CNOOC and Chesapeake announce second shale deal

Production keeps a lid on gas prices

The deal will give CNOOC a stake in Chesapeake’s 800,000 net oil and natural gas leasehold acres in the Denver-Julesburg (DJ) and Powder River Basins in northeast Colorado and southeast Wyoming. It will pay $570 million in cash at closing and will then fund 66.7% of Chesapeake’s drilling and completion costs up to an additional $697 million. Chesapeake expects the transaction to close in the first quarter of 2011, will the additional funding arrangement ending by 2014.

The companies announced a