Chesapeake Energy Corporation has closed the sale of its Arkoma Basin Woodford Shale assets to BP America Inc. for approximately $1.7 billion in cash.

Aubrey K. McClendon, Chesapeake's Chief Executive Officer, commented, "We are pleased to announce the completion of the sale of our Arkoma Woodford properties to BP. This transaction was an important aspect of our ongoing 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.

"We now turn our focus to negotiating joint venture arrangements in the Fayetteville and Marcellus Shale plays. We anticipate selling 25% of our interest in those two plays using a "PXP-style" transaction in which we receive partial consideration in cash at closing and then receive a tax-efficient carry of development costs over time as wells are drilled. There is strong industry interest in both plays and also in our preferred deal structure. Accordingly, we hope to announce transaction details by the end of the third quarter."

Tags: BP America Inc., Chesapeake Energy Corporation