(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||
(Address of principal executive offices) | (Zip Code) | |||
(Registrant’s telephone number, including area code) | ||||
Securities Registered Pursuant to Section 12(b) of the Act: | ||||
Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | ||
PART I. FINANCIAL INFORMATION | Page | |||
Item 1. | ||||
Condensed Consolidated Balance Sheets as of September 30, 2019 and December 31, 2018 | ||||
for the Three and Nine Months Ended September 30, 2019 and 2018 | ||||
for the Three and Nine Months Ended September 30, 2019 and 2018 | ||||
for the Nine Months Ended September 30, 2019 and 2018 | ||||
for the Three and Nine Months Ended September 30, 2019 and 2018 | ||||
Item 2. | ||||
Item 3. | ||||
Item 4. | ||||
PART II. OTHER INFORMATION | ||||
Item 1. | ||||
Item 1A. | ||||
Item 2. | ||||
Item 3. | ||||
Item 4. | ||||
Item 5. | ||||
Item 6. | ||||
ITEM 1. | Condensed Consolidated Financial Statements |
September 30, 2019 | December 31, 2018 | |||||||
($ in millions) | ||||||||
CURRENT ASSETS: | ||||||||
Cash and cash equivalents ($2 and $1 attributable to our VIE) | $ | $ | ||||||
Accounts receivable, net | ||||||||
Short-term derivative assets | ||||||||
Other current assets | ||||||||
Total Current Assets | ||||||||
PROPERTY AND EQUIPMENT: | ||||||||
Oil and natural gas properties, at cost based on successful efforts accounting: | ||||||||
Proved oil and natural gas properties ($755 and $755 attributable to our VIE) | ||||||||
Unproved properties | ||||||||
Other property and equipment | ||||||||
Total Property and Equipment, at Cost | ||||||||
Less: accumulated depreciation, depletion and amortization (($711) and ($707) attributable to our VIE) | ( | ) | ( | ) | ||||
Property and equipment held for sale, net | ||||||||
Total Property and Equipment, Net | ||||||||
LONG-TERM ASSETS: | ||||||||
Long-term derivative assets | ||||||||
Other long-term assets | ||||||||
TOTAL ASSETS | $ | $ | ||||||
September 30, 2019 | December 31, 2018 | |||||||
($ in millions) | ||||||||
CURRENT LIABILITIES: | ||||||||
Accounts payable | $ | $ | ||||||
Current maturities of long-term debt, net | ||||||||
Accrued interest | ||||||||
Short-term derivative liabilities | ||||||||
Other current liabilities ($1 and $2 attributable to our VIE) | ||||||||
Total Current Liabilities | ||||||||
LONG-TERM LIABILITIES: | ||||||||
Long-term debt, net | ||||||||
Asset retirement obligations, net of current portion | ||||||||
Other long-term liabilities | ||||||||
Total Long-Term Liabilities | ||||||||
CONTINGENCIES AND COMMITMENTS (Note 7) | ||||||||
EQUITY: | ||||||||
Chesapeake Stockholders’ Equity: | ||||||||
Preferred stock, $0.01 par value, 20,000,000 shares authorized: 5,563,458 and 5,603,458 shares outstanding | ||||||||
Common stock, $0.01 par value, 3,000,000,000 and 2,000,000,000 shares authorized: 1,954,150,951 and 913,715,512 shares issued | ||||||||
Additional paid-in capital | ||||||||
Accumulated deficit | ( | ) | ( | ) | ||||
Accumulated other comprehensive income (loss) | ( | ) | ||||||
Less: treasury stock, at cost; 5,623,592 and 3,246,553 common shares | ( | ) | ( | ) | ||||
Total Chesapeake Stockholders’ Equity | ||||||||
Noncontrolling interests | ||||||||
Total Equity | ||||||||
TOTAL LIABILITIES AND EQUITY | $ | $ | ||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018* | 2019 | 2018* | |||||||||||||
($ in millions except per share data) | ||||||||||||||||
REVENUES AND OTHER: | ||||||||||||||||
Oil, natural gas and NGL | $ | $ | $ | $ | ||||||||||||
Marketing | ||||||||||||||||
Total Revenues | ||||||||||||||||
Other | ||||||||||||||||
Gains (losses) on sales of assets | ( | ) | ||||||||||||||
Total Revenues and Other | ||||||||||||||||
OPERATING EXPENSES: | ||||||||||||||||
Oil, natural gas and NGL production | ||||||||||||||||
Oil, natural gas and NGL gathering, processing and transportation | ||||||||||||||||
Production taxes | ||||||||||||||||
Exploration | ||||||||||||||||
Marketing | ||||||||||||||||
General and administrative | ||||||||||||||||
Restructuring and other termination costs | ||||||||||||||||
Provision for legal contingencies, net | ||||||||||||||||
