Chesapeake Energy steps back from Oil Leases in SW Bakken in North Dakota

by Jeffrey Gordon on


BISMARCK TRIBUNE

Article by Lauren Donovan in the Bismarck Tribune recently that Chesapeake Energy has notified a number of oil rights holders that they do not intend to go forward on the development of those interests they have leased.  Given that some if not many times there are various entities between the mineral rights holder and the eventual energy developer, it is not surprising that Chesapeake and other giant energy companies would hold the trump cards in the lease.  The big point of the article was that perhaps the results in SW North Dakota Bakken drilling by Chesapeake have not justified the lease terms etc.  Chesapeake seems to be highly leveraged and perhaps in a time of very low natural gas prices they are quickly trimming lease obligations in order to balance out their balance sheets and profit and loss.  The great thing is that mineral rights holders are free to put another deal together and Chesapeake will likely find a little chiller reception from mineral rights holders and their advisers going forward.  Is this a new definition of the Bakken Play in Hettinger and Stark Counties?

 

 

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