

	Three Months Ended June 30, 2019
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions except per share data)
REVENUES AND OTHER:
Oil, natural gas and NGL	$	1,454		$	—		$	1,454
Marketing	916			—			916
Total Revenues	2,370			—			2,370
Other	—			15			15
Gains on sales of assets	—			1			1
Total Revenues and Other	2,370			16			2,386
OPERATING EXPENSES:
Oil, natural gas and NGL production	166			—			166
Oil, natural gas and NGL gathering, processing and transportation	271			—			271
Production taxes	40			—			40
Exploration	—			15			15
Marketing	940			—			940
General and administrative	76			13			89
Provisions for legal contingencies, net	3			—			3
Depreciation, depletion and amortization	419			161			580
Impairments	1			—			1
Gain on sale of oil and natural gas properties	(1		)	1			—
Other operating expense	4			(1		)	3
Total Operating Expenses	1,919			189			2,108
INCOME FROM OPERATIONS	451			(173		)	278
OTHER INCOME (EXPENSE):
Interest expense	(131		)	(44		)	(175		)
Losses on investments	(23		)	—			(23		)
Other income	13			5			18
Total Other Expense	(141		)	(39		)	(180		)
INCOME BEFORE INCOME TAXES	310			(212		)	98
Income tax benefit	—			—			—
NET INCOME	310			(212		)	98
Net income attributable to noncontrolling interests	—			—			—
NET INCOME ATTRIBUTABLE TO CHESAPEAKE	310			(212		)	98
Preferred stock dividends	(23		)	—			(23		)
Earnings allocated to participating securities	(1		)	1			—
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	286		$	(211	)	$	75
EARNINGS PER COMMON SHARE:
Basic	$	0.18		$	(0.13	)	$	0.05
Diluted	$	0.18		$	(0.13	)	$	0.05
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions):
Basic	1,628			—			1,628
Diluted	1,628			—			1,628



	Three Months Ended June 30, 2018
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions except per share data)
REVENUES AND OTHER:
Oil, natural gas and NGL	$	982		$	—		$	982
Marketing	1,273			—			1,273
Total Revenues	2,255			—			2,255
Other	—			16			16
Gains on sales of assets	—			18			18
Total Revenues and Other	2,255			34			2,289
OPERATING EXPENSES:
Oil, natural gas and NGL production	138			—			138
Oil, natural gas and NGL gathering, processing and transportation	340			—			340
Production taxes	26			—			26
Exploration	—			20			20
Marketing	1,292			—			1,292
General and administrative	91			14			105
Provision for legal contingencies, net	4			—			4
Depreciation, depletion and amortization	290			181			471
Impairments	46			8			54
Other operating income	(2		)	1			(1		)
Total Operating Expenses	2,225			224			2,449
INCOME (LOSS) FROM OPERATIONS	30			(190		)	(160		)
OTHER INCOME (EXPENSE):
Interest expense	(117		)	(38		)	(155		)
Other income (expense)	62			(5		)	57
Total Other Expense	(55		)	(43		)	(98		)
LOSS BEFORE INCOME TAXES	(25		)	(233		)	(258		)
Income tax benefit	(9		)	—			(9		)
NET LOSS	(16		)	(233		)	(249		)
Net income attributable to noncontrolling interests	(1		)	1			—
NET LOSS ATTRIBUTABLE TO CHESAPEAKE	(17		)	(232		)	(249		)
Preferred stock dividends	(23		)	—			(23		)
NET LOSS AVAILABLE TO COMMON STOCKHOLDERS	$	(40	)	$	(232	)	$	(272	)
LOSS PER COMMON SHARE:
Basic	$	(0.04	)	$	(0.26	)	$	(0.30	)
Diluted	$	(0.04	)	$	(0.26	)	$	(0.30	)
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions):
Basic	909			—			909
Diluted	909			—			909



