Chesapeake Energy Corp. and Sinopec International Petroleum Exploration and Production Corp. have an agreement providing for Sinopec to pay $1.02 billion for a 50% undivided interest in 850,000 of Chesapeake’s net oil and natural gas leasehold acres in the Mississippi Lime play in northern Oklahoma.
Production from these assets, net to Chesapeake’s interest and prior to Sinopec’s purchase, averaged 34 MBoe/d in fourth quarter of 2012 and, as of Dec. 31, there was 140 MMBoe of net proved reserves associated with the assets.
All future exploration and development costs in the joint venture will be shared proportionately between the parties with no drilling carries involved. As the operator, Chesapeake will conduct all leasing, drilling, completion, operations and marketing activities for the joint venture. The transaction is anticipated to be completed in the second quarter.