producer to seek bankruptcy protection in recent years.

Founded in 1989 with an initial $50,000 investment, Chesapeake focused on drilling in underdeveloped areas of Oklahoma and Texas.

If its proposal ultimately is approved, Chesapeake would emerge from the process with a $2.5 billion line of credit, supplied through a $750 million term loan and $1.75 billion of new credit. The RSA is also backed by creditors, including those holding 87% of its term loan, 60% of its senior secured second lien notes due 2025 and around 27% of senior unsecured notes. Chesapeake brought its current chief executive, Doug Lawler, onboard in 2013 when the company was struggling to pull out of roughly £10.55 billion in debt.

"With the oil and natural gas prices the way they are right now, it would be nearly impossible for them to dig their way out of that situation", Agee said. The company cut eye-popping checks to Fort Worth businesses and residents as inducements to drill on their land in the Barnett Shale of North Texas, America's first shale field to hit the big time.

USA natural gas slumped after the 2008 financial crisis as the frackers overwhelmed demand, and prices still have not revisited their previous highs.

McClendon was forced out in 2013; he died three years later, the day after he was indicted on a charge of price-fixing, when he drove his Chevrolet Tahoe into a concrete abutment.

Google Photos Turns Off Backups for Third-Party Services
As a result, Google announced today that it is limiting what Google Photos will automatically back up on your Android device. Don't fret, though; if you're clever, you can reenable the auto-backup option for all of your device's photo folders.

When oil prices briefly turned negative in April after a collapse in energy prices, the company was issued a rare "strong sell" rating and slapped with a $US0 price target by CFRA Research.

The energy giant's share price has dropped more than 93 percent since January, from $172 to $11.85 as of close on Friday. Thanks to Lawler's strategy that included asset sales and aggressive cost cuts, the USA natural gas producer was able to minimise its debt pile in recent years. The company was in talks a year ago with Jerry Jones, the billionaire Dallas Cowboys owner, about a $1 billion sale of shale assets, but no deal resulted. As per the court filing, its assets and liabilites are now valued at £8.11 billion, and the company is aiming at slashing its debt by £5.68 billion.

Despite Chespeake's problems, Lawler past year remained the highest-paid chief executive in Oklahoma with $15.4m in compensation, according to a ranking compiled by Associated Press and Equilar.

The oil-and-gas group, which was once worth $US35 billion by market capitalisation, pioneered the entry into shale production a decade ago, setting the scene for the USA to become one of the leaders in the controversial field.

Since January, Chesapeake shares have fallen from highs of $180 per share, to just $11.85 today.

(This story includes reporting from Bloomberg).

Related News:

Most liked

ISPs call for ban on websites of China-backed companies
He adds that although there are ways to get around the ban, it will "effectively kill" popular apps. Some Indian apps like ShareChat, a local language social media platform, welcomed the ban.

Paul Walker's Daughter Shares Heart Warming Photo With Vin Diesel's Children
Last November, the ' The Pacifier ' star -Diesel wished Meadow a happy 21st birthday on Instagram with a sweet tribute. Explaining why she wanted to share the clip, Meadow wrote in the Instagram caption: "I never thought I'd share this".

USA top medical experts rebuke American Airlines for filling planes
Airlines are desperate to increase revenue as they try to survive a plunge in air travel that reached 95% during April. The airline originally shut down flights between China and the February due to the coronavirus outbreak.

Xavi admits preparing to become Barcelona coach
Luis Suarez , who scored a brace in the draw, told reporters after the game that the club's coaches were to blame for Barcelona's poor away form.

TV pioneer Carl Reiner dies at age 98
Mel Brooks paid tribute to his good friend and fellow comedy legend Carl Reiner , who passed away Monday at age 98. He recounted his childhood and creative journey in the 2013 book, I Remember Me .

US FCC designates Huawei, ZTE as national security threats
In April, the FCC said it may shut down USA operations of three state-controlled Chinese telecommunications companies. The Trump administration also added Huawei to its trade blacklist a year ago .

Province increases outdoor gathering limit to 200
Deena Hinshaw, Alberta's chief medical officer of health, provided her latest COVID-19 update at a news conference on Tuesday. All public health measures remain in place, however, including physical distancing between people of different households.

Barcelona sell another player after the sale of Arthur Melo
The purchase value may increase of maximum 10 million euros on achieving given conditions during the course of the contract. " Juventus and the player have signed a five-year contract of employment valid until June 30, 2025", Juventus announced.

IPhone 12 Won't Include a Charger or EarPods
A new report is causing rumors to swirl that Apple plans to remove most of the accessories from future iPhone boxes. These iPads will have a 20W charger , which will be obtainable as an individual buy for Apple iPhone entrepreneurs.

Indias first COVID-19 vaccine COVAXIN gets nod for human trials
As of Tuesday, more than 10 million cases of the virus have been recorded worldwide, leading to over half a million deaths. Phase one trials are small-scale, usually involving few participants, to assess whether the vaccine is safe for humans.

TikTok temporarily halts its services in India, Delisted from app stores
On the app front, we are well prepared. "Right now I don't think there are any easy options for New Delhi ". The Debate: Could it escalate? "Chinese investors are going to become very wary of investing in India".

Sacha Baron Cohen gatecrashes a right-wing gig
Not only that, Cohen's security were there with express orders to stop anyone from getting him off the stage or pulling the power. After video footage spread on social media, Variety later confirmed that the singer was in fact Baron Cohen.

Solskjaer challenges United to go unbeaten for rest of season
Solskjaer wants greater depth at Old Trafford, saying: "You need competition for places at Man United. United are sixth in the table, five points behind fourth-placed Chelsea .

Vancouver will not be a hub city for the National Hockey League playoffs
"Although Vancouver won't be a hub city, we are still excited to see hockey start up again", the team said in a statement. We are proud of the progress B.C. has made, and we have been clear that we will not bend our rules and risk this progress.

US Supreme Court rules to uphold abortion rights
Abortion rights supporters were quick to hail today's decision but cautioned that abortion rights remain under attack. Meanwhile, Missouri's admitting-privilege requirement has survived several court challenges, most recently when U.S.