Depreciation, depletion and amortization | ||||||||||||||||
Impairments | ||||||||||||||||
Other operating (income) expense | ( | ) | ||||||||||||||
Total Operating Expenses | ||||||||||||||||
INCOME (LOSS) FROM OPERATIONS | ( | ) | ||||||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Gains (losses) on investments | ( | ) | ( | ) | ||||||||||||
Gains (losses) on purchases or exchanges of debt | ( | ) | ( | ) | ||||||||||||
Other income | ||||||||||||||||
Total Other Expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
LOSS BEFORE INCOME TAXES | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Income tax expense (benefit) | ( | ) | ( | ) | ( | ) | ||||||||||
NET INCOME (LOSS) | ( | ) | ( | ) | ( | ) | ||||||||||
Net income attributable to noncontrolling interests | ( | ) | ||||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | ( | ) | ( | ) | ( | ) | ||||||||||
Preferred stock dividends | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Loss on exchange of preferred stock | ( | ) | ( | ) | ||||||||||||
NET LOSS AVAILABLE TO COMMON STOCKHOLDERS | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
LOSS PER COMMON SHARE: | ||||||||||||||||
Basic | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
Diluted | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions): | ||||||||||||||||
Basic | ||||||||||||||||
Diluted | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018* | 2019 | 2018* | |||||||||||||
($ in millions) | ||||||||||||||||
NET INCOME (LOSS) | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||
OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX: | ||||||||||||||||
Unrealized gains on derivative instruments(a) | ||||||||||||||||
Reclassification of losses on settled derivative instruments(a) | ||||||||||||||||
Other Comprehensive Income | ||||||||||||||||
COMPREHENSIVE INCOME (LOSS) | ( | ) | ( | ) | ( | ) | ||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS | ( | ) | ||||||||||||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||
(a) | Deferred tax activity incurred in other comprehensive income was offset by a valuation allowance. |
Nine Months Ended September 30, | ||||||||
2019 | 2018* | |||||||
($ in millions) | ||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
NET INCOME (LOSS) | $ | $ | ( | ) | ||||
ADJUSTMENTS TO RECONCILE NET INCOME (LOSS) TO CASH PROVIDED BY OPERATING ACTIVITIES: | ||||||||
Depreciation, depletion and amortization | ||||||||
Deferred income tax benefit | ( | ) | ( | ) | ||||
Derivative (gains) losses, net | ( | ) | ||||||
Cash receipts (payments) on derivative settlements, net | ( | ) | ||||||
Stock-based compensation | ||||||||
Gains on sales of assets | ( | ) | ( | ) | ||||
Impairments | ||||||||
Exploration | ||||||||
(Gains) losses on investments | ( | ) | ||||||
(Gains) losses on purchases or exchanges of debt | ( | ) | ||||||
Other | ( | ) | ||||||
Changes in assets and liabilities | ( | ) | ||||||
Net Cash Provided By Operating Activities | ||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Drilling and completion costs | ( | ) | ( | ) | ||||
Business combination, net | ( | ) | ||||||
Acquisitions of proved and unproved properties | ( | ) | ( | ) | ||||
Proceeds from divestitures of proved and unproved properties | ||||||||
Additions to other property and equipment | ( | ) | ( | ) | ||||
Proceeds from sales of other property and equipment | ||||||||
Proceeds from sales of investments | ||||||||
Net Cash Used In Investing Activities | ( | ) | ( | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Proceeds from revolving credit facility borrowings | ||||||||
Payments on revolving credit facility borrowings | ( | ) | ( | ) | ||||
Proceeds from issuance of senior notes, net | ||||||||
Cash paid to purchase debt | ( | ) | ( | ) | ||||
Extinguishment of other financing | ( | ) | ||||||
Cash paid for preferred stock dividends | ( | ) | ( | ) | ||||
Distributions to noncontrolling interest owners | ( | ) | ( | ) | ||||
Other | ( | ) | ( | ) | ||||
Net Cash Provided By (Used In) Financing Activities | ( | ) | ||||||
Net increase (decrease) in cash and cash equivalents | ( | ) | ||||||
