Chesapeake strikes $1B deal with China’s Sinopec
Chesapeake Energy Corp. announced Monday that it is selling half of its acreage in northern Oklahoma’s oil-rich Mississippi Lime play to China’s Sinopec International Petroleum Exploration and Production Corp. for more than $1 billion.
Sinopec already has an interest in the area, thanks to last year’s $2.5 billion deal with another Oklahoma City oil and natural gas company, Devon Energy Corp.
Chesapeake will sell Sinopec half of its 850,000 acres in the play for $1.02 billion, the company announced Monday.
The two companies will split future exploration and development costs for that acreage, with Chesapeake serving as operator.
“We are excited to announce the execution of our Mississippi Lime joint venture with Sinopec, which moves us further along in achieving our asset sales goals and secures an excellent partner to share the capital costs required to actively develop this very large, liquids-rich resource play,” said Steven C. Dixon, Chesapeake’s chief operating officer.
Chesapeake has been selling assets since last year to close a funding gap between its income and operating costs.
The company, which is facing life without iconic founder Aubrey McClendon, sold more than $11 billion worth of assets to avert a cash crunch last year, with plans to raise as much as $7 billion that way in 2013.
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Bro, your reading comprehension is lacking. CHK sold 1/2 of its acreage in the Miss. Lime (NOT 1/2 of all of OK’s oil) to Sinopec. If you think 1/2 of the state’s oil is worth $1B… Also, did you say such things when BP was drilling in the gulf? Do you even know what BP stands for?
This isn’t the first time china has bought interest in American plays. The Chinese have all the money because people won’t stop shopping at Walmart the true destroyer of the American lifestyle and jobs. Until people are willing to pay a fair price for an American product then the Chinese will continue to buy our businesses with the money with give them for manufacturing Walmart goods.
This is totally disgusting! We have tons of oil in Oklahoma and what do they do? Sell it to China? What a crock! We might as well close the state and let China move in. Or should I say….just leave the country. This is treason to the US. Before you know it, the whole country will belong to overseas interests! I say, kick them all out of our country!
This is another example of Independent corporation self serving Interest.
Capitalism is ok;however, where is the national plan coordination between corporations to insure the USA is energy Independent?
Folks, we are selling out our north American resources to the highest bidders. Corporations are there for profits and management bonus! Unless the men and women on the Board od Directors work for our future energy independence…. You will continue to see higher fuel bills and possible less for our children.
There must be a national plan which multinational corporations are required to support us and not their bonus!
Loretta, do you have any foreign investments? Do you even know what CHK sold to Sinopec? How is it treason to sell a commodity to China? They diidn’t buy the land as in they own part of OK now – they are purchasing the rights to the oil. How is China producing and purchasing oil different than any other company doing the same? Are the Chinese guilty of treason to their country because they allow WalMart to come in, set up factories, use Chinese mined/farmed commodities and then sell these items to the US? Do you know we live in a global economy? You want free market? The highest bidder was the red commies over in China, so they win the free market today, so sad.
“There must be a national plan which multinational corporations are required to support us and not their bonus!”
So you want to socialize the oil and gas companies?
Where was all the outrage when Sandridge did a similar deal in the Mississippi Lime with Spain’s Repsol?
I think it is a great thing that Oklahoma’s oil patch is being elevated to the global stage. Companies from around the world are willing to pay billions of dollars to invest in our state. That isn’t something to mourn; it is something to celebrate.
The oil isn’t going to go to China. It is going to be sold at the fair market price to refineries in the U.S., just the same as if an American company pumped it from the ground.
Like it or not, we live in a global, interconnected economic system. There is no turning back on that. The countries and states that recognize this and compete globally will win. The countries and states that fail to grasp this will lose. We cannot develop our state in isolation from the rest of the world.
It would seem that at leat the energy sector in Oklahoma gets it. Let’s hope that the fear mongering, ignorance, and xenophobia don’t mess it up for everyone.
So, the new Cheasepeak CEO has sold half of Oklahoma’s oil to the People’s Republic of China. So much for American patriotism. I think we should go ahead and hoist the Red Chinese Flag over the Capitol Building in OKC. Maybe they could afford to fix it, now that they own it.