Chesapeake (CHK) Drops Energy Leases in Fracking-shy New York
By Edward McAllister Aug 7, 2013, 2:39 PM
Chesapeake Energy (CHK) has given up a two-year legal fight to retain thousands of acres of natural gas drilling leases in New York state, landowner and legal sources told Reuters.
Landowners in Broome and Tioga counties, who had leased acreage to Chesapeake over the past decade, had battled the pioneering oil driller in court to prevent it from extending the leases under their original terms, many of which were agreed to long before a boom in hydraulic fracturing swept the United States.
But Chesapeake is now ready to walk away from the leases, according to a letter some landowners received two weeks ago from their attorney at Levene Gouldin & Thompson, potentially allowing the landowners to renegotiate new deals with other drillers at a higher rate, if New York state eventually ends a five-year fracking ban.
The decision, expected to be finalized next week, is a sign of energy firms’ growing frustration over operating in the Empire State, where most drilling is on hold, and also an indication of how Chesapeake is reining in spending after years of aggressive acreage buying left it with towering debt.
http://wallstreetpit.com/100773-chesapeake-chk-drops-energy-leases-in-fracking-shy-new-york/