Cash and cash equivalents, beginning of period | ||||||||
Cash and cash equivalents, end of period | $ | $ | ||||||
Supplemental disclosures to the condensed consolidated statements of cash flows are presented below: | ||||||||
Nine Months Ended September 30, | ||||||||
2019 | 2018* | |||||||
($ in millions) | ||||||||
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||||
Interest paid, net of capitalized interest | $ | $ | ||||||
Income taxes paid, net of refunds received | $ | ( | ) | $ | ( | ) | ||
SUPPLEMENTAL DISCLOSURE OF SIGNIFICANT NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
Common stock issued for business combination | $ | $ | ||||||
Debt exchanged for common stock | $ | $ | ||||||
Preferred stock exchanged for common stock | $ | $ | ||||||
Change in senior notes exchanged | $ | $ | ||||||
Change in accrued drilling and completion costs | $ | $ | ||||||
Change in divested proved and unproved properties | $ | ( | ) | $ | ( | ) | ||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018* | 2019 | 2018* | |||||||||||||
($ in millions) | ||||||||||||||||
PREFERRED STOCK: | ||||||||||||||||
Balance, beginning of period | $ | $ | $ | $ | ||||||||||||
Exchange of 40,000, 0, 40,000 and 0 shares of preferred stock for common stock | ( | ) | ( | ) | ||||||||||||
Balance, end of period | ||||||||||||||||
COMMON STOCK: | ||||||||||||||||
Balance, beginning of period | ||||||||||||||||
Common shares issued for WildHorse Merger | ||||||||||||||||
Exchange of senior notes and convertible senior notes | ||||||||||||||||
Balance, end of period | ||||||||||||||||
ADDITIONAL PAID-IN CAPITAL: | ||||||||||||||||
Balance, beginning of period | ||||||||||||||||
Common shares issued for WildHorse Merger | ||||||||||||||||
Exchange of preferred stock for 10,367,950, 0 10,367,950 and 0 shares of common stock | ||||||||||||||||
Exchange of senior notes for 235,563,519, 0 235,563,519 and 0 shares of common stock | ||||||||||||||||
Exchange of convertible senior notes for 73,389,094, 0, 73,389,094 and 0 shares of common stock | ||||||||||||||||
Equity component of convertible notes repurchases | ( | ) | ( | ) | ||||||||||||
Stock-based compensation | ||||||||||||||||
Dividends on preferred stock | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Balance, end of period | ||||||||||||||||
ACCUMULATED DEFICIT: | ||||||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Net income (loss) attributable to Chesapeake | ( | ) | ( | ) | ( | ) | ||||||||||
Cumulative effect of accounting change | — | — | ( | ) | ||||||||||||
Balance, end of period | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | ||||||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Hedging activity | ||||||||||||||||
Balance, end of period | ( | ) | ( | ) | ||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018* | 2019 | 2018* | |||||||||||||
($ in millions) | ||||||||||||||||
TREASURY STOCK – COMMON: | ||||||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Purchase of 53,337, 30,509, 2,673,903, and 1,499,033 shares for company benefit plans | ( | ) | ( | ) | ||||||||||||
Release of 37,301, 41,617, 296,864 and 431,474 shares from company benefit plans | ||||||||||||||||
Balance, end of period | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY | ||||||||||||||||
NONCONTROLLING INTERESTS: | ||||||||||||||||
Balance, beginning of period | ||||||||||||||||
Net income attributable to noncontrolling interests | ||||||||||||||||
Distributions to noncontrolling interest owners | ( | ) | ( | ) | ( | ) | ||||||||||
Balance, end of period | ||||||||||||||||
TOTAL EQUITY | $ | $ | $ | $ | ||||||||||||
1. | Basis of Presentation and Summary of Significant Accounting Policies |
2. | Change in Accounting Principle |
Three Months Ended September 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 | $ | $ | $ | |||||||||
Marketing | ||||||||||||
Total Revenues | ||||||||||||
Other | ||||||||||||
Gains on sales of assets | ||||||||||||
Total Revenues and Other | ||||||||||||
OPERATING EXPENSES: | ||||||||||||
Oil, natural gas and NGL production | ||||||||||||
Oil, natural gas and NGL gathering, processing and transportation | ||||||||||||
