Pennsylvania Update
We want to take this opportunity to update you, the elected officials and stakeholders of northeast Pennsylvania, about our operations, our activities in the community and how we are continuing to be a responsible community partner.
August 2023
Operational and Financial Update
On Aug. 2, Chesapeake reported its 2023 second quarter financial and operating results. To learn more, see our news release, presentation and earnings highlights.
Business Unit Snapshot (2Q’23):
Adjusted EBITDAX(1)
$524mm
Capital
$505mm
lower end of quarter guide
Cash balance
~$900mm
as of 6/30/23
Production
~3.7 bcfe/d
high end of quarter guide
Increased base dividend
~4.5% to $0.575
per share per quarter;
to shareholders of record on 8/17/23
Stock buybacks
~$125mm
YTD cash returned
to shareholders
~$515mm
via dividends and buybacks
Drilled fastest well in CHK Marcellus history
<8 days
2,165′ per day
(average spud to TD)
HOA for natural gas delivery and up to
1 mtpa
of liquefaction capacity at Lake Charles LNG facility to support offtake HOA with Gunvor
Rating upgrades
Ba1/BB+
from Moody’s / Fitch
Net debt(1)-to-cap(1)
~10%
Net debt(1) / EBITDAX (1)
~0.3x
Marcellus RSG recertification
Grade A/A-
under MiQ / EO100™
(1) A non-GAAP measure as defined on our website.
Marcellus Operations:
- Currently operating four drilling rigs.
- Currently operating one frac crew.
- Drilled three of the five fastest wells in company history in the Marcellus.
Fastest Well Record
Our Marcellus team set a new company record for safely drilling the fastest well in Q2. They drilled a 10,383-foot lateral to a total depth of 17,083 feet in less than eight days. The achievement was a collaborative effort between our teams and partners and highlights our culture of continuous improvement and innovation.
Get to Know Senior Staff Landman Seth Caputo
In each issue of the newsletter, we’ll introduce you to a member of our team working in the local area to help you get to know your Chesapeake neighbors. Our first feature is on Senior Staff Landman Seth Caputo.
Seth began his career at Chesapeake as a contract landman in 2008 and was hired as an employee in 2017. Altogether, he’s been representing the company’s interests in the Marcellus for roughly 15-and-a-half years.
As senior staff landman, Seth is responsible for acquiring and overseeing the acquisition of agreements necessary to further Chesapeake’s business objectives in the Marcellus.
Primarily, he acquires agreements, such as leases, lease amendments and lease extensions, covering landowners’ subsurface rights necessary to ensure delivery of the drilling schedule.
He also interacts with royalty owners, local attorneys and community leaders on a regular basis. In this capacity, he fields questions related to ownership transfers, royalty payments, current development activities and future plans.
“I enjoy educating and helping landowners gain a better understanding of natural gas development and related royalties,” Seth said. “Though we have been developing for roughly 15 years in the Marcellus, landowners still have a lot of questions related to the industry. I get a lot of joy from helping them and take pride in being a direct contact they can count on for reliable, transparent information.”
When he’s not working, Seth enjoys spending time with family and friends. He’s coached his son in his youth sports for the past several years. Most recently, he managed their local Juniors Little League team that finished runner up in their district.
He also enjoys fishing, hunting, golfing and shooting pool. Additionally, he likes to take in a good movie/show and catch live music as much as possible.
Elected Officials Visit Field
We recently hosted Congressman Dan Meuser, State Representative Tina Pickett, County Commissioners Doug Mclinko and Daryll Miller, and Matt Osenbach from Senator Gene Yaw’s office on a field visit, showing how we safely and responsibly produce natural gas.
Rep. Meuser noted, “The Chesapeake operation and their responsible drilling practices are important for Pennsylvania energy and to the national security of the United States, and it gives me confidence in the future of American energy. The rigorous standards upheld by American natural gas companies set a global benchmark for conscientious energy extracting. I am very happy to represent a district that harnesses its resources to responsibly deliver clean, affordable, and dependable natural gas, benefitting my constituents, fellow Americans, and the world at large.”
CHK Team:
Our Team in Sayre is speaking with landowners every day as we prepare for future development.
Seth Caputo
Landman
570-419-5381
seth.caputo@chk.com
Shannon Brooks
Landman
607-731-9763
shannon.brooks@chk.com
Jonah Howe
Community Affairs
724-553-8164
jonah.howe@chk.com
In The Community
Chesapeake’s Marcellus team has been busy volunteering the past few months of 2023 as we strive to strengthen the communities in which we operate. Our H.E.L.P. (Help Energize Local Progress) Initiative provides our employees the opportunity to volunteer their time helping countless worthwhile non-profit organizations. Below are some community highlights from the second quarter of 2023.
Keeping First Responders Safe
Chesapeake recently presented the Sullivan County Fire Department in Northeastern Pennsylvania with a $17,000 donation to help fund the purchase of protective ballistic vests for county Emergency Medical Technicians.
The vests, which can stop bullet penetration as well as protect against a knife attack, will be carried on each ambulance ride in the county, keeping our first responders safe.
Dushore Founder’s Day Sponsorship
Chesapeake Energy recently sponsored Dushore Founder’s Day. The company’s donation helped offset operating costs at the Lions Club’s annual celebration in early August.
Water Access for First Responders
Chesapeake recently worked with regulatory and internal operations teams to provide access to freshwater for first responders in the event of an emergency. The company’s Forksville Freshwater Withdrawal site is now able to provide critical resources to the local fire department.
Strengthening CHOP Partnership
In our continued partnership with CHOP (Child Hunger Outreach Partners), we participated in a number of activities this summer.
Members of the Marcellus team packed bags of food for children in the school districts in our operating area.
Helping the Animals
The Children’s House Support
ESG Update
Sustainability Report Published
In June, Chesapeake published its 2022 Sustainability Report, marking the company’s 11th year reporting on its environmental, social and governance (ESG) performance. This report continues the company’s commitment to transparency, enhanced disclosures and measurable progress. The report provides highlights from our 2022 performance, including:
- Achieved 100% RSG across two major basins: Chesapeake is the first company to certify its natural gas production across two major basins as Responsibly Sourced Gas (RSG). The company delivers approximately 6 bcf/d of gross operated produced volumes of RSG.
- Hired first Chief Sustainability Officer: Reporting directly to the CEO, our Chief Sustainability Officer Usha Turner leads the company’s sustainability strategy and reporting, among other responsibilities. An environmental engineer by training, she brings to the role extensive experience from within the energy industry.
- Improved safety performance across entire workforce: Through focused training and increased safety programs, Chesapeake lowered its employee, contractor and combined (employee and contractor) Total Recordable Incident Rate and Lost-Time Incident Rate. Contractor safety rates improved by approximately 50% year-over-year.
- Enhanced stakeholder relations: Creating multiple communications channels for stakeholders was a priority for Chesapeake in 2022. The company created dedicated stakeholder engagement teams by asset, adopted new technology to better track community engagement and hosted in-person meetings throughout our assets.
Visit our website to view the full 2022 Sustainability Report. For more information on our sustainability efforts, visit chk.com/sustainability, and stay up to date on Chesapeake employees’ related activities on ESG News.