Chesapeake reduces 2015 capital budget to $3.5-4 billion

In response to lingering low oil and gas prices, Oklahoma City independent Chesapeake Energy Corp. has reduced its 2015 capital budget to $3.5-4 billion, which is a $500 million reduction from its previous guidance of $4-4.5 billion (OGJ Online, Feb. 25, 2015).

Chesapeake plans to operate 25-35 rigs in 2015, which represents a decrease of 55% from an average of 64 rigs in 2014. The company intends to spud and connect to sales about 520 and 650 gross operated wells, respectively, in 2015.

As a result, the company is lowering its targeted 2015 production to 231-236 million boe, or average production of 635,000-645,000 boe/d, which represents 1-3% production growth over the prior year after adjusting for 2014 asset sales.