8-KRegulation FDOther EventsExhibits & Filings

EXPAND ENERGY Corp 8-K Report, Regulation FD Disclosure (Jan 18, 2023)

Filed January 18, 2023For Securities:EXEEXEELEXEEWEXEEZ

Summary

Chesapeake Energy Corporation (CHK) has announced a significant divestiture, agreeing to sell its Brazos Valley Eagle Ford assets to WildFire Energy I LLC for a total consideration of $1.425 billion. This transaction includes approximately 377,000 net acres and 1,350 wells, marking a strategic move to streamline operations and monetize a key asset. The deal is structured with an immediate cash payment of $1.2 billion at closing, with the remaining $225 million to be paid in installments over several years, starting March 1, 2024. This structure provides Chesapeake with substantial upfront capital while also offering deferred payments, potentially supporting future growth or shareholder returns. The transaction is subject to customary closing conditions, including regulatory approvals.

Key Highlights

  • 1Chesapeake Energy to sell Brazos Valley Eagle Ford assets for $1.425 billion.
  • 2The sale includes approximately 377,000 net acres and 1,350 wells.
  • 3Total consideration comprises $1.2 billion in cash at closing and $225 million in deferred payments over four years.
  • 4Deferred payments are structured as $60 million on March 1st of 2024, 2025, and 2026, and $45 million on March 1, 2027.
  • 5Purchaser has deposited $142.5 million into escrow as a deposit.
  • 6The transaction is subject to customary closing conditions, including HSR Act approval.
  • 7The economic effective date of the transaction is October 1, 2022.

Frequently Asked Questions

Chesapeake Energy is selling its Brazos Valley region assets in the Eagle Ford shale play, which includes approximately 377,000 net acres and 1,350 wells, along with related infrastructure. The buyer is WildFire Energy I LLC.

The total consideration for the sale is $1.425 billion. This is comprised of $1.2 billion in cash to be paid at closing, and $225 million in deferred cash payments spread across several years.

The payment structure includes $1.2 billion in cash due at closing. The remaining $225 million will be paid in installments: $60 million on March 1, 2024, $60 million on March 1, 2025, $60 million on March 1, 2026, and $45 million on March 1, 2027. A deposit of $142.5 million has already been placed in escrow.

Yes, the closing is subject to customary conditions, which include the accuracy of representations and warranties, compliance with covenants, absence of governmental litigation, and expiration or termination of waiting periods under the Hart-Scott-Rodino (HSR) Antitrust Improvements Act.