Chesapeake Energy to Reduce CapEx by 30%
U.S. oil and gas company Chesapeake Energy Corp said it expects its capital expenses to drop by about 30% in 2020 after it reported a bigger-than-expected loss on Tuesday because of a sharp drop in production and lower natural gas prices.
Chesapeake said it expects capital expenditures of $1.3 billion to $1.6 billion for 2020 that is well below $2.11 billion to $2.31 billion set aside for 2019.
The company also plans to cut its 2020 production costs as well as general and administrative expenses by about 10%, Chesapeake said in a statement.
Investors have been pressurizing oil and gas companies to cut back on spending and return cash to shareholders in the form of dividends and buybacks.
Adjusted net loss attributable to the company was $188 million, or 11 cents per share, in the third quarter ended Sept. 30 from a loss of $8 million, or 1 cent per share, a year earlier.
Analysts on average had expected the company to report a loss of 10 cents per share.
The company's total production fell to 478,000 barrels of oil equivalent per day (boe/d) from 537,000 boe/d a year earlier.
Reporting by Shanti S Nair