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by Stockwatch Business Reporter
West Texas Intermediate crude for August delivery added $1.21 to $39.70 on the New York Merc, while Brent for August added 69 cents to $41.71 (all figures in this para U.S.). Western Canadian Select traded at a discount of $9.50 to WTI, unchanged. Natural gas for August shot up 21 cents to $1.71. The TSX energy index added 2.49 points to close at 76.96.
Another of the former shale titans has fallen. On Sunday, the 27-year-old shale gas pioneer Chesapeake Energy Corp. (U:CHK) succumbed to its $9-billion (U.S.) debt and filed for Chapter 11 bankruptcy. It has also entered a restructuring arrangement to wipe out about $7-billion (U.S.) of its debt and rejigger its long-term contractual obligations.
President and chief executive officer Doug Lawler kept up a brave face as he vowed that Chesapeake would "emerge from the Chapter 11 process as a stronger and more competitive enterprise." Mr. Lawler took charge in 2013, after the former CEO, the late Aubrey McClendon, was pushed out by Carl Icahn and other activists. (Mr. McClendon died in a car crash in 2016.) Chesapeake at the time was saddled with about $13-billion (U.S.) in debt and $10-billion (U.S.) in other obligations. Mr. Lawler's efforts to right the ship were hindered by persistent commodity price weakness and, more recently, a return to the habit that put Chesapeake so deep in debt in the first place: acquisitions. A little over a year ago, Chesapeake dismayed investors with the unexpected acquisition of WildHorse Resource Development for $4-billion (U.S.). The addition of a "growth platform" was much heralded by Mr. Lawler. "We want this opportunity. We were made for this," he told the press. The deal, financed with a combination of debt and stock, closed in early 2019.
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