Production taxes | ||||||||||||
Exploration | ||||||||||||
Marketing | ||||||||||||
General and administrative | ||||||||||||
Depreciation, depletion and amortization | ||||||||||||
Impairments | ||||||||||||
Other operating expense | ||||||||||||
Total Operating Expenses | ||||||||||||
INCOME FROM OPERATIONS | ( | ) | ||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | ||||||
Losses on investments | ( | ) | ( | ) | ||||||||
Gains on purchases or exchanges of debt | ||||||||||||
Other income | ||||||||||||
Total Other Expense | ( | ) | ( | ) | ( | ) | ||||||
INCOME (LOSS) BEFORE INCOME TAXES | ( | ) | ( | ) | ||||||||
Income tax benefit | ( | ) | ( | ) | ||||||||
NET INCOME (LOSS) | ( | ) | ( | ) | ||||||||
Net loss attributable to noncontrolling interests | ||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | ( | ) | ( | ) | ||||||||
Preferred stock dividends | ( | ) | ( | ) | ||||||||
Loss on exchange of preferred stock | ( | ) | ( | ) | ||||||||
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS | $ | $ | ( | ) | $ | ( | ) | |||||
EARNINGS (LOSS) PER COMMON SHARE: | ||||||||||||
Basic | $ | $ | ( | ) | $ | ( | ) | |||||
Diluted | $ | $ | ( | ) | $ | ( | ) | |||||
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions): | ||||||||||||
Basic | ||||||||||||
Diluted | ||||||||||||
Three Months Ended September 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 | $ | $ | $ | |||||||||
Marketing | ||||||||||||
Total Revenues | ||||||||||||
Other | ||||||||||||
Losses on sales of assets | ( | ) | ( | ) | ||||||||
Total Revenues and Other | ||||||||||||
OPERATING EXPENSES: | ||||||||||||
Oil, natural gas and NGL production | ||||||||||||
Oil, natural gas and NGL gathering, processing and transportation | ||||||||||||
Production taxes | ||||||||||||
Exploration | ||||||||||||
Marketing | ||||||||||||
General and administrative | ||||||||||||
Provision for legal contingencies, net | ||||||||||||
Depreciation, depletion and amortization | ||||||||||||
Impairments | ||||||||||||
Total Operating Expenses | ||||||||||||
INCOME FROM OPERATIONS | ( | ) | ||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | ||||||
Losses on purchases or exchanges of debt | ( | ) | ( | ) | ||||||||
Other income | ||||||||||||
Total Other Expense | ( | ) | ( | ) | ( | ) | ||||||
INCOME (LOSS) BEFORE INCOME TAXES | ( | ) | ( | ) | ||||||||
Income tax expense | ||||||||||||
NET INCOME (LOSS) | ( | ) | ( | ) | ||||||||
Net income attributable to noncontrolling interests | ( | ) | ||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | ( | ) | ( | ) | ||||||||
Preferred stock dividends | ( | ) | ( | ) | ||||||||
Earnings allocated to participating securities | ( | ) | ||||||||||
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS | $ | $ | ( | ) | $ | ( | ) | |||||
EARNINGS (LOSS) PER COMMON SHARE: | ||||||||||||
Basic | $ | $ | ( | ) | $ | ( | ) | |||||
Diluted | $ | $ | ( | ) | $ | ( | ) | |||||
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions): | ||||||||||||
Basic | ||||||||||||
Diluted | ( | ) | ||||||||||
Nine Months Ended September 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 | $ | $ | $ | |||||||||
Marketing | ||||||||||||
Total Revenues | ||||||||||||
Other | ||||||||||||
Gains on sales of assets | ||||||||||||
Total Revenues and Other | ||||||||||||
OPERATING EXPENSES: | ||||||||||||
Oil, natural gas and NGL production | ||||||||||||
Oil, natural gas and NGL gathering, processing and transportation | ||||||||||||
Production taxes | ||||||||||||
Exploration | ||||||||||||
Marketing | ||||||||||||
General and administrative | ||||||||||||
Provision for legal contingencies | ||||||||||||
Depreciation, depletion and amortization | ||||||||||||
Gain on sale of oil and natural gas properties | ( | ) | ||||||||||
Impairments | ||||||||||||
Other operating expense | ||||||||||||
Total Operating Expenses | ||||||||||||
INCOME FROM OPERATIONS | ( | ) | ||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | ||||||
Losses on investments | ( | ) | ( | ) | ||||||||
Gains on purchases or exchanges of debt | ||||||||||||
Other income | ||||||||||||
Total Other Expense | ( | ) | ( | ) | ( | ) | ||||||
