SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported)
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March 14, 2003 (March 13, 2003)
CHESAPEAKE ENERGY CORPORATION
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(Exact name of Registrant as specified in its Charter)
Oklahoma 1-13726 73-1395733
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(State or other jurisdiction (Commission File No.) (IRS Employer
of incorporation) Identification No.)
6100 North Western Avenue, Oklahoma City, Oklahoma 73118
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(Address of principal executive offices) (Zip Code)
(405) 848-8000
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(Registrant's telephone number, including area code)
INFORMATION TO BE INCLUDED IN THE REPORT
ITEM 5. OTHER EVENTS
Chesapeake Energy Corporation ("Chesapeake") issued the following press
release on March 13, 2003:
CHESAPEAKE ENERGY CORPORATION ANNOUNCES COMPLETION OF
ACQUISITION OF $500 MILLION OF MID-CONTINENT GAS
RESERVES FROM EL PASO CORPORATION
OKLAHOMA CITY, OKLAHOMA, MARCH 13, 2003 - Chesapeake Energy Corporation
(NYSE:CHK) today announced that it has completed its previously announced
acquisition of Mid-Continent gas assets from the El Paso Corporation (NYSE:EP)
for $500 million.
The acquisition was funded with proceeds from the company's February 2003 public
offering of 23 million common shares at $8.10 per share and private offerings of
$230 million of 6.0% cumulative convertible preferred stock and $300 million of
7.5% senior notes.
This document contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. Forward-looking statements include estimates and give our current
expectations or forecasts of future events. They are based on our historical
operating trends, our existing commodity hedging position and our current
estimate of proved reserves. Although we believe our forward-looking statements
are reasonable, they can be affected by inaccurate assumptions or by known or
unknown risks and uncertainties. For example, statements concerning the fair
values of derivative contracts and their estimated contribution to our future
results of operations are based upon market information as of a specific date.
These market prices are subject to significant volatility. Factors that could
cause actual operating and financial results to differ materially from expected
results include the volatility of oil and gas prices, our substantial
indebtedness, our commodity price risk management activities, the cost and
availability of drilling and production services, our ability to replace
reserves, the availability of capital, uncertainties inherent in evaluating our
own reserves and the reserves we acquire, drilling and operating risks and other
risk factors described in the company's 2002 annual report on Form 10-K and
subsequent filings with the Securities and Exchange Commission.
Chesapeake Energy Corporation is one of the 10 largest independent natural gas
producers in the U.S. Headquartered in Oklahoma City, the company's operations
are focused on exploratory and developmental drilling and producing property
acquisitions in the Mid-Continent region of the United States. The company's
Internet address is www.chkenergy.com.
ITEM 9. REGULATION FD DISCLOSURE
Based on internal reservoir engineering estimates, Chesapeake believes that it
has acquired approximately 328 billion cubic feet of gas equivalent (bcfe) of
proved gas reserves and approximately 70 bcfe of probable and possible gas
reserves. The acquired properties are expected to contribute approximately 67
million cubic feet of gas equivalent per day to Chesapeake's continued
production growth.
Aubrey K. McClendon, Chesapeake's Chief Executive Officer, commented, "We are
pleased to announce the completion of another successful acquisition of
Mid-Continent gas assets. The acquisition of the El Paso assets provides
continuing production growth opportunities in our Mid-Continent stronghold and
fits perfectly with our existing asset base. The transaction is projected to
increase Chesapeake's proved reserves to approximately 2.75 trillion cubic feet
of gas equivalent and our projected current production to 640 million cubic feet
of gas equivalent per day. Today's announcement provides further evidence of our
ongoing commitment to continue building the dominant Mid-Continent natural gas
producer and to create industry-leading value through organic production growth
and further consolidation of high-quality gas assets in the Mid-Continent."
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
CHESAPEAKE ENERGY CORPORATION
By: /s/ Aubrey K. McClendon
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Aubrey K. McClendon
Chairman of the Board and
Chief Executive Officer
Dated: March 14, 2003
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