	Six Months Ended June 30, 2019
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions except per share data)
REVENUES AND OTHER:
Oil, natural gas and NGL	$	2,383		$	—		$	2,383
Marketing	2,149			—			2,149
Total Revenues	4,532			—			4,532
Other	—			30			30
Gains on sales of assets	—			20			20
Total Revenues and Other	4,532			50			4,582
OPERATING EXPENSES:
Oil, natural gas and NGL production	298			—			298
Oil, natural gas and NGL gathering, processing and transportation	545			—			545
Production taxes	74			—			74
Exploration	—			39			39
Marketing	2,170			—			2,170
General and administrative	164			28			192
Provision for legal contingencies	3			—			3
Depreciation, depletion and amortization	776			323			1,099
Gain on sale of oil and natural gas properties	(10		)	10			—
Impairments	2			—			2
Other operating expense	64			—			64
Total Operating Expenses	4,086			400			4,486
INCOME FROM OPERATIONS	446			(350		)	96
OTHER INCOME (EXPENSE):
Interest expense	(266		)	(70		)	(336		)
Losses on investments	(24		)	—			(24		)
Other income	20			7			27
Total Other Expense	(270		)	(63		)	(333		)
INCOME (LOSS) BEFORE INCOME TAXES	176			(413		)	(237		)
Income tax benefit	(314		)	—			(314		)
NET INCOME	490			(413		)	77
Net income attributable to noncontrolling interests	(1		)	1			—
NET INCOME ATTRIBUTABLE TO CHESAPEAKE	489			(412		)	77
Preferred stock dividends	(46		)	—			(46		)
Earnings allocated to participating securities	(3		)	3			—
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	440		$	(409	)	$	31
EARNINGS PER COMMON SHARE:
Basic	$	0.29		$	(0.27	)	$	0.02
Diluted	$	0.29		$	(0.27	)	$	0.02
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions):
Basic	1,505			—			1,505
Diluted	1,505			—			1,505



	Six Months Ended June 30, 2018
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions except per share data)
REVENUES AND OTHER:
Oil, natural gas and NGL	$	2,225		$	—		$	2,225
Marketing	2,519			—			2,519
Total Revenues	4,744			—			4,744
Other	—			32			32
Gains on sales of assets	—			37			37
Total Revenues and Other	4,744			69			4,813
OPERATING EXPENSES:
Oil, natural gas and NGL production	285			—			285
Oil, natural gas and NGL gathering, processing and transportation	696			—			696
Production taxes	57			—			57
Exploration	—			101			101
Marketing	2,560			—			2,560
General and administrative	163			29			192
Restructuring and other termination costs	38			—			38
Provision for legal contingencies, net	9			—			9
Depreciation, depletion and amortization	576			354			930
Impairments	46			18			64
Other operating (income) expense	6			(7		)	(1		)
Total Operating Expenses	4,436			495			4,931
INCOME (LOSS) FROM OPERATIONS	308			(426		)	(118		)
OTHER INCOME (EXPENSE):
Interest expense	(240		)	(77		)	(317		)
Gains on investments	139			—			139
Other income	62			(6		)	56
Total Other Expense	(39		)	(83		)	(122		)
INCOME (LOSS) BEFORE INCOME TAXES	269			(509		)	(240		)
Income tax benefit	(9		)	—			(9		)
NET INCOME (LOSS)	278			(509		)	(231		)
Net income attributable to noncontrolling interests	(2		)	1			(1		)
NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE	276			(508		)	(232		)
Preferred stock dividends	(46		)	—			(46		)
Earnings allocated to participating securities	(2		)	2			—
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS	$	228		$	(506	)	$	(278	)
EARNINGS (LOSS) PER COMMON SHARE:
Basic	$	0.25		$	(0.56	)	$	(0.31	)
Diluted	$	0.25		$	(0.56	)	$	(0.31	)
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions):
Basic	908			—			908
Diluted	908			—			908



	Three Months Ended June 30, 2019
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME	Under Full Cost		Successful Efforts Adjustment			Under Successful Efforts
	($ in millions)
NET INCOME	$	310	$	(212	)	$	98
OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX:
Unrealized gains on derivative instruments	—		—			—
Reclassification of losses on settled derivative instruments	8		—			8
Other Comprehensive Income	8		—			8
COMPREHENSIVE INCOME	318		(212		)	106
COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS	—		—			—
COMPREHENSIVE INCOME ATTRIBUTABLE TO CHESAPEAKE	$	318	$	(212	)	$	106