INCOME (LOSS) BEFORE INCOME TAXES | ( | ) | ( | ) | ||||||||
Income tax benefit | ( | ) | ( | ) | ||||||||
NET INCOME | ( | ) | ||||||||||
Net income attributable to noncontrolling interests | ( | ) | ||||||||||
NET INCOME ATTRIBUTABLE TO CHESAPEAKE | ( | ) | ||||||||||
Preferred stock dividends | ( | ) | ( | ) | ||||||||
Loss on exchange of preferred stock | ( | ) | ( | ) | ||||||||
Earnings allocated to participating securities | ( | ) | ||||||||||
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS | $ | $ | ( | ) | $ | ( | ) | |||||
EARNINGS (LOSS) PER COMMON SHARE: | ||||||||||||
Basic | $ | $ | ( | ) | $ | ( | ) | |||||
Diluted | $ | $ | ( | ) | $ | ( | ) | |||||
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions): | ||||||||||||
Basic | ||||||||||||
Diluted | ||||||||||||
Nine Months Ended September 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 | $ | $ | $ | |||||||||
Marketing | ||||||||||||
Total Revenues | ||||||||||||
Other | ||||||||||||
Gains on sales of assets | ||||||||||||
Total Revenues and Other | ||||||||||||
OPERATING EXPENSES: | ||||||||||||
Oil, natural gas and NGL production | ||||||||||||
Oil, natural gas and NGL gathering, processing and transportation | ||||||||||||
Production taxes | ||||||||||||
Exploration | ||||||||||||
Marketing | ||||||||||||
General and administrative | ||||||||||||
Restructuring and other termination costs | ||||||||||||
Provision for legal contingencies, net | ||||||||||||
Depreciation, depletion and amortization | ||||||||||||
Impairments | ||||||||||||
Other operating (income) expense | ( | ) | ( | ) | ||||||||
Total Operating Expenses | ||||||||||||
INCOME (LOSS) FROM OPERATIONS | ( | ) | ( | ) | ||||||||
OTHER INCOME (EXPENSE): | ||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | ||||||
Gains on investments | ||||||||||||
Losses on purchases or exchanges of debt | ( | ) | ( | ) | ||||||||
Other income | ( | ) | ||||||||||
Total Other Expense | ( | ) | ( | ) | ( | ) | ||||||
INCOME (LOSS) BEFORE INCOME TAXES | ( | ) | ( | ) | ||||||||
Income tax benefit | ( | ) | ( | ) | ||||||||
NET INCOME (LOSS) | ( | ) | ( | ) | ||||||||
Net income attributable to noncontrolling interests | ( | ) | ( | ) | ||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | ( | ) | ( | ) | ||||||||
Preferred stock dividends | ( | ) | ( | ) | ||||||||
Earnings allocated to participating securities | ( | ) | ||||||||||
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS | $ | $ | ( | ) | $ | ( | ) | |||||
EARNINGS (LOSS) PER COMMON SHARE: | ||||||||||||
Basic | $ | $ | ( | ) | $ | ( | ) | |||||
Diluted | $ | $ | ( | ) | $ | ( | ) | |||||
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions): | ||||||||||||
Basic | ||||||||||||
Diluted | ||||||||||||
Three Months Ended September 30, 2019 | ||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | Under Full Cost | Successful Efforts Adjustment | Under Successful Efforts | |||||||||
($ in millions) | ||||||||||||
NET INCOME (LOSS) | $ | $ | ( | ) | $ | ( | ) | |||||
OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX: | ||||||||||||
Unrealized gains on derivative instruments | ||||||||||||
Reclassification of losses on settled derivative instruments | ||||||||||||
Other Comprehensive Income | ||||||||||||
COMPREHENSIVE INCOME (LOSS) | ( | ) | ( | ) | ||||||||
COMPREHENSIVE LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS | ||||||||||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | $ | $ | ( | ) | $ | ( | ) | |||||
Three Months Ended September 30, 2018 | ||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | Under Full Cost | Successful Efforts Adjustment | Under Successful Efforts | |||||||||
($ in millions) | ||||||||||||
NET INCOME (LOSS) | $ | $ | ( | ) | $ | ( | ) | |||||
OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX: | ||||||||||||
Unrealized gains on derivative instruments | ||||||||||||
Reclassification of losses on settled derivative instruments | ||||||||||||
Other Comprehensive Income | ||||||||||||
COMPREHENSIVE INCOME (LOSS) | ( | ) | ( | ) | ||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS | ( | ) | ||||||||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | $ | $ | ( | ) | $ | ( | ) | |||||
