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Chesapeake Energy Increased Its 2016 Production Guidance

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Chesapeake Energy’s key operational highlights

Chesapeake Energy’s (CHK) 2Q16 production volumes totaled 60 million barrels of oil equivalent (or MMboe). In comparison, 2Q15 production volumes were 64 MMboe. Chesapeake Energy’s 1Q16 production volumes amounted to 61 MMboe.

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CHK’s cash costs

As a result of CHK’s focus on lowering costs, its combined production and G&A expenses fell from $5.40 in 2Q15 to $4.06 per boe in 2Q16—a year-over-year decrease of 25% and a sequential decrease of 2%.

In 2016, CHK’s cash costs are expected to average $4.1 per boe, down by ~21% compared to 2015 levels.

Chesapeake Energy’s 2Q16 realized prices

Chesapeake Energy’s average realized price of crude oil (OIL) and condensates fell from $71.39 per barrel in 2Q15 to $44.31 per barrel in 2Q16. Its average realized price for natural gas (UNG) fell from $2.35 per thousand cubic feet in 2Q15 to $1.97 per thousand cubic feet in 2Q16.

CHK’s average realized price for natural gas liquids fell from $13.02 per barrel in 2Q15 to $12.88 per barrel in 2Q16.

Chesapeake Energy’s 2016 production and capital guidance

Chesapeake’s 2016 production growth guidance range was increased to 625 Mboepd to 650 Mboepd compared to the previous range of 605 Mboepd to 635 Mboepd it had forecasted in 1Q16.

Meanwhile, its peer EQT (EQT) has provided production growth guidance of ~19% at the midpoint for 2016, and Antero Resources (AR) has provided growth guidance of 15% at the midpoint. Noble Energy has provided a growth guidance of 6%.

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