Chesapeake Energy Corporation and BP America Inc. declares that BP has agreed to acquire all of Chesapeake's interests in approximately 90,000 net acres of leasehold and producing natural gas properties in the Arkoma Basin Woodford Shale play for $1.75 billion in cash. The properties, which are located in Atoka, Coal, Hughes and Pittsburg counties, Oklahoma are currently producing approximately 50 million cubic feet of natural gas equivalent (mmcf) per day. The companies anticipate closing the transaction on August 8, 2008.

Aubrey K. McClendon, Chesapeake's Chief Executive Officer, commented, "There was substantial industry interest in our Woodford Shale asset package and we are pleased to announce the sale of these properties to BP. This transaction completes another aspect of our asset monetization program and enables Chesapeake to redeploy capital to our Haynesville, Barnett and Marcellus Shale plays and further improves the company's capital structure. BP has long had a leading position in the Oklahoma natural gas industry and we are very pleased to see its deepening commitment to Oklahoma. We look forward to working with BP on other projects in the future, in addition to current projects such as our Anadarko Basin Joint Venture in which we are drilling a series of Deep Springer wells across a 155 square mile area of mutual interest in Washita County, Oklahoma. Our first well has been logged and looks excellent."

"This purchase is a strategic entry into an attractive and established shale basin with potential resources of up to 2 trillion cubic feet. It complements our extensive unconventional gas plays throughout North America," said Andy Inglis, BP's chief executive of Exploration and Production. "This acquisition has the potential to double our existing production of over 200 mmcf per day from our Arkoma operations."

Tags: BP America Inc., Chesapeake Energy Corporation