Chesapeake Energy profit beats on higher natural gas output - Reuters

Chesapeake Energy profit beats on higher natural gas output | Reuters

Chesapeake Energy profit beats on higher natural gas output

May 2 (Reuters) - U.S. oil and gas company Chesapeake Energy Corp (CHK.O) on Tuesday beat first-quarter profit expectations on higher production of natural gas.

The United States has emerged as the world's largest LNG exporter after Western sanctions on major supplier Russia, boosting demand for U.S. natural gas. According to UBS, 70% of U.S. LNG cargoes went to Europe in the first quarter.

Chesapeake utilized an average of 14 rigs to drill 60 wells and place 53 wells on production during the reported quarter.

The company said in February it would drop three drilling rigs in coming months and would reduce gas output by 4% to 6% this year. The move followed that made by Comstock Resources (CRK.N), which earlier disclosed it would take down two rigs in coming months due to weaker prices.

Chesapeake expects to drill 35 to 45 wells and place 30 to 35 wells on production in the second quarter.

Its net production in the first quarter was about 4.1 billion cubic feet equivalent per day and consisted of about 90% natural gas and 10% total liquids.

Chesapeake struck a 15-year U.S. LNG supply deal with Swiss commodity trader Gunvor Group Ltd in March for up to 2 million tonnes per annum (MTPA) of U.S. liquefied natural gas (LNG).

The Oklahoma City-based company reported adjusted earnings of $1.87 per share, while analysts had expected $1.72 per share, according to Refinitiv data.

Rival shale oil producer Diamondback Energy (FANG.O) on Monday missed Wall Street estimates for quarterly profit on lower prices of crude.

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