Chesapeake Energy Corporation (NYSE:CHK.PRD) Q1 2016 Earnings Conference Call - Final Transcript
May 05, 2016 • 09:00 am ET
Good day, everyone, and welcome to the Chesapeake Energy Corporation Q1 2016 Conference Call. Today's conference is being recorded.
At this time, I would like to turn the call over to Brad Sylvester. Please go ahead.
Bradley D. Sylvester
Thank you, and good morning. And thank you for joining our call today to discuss Chesapeake's financial, and operational results for the 2016 first quarter.
Hopefully you've had a chance to review our press release, and the updated slides that we posted to our website this morning. During this morning's call we will be making forward-looking statements, which consist of statements that cannot be confirmed by reference to existing information, including statements regarding our beliefs, goals, expectations, forecasts, and projections, and future performance, and the assumptions underlying such statements.
Please note that there are a number of factors that will cause actual results to differ materially from our forward-looking statements, including the factors identified, and discussed in our earnings release today and in other SEC filings. Please note that except as required by applicable law, we undertake no duty to update any forward-looking statements, and you should not place undue reliance on such statements.
With me this morning on the call are Doug Lawler, our Chief Executive Officer; Nick Dell'Osso, our Chief Financial Officer; Jason Pigott, our Executive Vice President over the Southern Division; and Frank Patterson, our Executive Vice President of Exploration in the Northern Division. Doug will begin the call, and then turn the call over to Nick for a review of our financial results, before we turn the teleconference over for Q&A.
So with that, thank you. And I now turn the teleconference over to Doug.
Robert Douglas Lawler
Thank you, Brad, and good morning, everyone.
I trust everyone's had an opportunity to review our press release from this morning. We continue to make solid progress in reducing our cost, strengthening our balance sheet, and optimizing our portfolio. Starting with the portfolio, year-to-date we've closed or have under signed purchase, and sale agreements approximately 1.2 billion of gross sales proceeds. This is up approximately 500 million from our earnings call in February.
As previously discussed, certain of these transactions are contingent upon the repurchase of VPPs. So net proceeds from these property sales will be approximately 950 million. On the February earnings call, we guided to an additional 500 million to 1 billion in gross proceeds by year-end 2016. With our announcement this morning, we have already achieved the lower end of that range.
In February we stated that the closed sales, and signed purchase, and sale agreements targeted smaller, non-core, non-operated properties. As noted in today's press release, we're divesting to Newfield Exploration a portion of our STACK acreage position in Northern Oklahoma for approximately $470 million, maintaining the objective of divesting smaller, non-core assets, and in this case principally non-operated acreage.
While we believe the play is highly economic at today's prices, the value acceleration from this currently undeveloped, principally non-operated acreage position is highly accretive, and allows us to direct cash to