Judge approves Chesapeake’s bankruptcy plan
Monday, January 18, 2021
Although there is much to be done before Chesapeake formally emerges from bankruptcy, the company has reached “a critical milestone” in its future, according to an email sent to employees by CEO Doug Lawler on Thursday morning.
Judge David R. Jones approved Chesapeake’s bankruptcy plan, tying a bow around a package of actions that will shed $7 billion of the $8.9 billion Chesapeake owed to creditors when it filed its case.
The company will also exit bankruptcy with $600 million raised through a backstopped equity rights offer and with $2.5 billion in exit financing to fund its ongoing operations.
Learn more: The Oklahoman > A bankruptcy milestone: Chesapeake plan approved, no changes to executive leadership
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Shale FAQ
What is fracking?
Fracking is a slang term for hydraulic fracturing. Fracturing is a process by which highly pressurized fluid is pumped thousands of feet into the ground to fracture rock formations. The goal is to release the natural gas that’s locked inside the rock.
Is it safe?
What most concerns people about fracturing is ground water contamination. The worry is that fractures underground, caused by the process, will extending upwards and into aquifers, releasing gas and chemicals into the ground water supply. There’s been no confirmed reports of such a thing happening. Though surface spills and drill site blowouts can lead to localized environmental concerns.
Will my water catch on fire?
Flammable water is caused by the release of methane gas into a drinking water supply. Methane gas occurs naturally and can be released by any kind of drilling, including water wells. In Pennsylvania officials fined Chesapeake Energy $1 million for contaminating ground water with methane. It was determined that the company had not properly cemented it’s boreholes and gas migrated up the well, between rock and into aquifers.