Bankrupt U.S. shale pioneer Chesapeake Vitality on Monday laid out its long-term plans and detailed dramatically diminished drilling via the top of the yr, with half the rigs because it needed to begin 2020. Chesapeake on Sunday turned the most important U.S. oil and gasoline producer to hunt chapter safety in recent times because it bowed to heavy debt and the influence of the coronavirus outbreak on vitality markets.
The corporate mentioned 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 yr earlier than the coronavirus pandemic sapped gas demand and roiled the vitality markets. Final quarter, its rig depend edged all the way 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, continues to be the No. 2 shale gasoline producer behind EQT Corp, in keeping with knowledge supplier Enverus.
One among 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 circulate 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.