Chesapeake buying Houston’s WildHorse for $3bn

WildHorse Resource Development drilling superintendent Josh Bradford points at one of the drilling rigs outside Caldwell Tuesday Oct. 2, 2018.
WildHorse Resource Development drilling superintendent Josh Bradford points at one of the drilling rigs outside Caldwell Tuesday Oct. 2, 2018.

Early shale developer Chesapeake Energy said Tuesday it is acquiring Houston’s WildHorse Resource Development for $3 billion in cash and stock.

Oklahoma City-based Chesapeake is scooping up WildHorse, which is exclusively focused on exploration and production in the northeastern corner of the Eagle Ford shale closer to College Station. WildHorse also is about to open a new sand mine in the area to service its hydraulic fracturing, or fracking, of wells.

The deal represents a consolidation of major Eagle Ford players with Chesapeake more focused in the southwestern portion of the shale play.

The sale will primarily come in stock – as well as up to $400 million in cash from Chesapeake – so WildHorse shareholders will actually own about 45 percent of the expanded Chesapeake. The Oklahoma producer also will take nearly $1 billion in WildHorse debt.

Chesapeake Chief Executive Doug Lawler said the deal will provide a big boost to the company’s oil production. Chesapeake has historically focused more on natural gas production.

“This transaction accelerates Chesapeake’s strategic plan and expands the value-creation opportunities for our shareholders by adding a premier asset at an attractive valuation,” Lawler said.

This article first appeared on the Houston Chronicle – an Energy Voice content partner. For more from the Houston Chronicle click here.

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