	Three Months Ended June 30, 2018
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions)
NET LOSS	$	(16	)	$	(233	)	$	(249	)
OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX:
Unrealized gains on derivative instruments	—			—			—
Reclassification of losses on settled derivative instruments	7			—			7
Other Comprehensive Income	7			—			7
COMPREHENSIVE LOSS	(9		)	(233		)	(242		)
COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS	(1		)	1			—
COMPREHENSIVE LOSS ATTRIBUTABLE TO CHESAPEAKE	$	(10	)	$	(232	)	$	(242	)



	Six Months Ended June 30, 2019
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions)
NET INCOME (LOSS)	$	490		$	(413	)	$	77
OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX:
Unrealized gains on derivative instruments	—			—			—
Reclassification of losses on settled derivative instruments	18			—			18
Other Comprehensive Income	18			—			18
COMPREHENSIVE INCOME	508			(413		)	95
COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS	(1		)	1			—
COMPREHENSIVE INCOME ATTRIBUTABLE TO CHESAPEAKE	$	507		$	(412	)	$	95



	Six Months Ended June 30, 2018
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions)
NET INCOME (LOSS)	$	278		$	(509	)	$	(231	)
OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX:
Unrealized gains on derivative instruments	—			—			—
Reclassification of losses on settled derivative instruments	17			—			17
Other Comprehensive Income	17			—			17
COMPREHENSIVE INCOME (LOSS)	295			(509		)	(214		)
COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS	(2		)	1			(1		)
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE	$	293		$	(508	)	$	(215	)




	Six Months Ended June 30, 2019
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions)
CASH FLOWS FROM OPERATING ACTIVITIES:
NET INCOME	$	490		$	(413	)	$	77
ADJUSTMENTS TO RECONCILE NET INCOME TO CASH PROVIDED BY OPERATING ACTIVITIES:
Depreciation, depletion and amortization	776			323			1,099
Deferred income tax benefit	(314		)	—			(314		)
Derivative losses, net	30			—			30
Cash receipts on derivative settlements, net	15			—			15
Stock-based compensation	17			—			17
Gains on sales of assets	—			(20		)	(20		)
Impairments	2			—			2
Exploration	—			25			25
Losses on investments	18			—			18
Other	31			10			41
Changes in assets and liabilities	(107		)	(30		)	(137		)
Net Cash Provided By Operating Activities	958			(105		)	853
CASH FLOWS FROM INVESTING ACTIVITIES:
Drilling and completion costs	(1,104		)	34			(1,070		)
Business combination, net	(353		)	—			(353		)
Acquisitions of proved and unproved properties	(88		)	71			(17		)
Proceeds from divestitures of proved and unproved properties	82			—			82
Additions to other property and equipment	(18		)	—			(18		)
Proceeds from sales of other property and equipment	4			—			4
Net Cash Used In Investing Activities	(1,477		)	105			(1,372		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from revolving credit facility borrowings	6,416			—			6,416
Payments on revolving credit facility borrowings	(5,452		)	—			(5,452		)
Cash paid to purchase debt	(381		)	—			(381		)
Cash paid for preferred stock dividends	(46		)	—			(46		)
Distributions to noncontrolling interest owners	(2		)	—			(2		)
Other	(16		)	—			(16		)
Net Cash Provided By Financing Activities	519			—			519
Net increase in cash and cash equivalents	—			—			—
Cash and cash equivalents, beginning of period	4			—			4
Cash and cash equivalents, end of period	$	4		$	—		$	4




