Chesapeake Energy Corporation (NYSE:CHK) CEO Doug Lawler last month talked about drilling prospects from Australia to China and from Africa to Latin America.
While delivering a speech before a Rotary Club in Oklahoma City, the new CEO said Chesapeake Energy Corporation (NYSE:CHK)’s engineers and geologists have been analyzing rock data from around the world.
Chesapeake big shift in strategy
Doug Lawler’s predecessor Aubrey McClendon during an interview in 2012 ruled out foreign exploration. The new CEO’s intention may take the company to the one place his deals-obsessed predecessor never wanted to go. The overseas reach would thus mark a stark contrast to the growth strategy pursued by McClendon.
In his speech at the Rotary Club, Lawler said: “I wouldn’t be surprised if in Oklahoma City you had a company returning to the international area in a few years”.
Lawler said: “As we continue to focus on our captured resources in the United States, we have the technical capability, the leadership and the operational expertise to extend that in overseas areas”.
Chesapeake Energy Corporation (NYSE:CHK)’s Eagle Ford Shale operations, which are based in San Antonio, averaged 87,000 barrels of oil equivalent per day during the fourth quarter of 2013.
The second largest U.S. gas producer has been working to fix its balance sheet and put cost-cutting measures in place to counteract the high-spending programs which former CEO Aubrey McClendon had put into place. CEO Doug Lawler said they aim to slash spending by 20% this year and sell off some assets to take care of a $1 billion gap between their operating cash flow and capital expenditures.
The new CEO’s tenure thus far has been marked by disappointing profits, stalling production growth and costly disputes over gas royalty payments with landowners and politicians left over from the McClendon era. Despite the drastic cost-cutting, net debt has stubbornly hovered around $12 billion, triple the size of Chevron Corporation (NYSE:CVX)’s, a company more than 10 times larger by market value.