Nine Months Ended September 30, 2019 | ||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | Under Full Cost | Successful Efforts Adjustment | Under Successful Efforts | |||||||||
($ in millions) | ||||||||||||
NET INCOME | $ | $ | ( | ) | $ | |||||||
OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX: | ||||||||||||
Unrealized gains on derivative instruments | ||||||||||||
Reclassification of losses on settled derivative instruments | ||||||||||||
Other Comprehensive Income | ||||||||||||
COMPREHENSIVE INCOME | ( | ) | ||||||||||
COMPREHENSIVE (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS | ( | ) | ||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO CHESAPEAKE | $ | $ | ( | ) | $ | |||||||
Nine Months Ended September 30, 2018 | ||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | Under Full Cost | Successful Efforts Adjustment | Under Successful Efforts | |||||||||
($ in millions) | ||||||||||||
NET INCOME (LOSS) | $ | $ | ( | ) | $ | ( | ) | |||||
OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX: | ||||||||||||
Unrealized gains on derivative instruments | ||||||||||||
Reclassification of losses on settled derivative instruments | ||||||||||||
Other Comprehensive Income | ||||||||||||
COMPREHENSIVE INCOME (LOSS) | ( | ) | ( | ) | ||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS | ( | ) | ( | ) | ||||||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | $ | $ | ( | ) | $ | ( | ) | |||||
Nine Months Ended September 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 | $ | $ | ( | ) | $ | |||||||
ADJUSTMENTS TO RECONCILE NET INCOME TO CASH PROVIDED BY OPERATING ACTIVITIES: | ||||||||||||
Depreciation, depletion and amortization | ||||||||||||
Deferred income tax benefit | ( | ) | ( | ) | ||||||||
Derivative losses, net | ( | ) | ( | ) | ||||||||
Cash receipts on derivative settlements, net | ||||||||||||
Stock-based compensation | ||||||||||||
Gains on sales of assets | ( | ) | ( | ) | ||||||||
Impairments | ||||||||||||
Exploration | ||||||||||||
Losses on investments | ||||||||||||
Gains on purchases of debt | ( | ) | ( | ) | ||||||||
Other | ||||||||||||
Changes in assets and liabilities | ( | ) | ( | ) | ( | ) | ||||||
Net Cash Provided By Operating Activities | ( | ) | ||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||
Drilling and completion costs | ( | ) | ( | ) | ||||||||
Business combination, net | ( | ) | ( | ) | ||||||||
Acquisitions of proved and unproved properties | ( | ) | ( | ) | ||||||||
Proceeds from divestitures of proved and unproved properties | ||||||||||||
Additions to other property and equipment | ( | ) | ( | ) | ||||||||
Proceeds from sales of other property and equipment | ||||||||||||
Net Cash Used In Investing Activities | ( | ) | ( | ) | ||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||
Proceeds from revolving credit facility borrowings | ||||||||||||
Payments on revolving credit facility borrowings | ( | ) | ( | ) | ||||||||
Cash paid to purchase debt | ( | ) | ( | ) | ||||||||
Cash paid for preferred stock dividends | ( | ) | ( | ) | ||||||||
Distributions to noncontrolling interest owners | ( | ) | ( | ) | ||||||||
Other | ( | ) | ( | ) | ||||||||
Net Cash Provided By Financing Activities | ||||||||||||
Net increase in cash and cash equivalents | ||||||||||||
Cash and cash equivalents, beginning of period | ||||||||||||
Cash and cash equivalents, end of period | $ | $ | $ | |||||||||
Nine Months Ended September 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) | $ | $ | ( | ) | $ | ( | ) | |||||
ADJUSTMENTS TO RECONCILE NET INCOME (LOSS) TO CASH PROVIDED BY OPERATING ACTIVITIES: | ||||||||||||
Depreciation, depletion and amortization | ||||||||||||
Deferred income tax benefit | ( | ) | ( | ) | ||||||||
Derivative losses, net | ||||||||||||
Cash payments on derivative settlements, net | ( | ) | ( | ) | ||||||||
Stock-based compensation | ||||||||||||
Gains on sales of assets | ( | ) | ( | ) | ||||||||
Impairments | ||||||||||||
Exploration | ||||||||||||
Gains on investments | ( | ) | ( | ) | ||||||||
Losses on purchases or exchanges of debt | ||||||||||||