	Six Months Ended June 30, 2018
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions)
CASH FLOWS FROM OPERATING ACTIVITIES:
NET INCOME (LOSS)	$	278		$	(509	)	$	(231	)
ADJUSTMENTS TO RECONCILE NET INCOME (LOSS) TO CASH PROVIDED BY OPERATING ACTIVITIES:
Depreciation, depletion and amortization	576			354			930
Deferred income tax benefit	(9		)	—			(9		)
Derivative losses, net	368			—			368
Cash payments on derivative settlements, net	(55		)	—			(55		)
Stock-based compensation	18			—			18
Gains on sales of assets	—			(37		)	(37		)
Impairments	46			18			64
Exploration	—			73			73
Gains on investments	(139		)	—			(139		)
Other	(86		)	(7		)	(93		)
Changes in assets and liabilities	94			(32		)	62
Net Cash Provided By Operating Activities	1,091			(140		)	951
CASH FLOWS FROM INVESTING ACTIVITIES:
Drilling and completion costs	(979		)	51			(928		)
Acquisitions of proved and unproved properties	(191		)	89			(102		)
Proceeds from divestitures of proved and unproved properties	384			—			384
Additions to other property and equipment	(5		)	—			(5		)
Proceeds from sales of other property and equipment	74			—			74
Proceeds from sales of investments	74			—			74
Net Cash Used In Investing Activities	(643		)	140			(503		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from revolving credit facility borrowings	6,118			—			6,118
Payments on revolving credit facility borrowings	(6,393		)	—			(6,393		)
Extinguishment of other financing	(122		)	—			(122		)
Cash paid for preferred stock dividends	(46		)	—			(46		)
Distributions to noncontrolling interest owners	(3		)	—			(3		)
Other	(4		)	—			(4		)
Net Cash Used In Financing Activities	(450		)	—			(450		)
Net decrease in cash and cash equivalents	(2		)	—			(2		)
Cash and cash equivalents, beginning of period	5			—			5
Cash and cash equivalents, end of period	$	3		$	—		$	3



	Three Months Ended June 30, 2019
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions)
PREFERRED STOCK:
Balance, beginning and end of period	$	1,671		$	—		$	1,671
COMMON STOCK:
Balance, beginning and end of period	16			—			16
ADDITIONAL PAID-IN CAPITAL:
Balance, beginning of period	16,392			—			16,392
Stock-based compensation	11			—			11
Dividends on preferred stock	(23		)	—			(23		)
Balance, end of period	16,380			—			16,380
ACCUMULATED DEFICIT:
Balance, beginning of period	(15,481		)	1,548			(13,933		)
Net income attributable to Chesapeake	310			(212		)	98
Balance, end of period	(15,171		)	1,336			(13,835		)
ACCUMULATED OTHER COMPREHENSIVE LOSS:
Balance, beginning of period	(13		)	—			(13		)
Hedging activity	8			—			8
Balance, end of period	(5		)	—			(5		)
TREASURY STOCK – COMMON:
Balance, beginning of period	(36		)	—			(36		)
Purchase of 81,093 shares for company benefit plans	(1		)	—			(1		)
Release of 148,767 shares from company benefit plans	1			—			1
Balance, end of period	(36		)	—			(36		)
TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY	2,855			1,336			4,191
NONCONTROLLING INTERESTS:
Balance, beginning of period	122			(81		)	41
Net income attributable to noncontrolling interests	—			—			—
Distributions to noncontrolling interest owners	(2		)	—			(2		)
Balance, end of period	120			(81		)	39
TOTAL EQUITY	$	2,975		$	1,255		$	4,230



	Three Months Ended June 30, 2018
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions)
PREFERRED STOCK:
Balance, beginning and end of period	$	1,671		$	—		$	1,671
COMMON STOCK:
Balance, beginning of period	9			—			9
ADDITIONAL PAID-IN CAPITAL:
Balance, beginning of period	14,419			—			14,419
Stock-based compensation	12			—			12
Dividends on preferred stock	(23		)	—			(23		)
Balance, end of period	14,408			—			14,408
ACCUMULATED DEFICIT:
Balance, beginning of period	(16,240		)	2,119			(14,121		)
Net loss attributable to Chesapeake	(17		)	(232		)	(249		)
Balance, end of period	(16,257		)	1,887			(14,370		)
ACCUMULATED OTHER COMPREHENSIVE LOSS:
Balance, beginning of period	(47		)	—			(47		)
Hedging activity	7			—			7
Balance, end of period	(40		)	—			(40		)
TREASURY STOCK – COMMON:
Balance, beginning of period	(32		)	—			(32		)
Purchase of 17,046 shares for company benefit plans	—			—			—
Release of 114,450 shares from company benefit plans	1			—			1
Balance, end of period	(31		)	—			(31		)
TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY (DEFICIT)	(240		)	1,887			1,647
NONCONTROLLING INTERESTS:
Balance, beginning of period	123			(80		)	43
Net income attributable to noncontrolling interests	1			(1		)	—
Distributions to noncontrolling interest owners	(1		)	—			(1		)
Balance, end of period	123			(81		)	42
TOTAL EQUITY (DEFICIT)	$	(117	)	$	1,806		$	1,689



