Chesapeake (CHK) rose another 1% on Wednesday on the heels of a strong gain on Tuesday related to its sale of a chunk of the Utica shale play to Total (TOT).
On Wednesday, the company announced that it had made progress in achieving its 30/25 plan to increase production and reduce debt.
“In the first year of the plan, Chesapeake achieved more than 70% of its two-year goal and reduced its long-term debt (net of cash) per unit of proved reserves from $0.73 per thousand cubic feet of natural gas equivalent (mcfe) to approximately $0.55 per mcfe, a debt per mcfe reduction of 25% in just one year,” the company said in a statement.
That said, the low price of natural gas could imperil the company’s plans to increase production: “[I]f natural gas prices remain at currently depressed levels, Chesapeake will further reduce its drilling capital expenditures on dry natural gas plays, which would likely decrease its projected natural gas production and could reduce its two-year production growth target below 30%.”
Cabot Oil & Gas (COG) also rose 2.5% on Wednesday after announcing a stock split scheduled for Jan. 17 and an increase in its annual dividend to 16 cents from 12 cents per share.
The rest of the sector was mixed, and the NYSE Arca Natural Gas Index was recently flat.
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