Other | ( | ) | ( | ) | ( | ) | ||||||
Changes in assets and liabilities | ( | ) | ||||||||||
Net Cash Provided By Operating Activities | ( | ) | ||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||
Drilling and completion costs | ( | ) | ( | ) | ||||||||
Acquisitions of proved and unproved properties | ( | ) | ( | ) | ||||||||
Proceeds from divestitures of proved and unproved properties | ||||||||||||
Additions to other property and equipment | ( | ) | ( | ) | ||||||||
Proceeds from sales of other property and equipment | ||||||||||||
Proceeds from sales of investments | ||||||||||||
Net Cash Used In Investing Activities | ( | ) | ( | ) | ||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||
Proceeds from revolving credit facility borrowings | ||||||||||||
Payments on revolving credit facility borrowings | ( | ) | ( | ) | ||||||||
Proceeds from issuance of senior notes, net | ||||||||||||
Cash paid to purchase debt | ( | ) | ( | ) | ||||||||
Extinguishment of other financing | ( | ) | ( | ) | ||||||||
Cash paid for preferred stock dividends | ( | ) | ( | ) | ||||||||
Distributions to noncontrolling interest owners | ( | ) | ( | ) | ||||||||
Other | ( | ) | ( | ) | ||||||||
Net Cash Used In Financing Activities | ( | ) | ( | ) | ||||||||
Net decrease in cash and cash equivalents | ( | ) | ( | ) | ||||||||
Cash and cash equivalents, beginning of period | ||||||||||||
Cash and cash equivalents, end of period | $ | $ | $ | |||||||||
Three Months Ended September 30, 2019 | ||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY | Under Full Cost | Successful Efforts Adjustment | Under Successful Efforts | |||||||||
($ in millions) | ||||||||||||
PREFERRED STOCK: | ||||||||||||
Balance, beginning of period | $ | $ | $ | |||||||||
Exchange of 40,000 shares of preferred stock for common stock | ( | ) | ( | ) | ||||||||
Balance, end of period | ||||||||||||
COMMON STOCK: | ||||||||||||
Balance, beginning of period | ||||||||||||
Exchange of senior notes and convertible senior notes | ||||||||||||
Exchange of preferred stock | ||||||||||||
Balance, end of period | ||||||||||||
ADDITIONAL PAID-IN CAPITAL: | ||||||||||||
Balance, beginning of period | ||||||||||||
Exchange of preferred stock for 10,367,950 shares of common stock | ||||||||||||
Exchange of senior notes for 235,563,519 shares of common stock | ||||||||||||
Exchange of convertible senior notes for 73,389,094 shares of common stock | ||||||||||||
Equity component of convertible notes repurchases | ( | ) | ( | ) | ||||||||
Stock-based compensation | ||||||||||||
Dividends on preferred stock | ( | ) | ( | ) | ||||||||
Balance, end of period | ||||||||||||
ACCUMULATED DEFICIT: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Net income (loss) attributable to Chesapeake | ( | ) | ( | ) | ||||||||
Balance, end of period | ( | ) | ( | ) | ||||||||
ACCUMULATED OTHER COMPREHENSIVE LOSS: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Hedging activity | ||||||||||||
Balance, end of period | ||||||||||||
TREASURY STOCK – COMMON: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Purchase of 53,337 shares for company benefit plans | ||||||||||||
Release of 37,301 shares from company benefit plans | ||||||||||||
Balance, end of period | ( | ) | ( | ) | ||||||||
TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY | ||||||||||||
NONCONTROLLING INTERESTS: | ||||||||||||
Balance, beginning of period | ( | ) | ||||||||||
Net loss attributable to noncontrolling interests | ||||||||||||
Distributions to noncontrolling interest owners | ||||||||||||
Balance, end of period | ( | ) | ||||||||||
TOTAL EQUITY | $ | $ | $ | |||||||||
Three Months Ended September 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 | $ | $ | $ | |||||||||
COMMON STOCK: | ||||||||||||
Balance, beginning of period | ||||||||||||
ADDITIONAL PAID-IN CAPITAL: | ||||||||||||
Balance, beginning of period | ||||||||||||
Stock-based compensation | ||||||||||||
Dividends on preferred stock | ( | ) | ( | ) | ||||||||
Balance, end of period | ||||||||||||
ACCUMULATED DEFICIT: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Net income (loss) attributable to Chesapeake | ( | ) | ( | ) | ||||||||
