Chesapeake Energy Corporation Reports Financial And Operational Results For The 2012 Third Quarter

Marcellus Shale (Pennsylvania, West Virginia): With approximately 1.8 million net acres, Chesapeake is the industry’s largest leasehold owner in the Marcellus Shale play, which spans from northern West Virginia across much of Pennsylvania into southern New York.

During the 2012 third quarter, Chesapeake’s average daily net production in the northern dry gas portion of the Marcellus play was 540 mmcfe per day (1,229 gross operated mmcfe per day), an increase of 159% year over year and 9% sequentially. Chesapeake has reduced its operated rig count to five rigs in the northern dry gas portion of the Marcellus and anticipates maintaining that level of activity for the remainder of 2012.

Three notable recent wells completed by Chesapeake in the northern dry gas portion of the Marcellus during the quarter are as follows:

• The Linski S Bra 4H in Bradford County, PA achieved a peak rate of 8.4 mmcf of natural gas per day;
• The Folta N Bra 2H in Bradford County, PA achieved a peak rate of 8.4 mmcf of natural gas per day; and
• The Champluvier 2H in Bradford County, PA achieved a peak rate of 8.3 mmcf of natural gas per day.

During the 2012 third quarter, Chesapeake’s average daily net production in the southern wet gas portion of the play was approximately 125 mmcfe per day (206 gross operated mmcfe per day). Chesapeake is currently drilling with three operated rigs in the southern wet gas portion of the Marcellus and anticipates maintaining that level of activity for the remainder of 2012.

Three notable recent wells completed by Chesapeake in the southern wet gas portion of the Marcellus during the quarter are as follows:

• The Roy Ferrell 8H in Ohio County, WV achieved an initial test rate of approximately 1,525 boe per day, consisting of 5.3 mmcf of natural gas, 220 bbls of oil and 430 bbls of NGL per day;
• The Deborah Craig 3H in Ohio County, WV achieved an initial test rate of approximately 830 boe per day, consisting of 2.6 mmcf of natural gas, 200 bbls of oil and 205 bbls of NGL per day; and
• The George Gantzer 8H in Ohio County, WV achieved an initial test rate of approximately 800 boe per day, consisting of 2.7 mmcf of natural gas, 130 bbls of oil and 220 bbls of NGL per day.

Mississippi Lime (northern Oklahoma, southern Kansas) : Chesapeake’s approximate 2.0 million net acres of leasehold is the industry’s largest position in the Mississippi Lime play in northern Oklahoma and southern Kansas. Production for the 2012 third quarter averaged approximately 25,000 boe per day (30,100 gross operated boe per day), up 211% year over year and 25% sequentially. Approximately 41% of total Mississippi Lime production during the 2012 third quarter was oil, 10% was NGL and 49% was natural gas. As of September 30, 2012, Chesapeake had 227 producing wells in the Mississippi Lime play, which included 73 wells that reached first production in the 2012 third quarter, compared to 49 in the 2012 second quarter and 11 in the 2011 third quarter. Also, as of September 30, 2012, Chesapeake had approximately 55 wells drilled, but not yet producing, that were in various stages of completion and/or waiting on pipeline connection. Chesapeake is currently operating nine rigs in the Mississippi Lime play.

Three notable recent wells completed by Chesapeake in the Mississippi Lime during the quarter are as follows:

• The Herold 3-28-15 1H in Woods County, OK achieved a peak rate of approximately 2,025 boe per day, which included 1,740 bbls of oil, 100 bbls of NGL and 1.1 mmcf of natural gas per day;
• The Rauh 3-26-12 1H in Alfalfa County, OK achieved a peak rate of approximately 2,020 boe per day, which included 1,210 bbls of oil, 225 bbls of NGL and 3.5 mmcf of natural gas per day; and
• The Hada Land & Cattle 3-28-15 1H in Woods County, OK achieved a peak rate of approximately 1,405 boe per day, which included 1,150 bbls of oil, 90 bbls of NGL and 1.0 mmcf of natural gas per day.

Chesapeake continues to pursue a joint venture and/or sale of a portion of its Mississippi Lime leasehold and expects to announce a transaction by year-end 2012.

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