Bankrupt U.S. shale pioneer Chesapeake Power on Monday laid out its long-term plans and detailed dramatically lowered drilling by way of the top of the 12 months, with half the rigs because it needed to begin 2020. Chesapeake on Sunday grew to become the biggest U.S. oil and fuel producer to hunt chapter safety lately because it bowed to heavy debt and the influence of the coronavirus outbreak on power markets.
The corporate mentioned it goals to run a rig program of six to eight rigs for the following two years, and 7 to eight rigs between 2022 and 2024, a regulatory submitting confirmed. It didn’t specify what quantity was oil or fuel rigs.
Chesapeake was working 15 rigs on common within the fourth quarter final 12 months earlier than the coronavirus pandemic sapped gasoline demand and roiled the power markets. Final quarter, its rig depend edged right down to 14 rigs.
The submitting additionally confirmed Chesapeake’s plans to function a mean 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 grow to be the highest U.S. producer of pure fuel at one level, remains to be the No. 2 shale fuel producer behind EQT Corp, in keeping with knowledge supplier Enverus.
One in all Chesapeake’s pipeline suppliers, Crestwood Fairness Companions LP, mentioned 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 fuel and liquids within the Powder River Basin and Marcellus fields.