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Inside Chesapeake Energy’s 1Q16 Operational Highlights

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Dec. 4 2020, Updated 10:43 a.m. ET

Chesapeake Energy’s 1Q16 production

Chesapeake Energy’s (CHK) total production volume in 1Q16 was 672.4 Mboepd (thousand barrels of oil equivalent per day). This represents a YoY (year-over-year) rise of ~1%, adjusted for asset sales.

For 2016, Chesapeake Energy (CHK) expects its annual production to decline in the range of -5%–0%, adjusted for asset sales.

By comparison, upstream companies Cabot Oil & Gas (COG) and QEP Resources (QEP) expect their respective production levels to grow by 4.5% and -4%, respectively, in 2016. Newfield Exploration (NFX) expects its annual production in 2016 to be ~3% lower than its 2015 production levels.

On the other hand, PDC Energy (PDCE) expects its annual production to grow in the range of 30%–40% in 2016. Notably, CHK, COG, and NFX make up ~7.4% of Guggenheim S&P 500 Equal Weight Energy ETF (RYE).

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CHK’s 1Q16 realized prices

CHK’s crude oil price realizations, including the effect of hedges, were $37.74 per barrel in 1Q16, which is ~43% lower than its 1Q15 realized prices.

CHK’s natural gas price realizations were $2.29 per thousand cubic feet in 1Q16, which is ~38% lower than its 1Q15 realized prices.

CHK’s natural gas liquids price realizations were $11.44 per barrel in 1Q16, which represents a fall of ~38% as compared to 1Q15.

CHK’s capex guidance and cost guidance

CHK has announced a 57% YoY reduction in its capital expenditure to reduce its debt load and improve liquidity. The company continues to employ cost-efficient measures as it did in 2015. But in 2016, Chesapeake Energy expects its LOE and G&A expenses per barrel to decline by 10% and 15%, respectively.

Quarterly cash costs per boe in 1Q16 were down by 28% YoY and down ~11% sequentially.

Now let’s take a look at Chesapeake’s recent stock performance.

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