It Took Me by Surprise I Must Say

Things are a little different in the gas patch these days; Leasing forums,GoogleMaps,Addenda on the web are helping Lessors become informed. Imagine approaching a farmer to sign an oil & gas lease and they know more about it than you do? Hell, they didn't teach me that in Landman school!

Full Story at http://www.time.com/time/business/article/0,8599,1820884,00.html

Drillbits

Truckin, Like the Do-Dah Man

Chesapeake Energy announced after the close today that they will offer 25 million common shares with the customary 15% over allotment. Net proceeds from the offering will be used to temporarily repay outstanding indebtedness under its revolving bank credit facility which it anticipates re-borrowing from time to time to fund its recently announced drilling and leasehold acquisition initiatives and for general corporate purposes.

Take a look at the capital flows since the end of last quarter:

April 2 - Sold 23 million shares of Common netting $1.011B
May 1 - Sold Tex-Okla-Kan assets for $623 million
May 1 - Sold Woodford Shale holdings for $1.5B
May 20 - Sold $1.38B of Contingent Convertible Senior Notes netting $1.173B
May 20 - Sold $800 million of Senior Notes netting $487 million after retiring notes.
July 1 - Sold 20% interest in the Haynesville shale to Plains (PXP) for $1.65B
July 8 - Selling 28.75 shares Common to net $1.7B (estimated @$60/sh. net)

Net Cash from Equity Sales $2.71B
Net Cash from Debt Sales $1.66B
Net Cash from Asset Sales$3.77B

Total $8.14B


The $1.65B Haynesville sale to Plains Energy also includes an additional $1.65B commitment from Plains for future cost sharing to develop the play. This transaction effectively raised the value of Chesapeake's remaining 80% interest in the Haynesville by $9.5B to $13.2B. At the end of Q1, CHK's market cap was about $24B. Including the latest offering shares, as of today's close, the market cap would be $35B; up 42% (diluted) while net assets, thanks to the Haynesville alone are up 81%. The Woodford sale and Q2 net income will probably further add to net assets.

The only acquisitions announced during the period were for 18,000 acres in the Haynesville from Goodrich Petroleum and a third party for about $300 million (est.), and the Pier One building. So, going into Q3, any concerns about CHK's debt levels should be laid to rest; that is, unless Aubrey finds another Hunt Petroleum.

Sometimes the lights all shinin' on me......

Full Story at http://phx.corporate-ir.net/phoenix.zhtml?c=104617&p=irol-newsArticle&ID=1172815&highlight=