OKLAHOMA CITY — Chesapeake Energy Corp. says it will sell its assets in the Fayetteville Shale in Arkansas to BHP Billiton Limited of Australia for $4.75 billion in cash.
Oklahoma City-based Chesapeake announced the deal Monday. The sale includes Chesapeake’s interests in 487,000 net acres of leasehold and producing natural gas properties.
The transaction also will include existing natural gas production of about 415 million cubic feet of natural gas equivalent per day and midstream assets with about 420 miles of pipeline.
Chesapeake will provide essential services for up to one year for the new BHP Billiton properties for an undisclosed fee. The deal is expected to close during the first half of 2011.
Chesapeake CEO Aubrey McClendon says the deal ensures the company is making “substantial progress” in meeting debt reduction targets.
“The Fayetteville shale is a world-class onshore natural gas resource,” said J. Michael Yeager, Chief Executive of BHP Billiton Petroleum. “The purchase of this long-life field immediately adds over 10 trillion cubic feet of gas resources to our portfolio and is consistent with our strategy of investing in large, low cost assets with significant volume growth for future development.”