	Six Months Ended June 30, 2019
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions)
PREFERRED STOCK:
Balance, beginning and end of period	$	1,671		$	—		$	1,671
COMMON STOCK:
Balance, beginning of period	9			—			9
Common shares issued for WildHorse Merger	7			—			7
Balance, end of period	16			—			16
ADDITIONAL PAID-IN CAPITAL:
Balance, beginning of period	14,378			—			14,378
Common shares issued for WildHorse Merger	2,030			—			2,030
Stock-based compensation	18			—			18
Dividends on preferred stock	(46		)	—			(46		)
Balance, end of period	16,380			—			16,380
ACCUMULATED DEFICIT:
Balance, beginning of period	(15,660		)	1,748			(13,912		)
Net income attributable to Chesapeake	489			(412		)	77
Balance, end of period	(15,171		)	1,336			(13,835		)
ACCUMULATED OTHER COMPREHENSIVE LOSS:
Balance, beginning of period	(23		)	—			(23		)
Hedging activity	18			—			18
Balance, end of period	(5		)	—			(5		)
TREASURY STOCK – COMMON:
Balance, beginning of period	(31		)	—			(31		)
Purchase of 2,620,566 shares for company benefit plans	(7		)	—			(7		)
Release of 259,563 shares from company benefit plans	2			—			2
Balance, end of period	(36		)	—			(36		)
TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY	2,855			1,336			4,191
NONCONTROLLING INTERESTS:
Balance, beginning of period	123			(82		)	41
Net income attributable to noncontrolling interests	(1		)	1			—
Distributions to noncontrolling interest owners	(2		)	—			(2		)
Balance, end of period	120			(81		)	39
TOTAL EQUITY	$	2,975		$	1,255		$	4,230



	Six Months Ended June 30, 2018
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY	Under Full Cost			Successful Efforts Adjustment			Under Successful Efforts
	($ in millions)
PREFERRED STOCK:
Balance, beginning and end of period	$	1,671		$	—		$	1,671
COMMON STOCK:
Balance, beginning and end of period	9			—			9
ADDITIONAL PAID-IN CAPITAL:
Balance, beginning of period	14,437			—			14,437
Stock-based compensation	17			—			17
Dividends on preferred stock	(46		)	—			(46		)
Balance, end of period	14,408			—			14,408
ACCUMULATED DEFICIT:
Balance, beginning of period	(16,525		)	2,395			(14,130		)
Net income (loss) attributable to Chesapeake	276			(508		)	(232		)
Cumulative effect of accounting change	(8		)	—			(8		)
Balance, end of period	(16,257		)	1,887			(14,370		)
ACCUMULATED OTHER COMPREHENSIVE LOSS:
Balance, beginning of period	(57		)	—			(57		)
Hedging activity	17			—			17
Balance, end of period	(40		)	—			(40		)
TREASURY STOCK – COMMON:
Balance, beginning of period	(31		)	—			(31		)
Purchase of 1,468,524 shares for company benefit plans	(4		)	—			(4		)
Release of 389,857 shares from company benefit plans	4			—			4
Balance, end of period	(31		)	—			(31		)
TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY (DEFICIT)	(240		)	1,887			1,647
NONCONTROLLING INTERESTS:
Balance, beginning of period	124			(80		)	44
Net income attributable to noncontrolling interests	2			(1		)	1
Distributions to noncontrolling interest owners	(3		)	—			(3		)
Balance, end of period	123			(81		)	42
TOTAL EQUITY (DEFICIT)	$	(117	)	$	1,806		$	1,689