8-KOther Events

EXPAND ENERGY Corp 8-K Report (Sep 20, 2002)

Filed September 20, 2002For Securities:EXEEXEELEXEEWEXEEZ

Summary

Chesapeake Energy Corporation (EXE) announced on September 20, 2002, the declaration of a quarterly common stock dividend of $0.03 per share, payable on October 15, 2002, to shareholders of record on October 1, 2002. This represents an expected annual cost of approximately $20 million and an annualized dividend yield of 1.9% at the then-current stock price. The company also declared its regular quarterly preferred stock dividend. Furthermore, Chesapeake Energy announced its strategic intention to sell or trade its Permian Basin assets to sharpen its focus on the Mid-Continent region, where 85% of its assets are already located. The company is seeking proposals, particularly those involving trades of Mid-Continent assets for Permian assets. This move is driven by the company's view that its operational returns and scale are superior in the Mid-Continent, where it is the largest natural gas producer.

Key Highlights

  • 1Chesapeake Energy declared a quarterly common stock dividend of $0.03 per share.
  • 2The common stock dividend is expected to cost approximately $20 million annually.
  • 3A regular quarterly cash dividend was declared for the 6.75% Cumulative Convertible Preferred Stock.
  • 4The company plans to divest or exchange its Permian Basin assets.
  • 5This strategic move aims to further concentrate operations in the Mid-Continent region.
  • 6Chesapeake Energy is the largest natural gas producer in the Mid-Continent.
  • 7Petrie Parkman & Co. has been engaged to assist with the Permian asset disposition.

Frequently Asked Questions

The company declared a quarterly common stock dividend of $0.03 per share, payable on October 15, 2002, to shareholders of record on October 1, 2002.

Chesapeake Energy is selling its Permian Basin assets to focus more intensely on the Mid-Continent region, where it is the largest producer and believes it achieves higher returns on investment due to factors like higher gas prices, lower operating costs, and better drilling results.

The estimated annual cost of the common stock dividend is approximately $20 million. Management believes this cost is modest and will not impede the company's ability to grow assets, reduce debt, and continue delivering strong total returns to shareholders.

The company's strategy is to concentrate on its core Mid-Continent operations, which represent 85% of its assets, and exit the Permian Basin. They are open to asset swaps, particularly trading Mid-Continent assets for Permian assets.