Chesapeake Energy Corp Announces Agreements To Sell Permian, Midstream And Certain Other Assets To Royal Dutch Shell Plc's Subsidiary

Chesapeake Energy Corp announced that it has entered into multiple agreements to sell majority of Permian properties, substantially all of midstream assets and certain noncore leasehold for total net cash proceeds of approximately $6.9 billion. The Company will use a portion of the proceeds from these asset sales to fully repay $4.0 billion of term loans during the 2012 fourth quarter. Chesapeake has entered into purchase and sale agreements with three companies covering majority of Permian Basin assets for total net proceeds of approximately $3.3 billion. Chesapeake has entered into a purchase and sale agreement to sell assets in the southern Delaware Basin portion of the Permian Basin to SWEPI LP, a subsidiary of Royal Dutch Shell plc. Additionally, Chesapeake has entered into a purchase and sale agreement to sell assets in the northern Delaware Basin portion of the Permian Basin to Chevron U.S.A. Inc., a subsidiary of Chevron Corporation. The midstream transactions are expected to close on various dates in the 2012 third and fourth quarters. Jefferies & Company, Inc. and Goldman, Sachs & Co. are serving as financial advisors to Chesapeake regarding the Permian Basin asset sales and the sale of midstream assets to GIP.