Bankrupt U.S. shale pioneer Chesapeake Energy on Monday laid out its long-term plans and detailed dramatically decreased drilling via the tip of the 12 months, with half the rigs because it needed to begin 2020. Chesapeake on Sunday grew to become the most important U.S. oil and gasoline producer to hunt chapter safety lately because it bowed to heavy debt and the impression of the coronavirus outbreak on power markets.
The firm stated it goals to run a rig program of six to eight rigs for the subsequent two years, and 7 to eight rigs between 2022 and 2024, a regulatory submitting confirmed. It didn’t specify what quantity was oil or gasoline rigs.
Chesapeake was working 15 rigs on common within the fourth quarter final 12 months earlier than the coronavirus pandemic sapped gas demand and roiled the power markets. Last quarter, its rig depend edged right down to 14 rigs.
The submitting additionally confirmed Chesapeake’s plans to function a median of simply six rigs between Appalachia and the Gulf Coast within the third and fourth quarters, in contrast with 14 throughout a number of U.S. fields within the first quarter. Its second-quarter common is estimated at seven rigs, with 36 gross wells drilled.
The producer, which spent closely to change into the highest U.S. producer of pure gasoline at one level, remains to be the No. 2 shale gasoline producer behind EQT Corp, based on information supplier Enverus.
One of Chesapeake’s pipeline suppliers, Crestwood Equity Partners LP, stated on Monday it doesn’t anticipate a monetary hit from the chapter – Chesapeake is present on excellent invoices and extra money movement safety is in place although letters of credit score. Crestwood gathers and processes Chesapeake’s pure gasoline and liquids within the Powder River Basin and Marcellus fields.