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EXHIBIT 99
CONTACT: MARC ROWLAND,
CHIEF FINANCIAL OFFICER
(405) 879-9232
FOR IMMEDIATE RELEASE TOM PRICE, JR., VICE PRESIDENT-
JULY 19, 2000 CORPORATE DEVELOPMENT
(405) 879-9257
CHESAPEAKE ENERGY FORMS 2.2 MILLION ACRE
COAL BED METHANE JOINT VENTURE IN OKLAHOMA'S ARKOMA BASIN
OKLAHOMA CITY, OKLAHOMA, JULY 19, 2000 - Chesapeake Energy Corporation (NYSE:
CHK), today announced the formation of a joint venture with one of North
America's largest diversified natural gas companies to develop coal bed methane
(CBM) reserves from a 2.2 million acre area in eastern Oklahoma's Arkoma Basin.
In the initial phase of the joint venture, Chesapeake's partner has paid 100% of
the JV's costs for a 75% interest in the JV's assets with Chesapeake owning the
remaining 25%. In the secondary phase, Chesapeake will have the option to
increase its ownership in the JV to 33.3%. Approximately $10 million has been
expended in the JV to date and an additional $10-20 million of investment is
scheduled for the next 18 months. Drilling and production activities should
begin in the third quarter of 2000.
MANAGEMENT COMMENT
Aubrey K. McClendon, Chesapeake's Chief Executive Officer commented, "We are
very pleased to initiate activities in our new Arkoma Basin CBM play. For many
decades the Arkoma Basin in eastern Oklahoma has produced significant reserves
of both natural gas and coal. We believe the combination of Chesapeake's land
skills and large existing base of Arkoma assets provides a perfect complement to
our partner's operational and geological expertise in developing large-scale CBM
projects.
We also believe the Arkoma's combination of strong gas prices and low operating
costs will help make the economics of this project compare favorably to other
CBM plays in the U.S. In particular, the wells can be drilled, completed and
then immediately put in production - they will not need a lengthy, expensive and
environmentally risky de-watering process. We believe all of the elements are in
place for our JV to develop a large and successful CBM project in the years
ahead."
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EARNINGS AND CONFERENCE CALL INFORMATION
Chesapeake will release its second quarter 2000 financial and operating results
at approximately 4 p.m. EDT on Thursday, July 27. A conference call will begin
the next morning at 9 a.m. EDT, July 28. You may participate by calling
913-981-4900 or by visiting our homepage at www.chkenergy.com and clicking the
link under Shareholder Information or by going directly to Vcall.com. In
addition, a replay of the call will be available from 11:00 a.m. (CDT) through
August 4 at 12:00 p.m. by dialing 719-457-0820. The passcode for the replay is
638606.
The information in this release includes certain forward-looking statements that
are based on assumptions that in the future may prove not to have been accurate.
Those statements, and Chesapeake Energy Corporation's business and prospects,
are subject to a number of risks, including production variances from
expectations, uncertainties about estimates of reserves, volatility of oil and
gas prices, the need to develop and replace reserves, the substantial capital
expenditures required to fund operations, environmental risks, drilling and
operating risks, risks related to exploratory and developmental drilling,
competition, government regulation, and the ability of the company to implement
its business strategy. These and other risks are described in the company's
documents and reports that are available from the United States Securities and
Exchange Commission, including the report filed on Form 10-K for the year ended
December 31, 1999 and the report filed on Form 10-Q for the quarter ended March
31, 2000.
Chesapeake Energy Corporation is the 10th largest independent natural gas
producer in the U.S. (pro forma for the recently announced Gothic acquisition).
Headquartered in Oklahoma City, Chesapeake's operations are focused on
developmental and exploratory drilling and on property acquisitions in the
Mid-Continent region of the United States. The company's Internet address is
www.chkenergy.com.
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