Balance, end of period | ( | ) | ( | ) | ||||||||
ACCUMULATED OTHER COMPREHENSIVE LOSS: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Hedging activity | ||||||||||||
Balance, end of period | ( | ) | ( | ) | ||||||||
TREASURY STOCK – COMMON: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Purchase of 30,509 shares for company benefit plans | ||||||||||||
Release of 41,617 shares from company benefit plans | ||||||||||||
Balance, end of period | ( | ) | ( | ) | ||||||||
TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY (DEFICIT) | ( | ) | ||||||||||
NONCONTROLLING INTERESTS: | ||||||||||||
Balance, beginning of period | ( | ) | ||||||||||
Net income attributable to noncontrolling interests | ( | ) | ||||||||||
Distributions to noncontrolling interest owners | ( | ) | ( | ) | ||||||||
Balance, end of period | ( | ) | ||||||||||
TOTAL EQUITY (DEFICIT) | $ | ( | ) | $ | $ | |||||||
Nine Months Ended September 30, 2019 | ||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY | Under Full Cost | Successful Efforts Adjustment | Under Successful Efforts | |||||||||
($ in millions) | ||||||||||||
PREFERRED STOCK: | ||||||||||||
Balance, beginning of period | $ | $ | $ | |||||||||
Exchange of 40,000 shares of preferred stock for common stock | ( | ) | ( | ) | ||||||||
Balance, end of period | ||||||||||||
COMMON STOCK: | ||||||||||||
Balance, beginning of period | ||||||||||||
Common shares issued for WildHorse Merger | ||||||||||||
Exchange of senior notes and convertible senior notes | ||||||||||||
Exchange of preferred stock | ||||||||||||
Balance, end of period | ||||||||||||
ADDITIONAL PAID-IN CAPITAL: | ||||||||||||
Balance, beginning of period | ||||||||||||
Common shares issued for WildHorse Merger | ||||||||||||
Exchange of preferred stock for 10,367,950 shares of common stock | ||||||||||||
Exchange of senior notes for 235,563,519 shares of common stock | ||||||||||||
Exchange of convertible senior notes for 73,389,094 shares of common stock | ||||||||||||
Equity component of convertible notes repurchases | ( | ) | ( | ) | ||||||||
Stock-based compensation | ||||||||||||
Dividends on preferred stock | ( | ) | ( | ) | ||||||||
Balance, end of period | ||||||||||||
ACCUMULATED DEFICIT: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Net income attributable to Chesapeake | ( | ) | ||||||||||
Balance, end of period | ( | ) | ( | ) | ||||||||
ACCUMULATED OTHER COMPREHENSIVE LOSS: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Hedging activity | ||||||||||||
Balance, end of period | ||||||||||||
TREASURY STOCK – COMMON: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Purchase of 2,673,903 shares for company benefit plans | ( | ) | ( | ) | ||||||||
Release of 296,864 shares from company benefit plans | ||||||||||||
Balance, end of period | ( | ) | ( | ) | ||||||||
TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY | ||||||||||||
NONCONTROLLING INTERESTS: | ||||||||||||
Balance, beginning of period | ( | ) | ||||||||||
Net income (loss) attributable to noncontrolling interests | ( | ) | ||||||||||
Distributions to noncontrolling interest owners | ( | ) | ( | ) | ||||||||
Balance, end of period | ( | ) | ||||||||||
TOTAL EQUITY | $ | $ | $ | |||||||||
Nine Months Ended September 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 | $ | $ | $ | |||||||||
COMMON STOCK: | ||||||||||||
Balance, beginning and end of period | ||||||||||||
ADDITIONAL PAID-IN CAPITAL: | ||||||||||||
Balance, beginning of period | ||||||||||||
Stock-based compensation | ||||||||||||
Dividends on preferred stock | ( | ) | ( | ) | ||||||||
Balance, end of period | ||||||||||||
ACCUMULATED DEFICIT: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Net income (loss) attributable to Chesapeake | ( | ) | ( | ) | ||||||||
Cumulative effect of accounting change | ( | ) | ( | ) | ||||||||
Balance, end of period | ( | ) | ( | ) | ||||||||
ACCUMULATED OTHER COMPREHENSIVE LOSS: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Hedging activity | ||||||||||||
Balance, end of period | ( | ) | ( | ) | ||||||||
TREASURY STOCK – COMMON: | ||||||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||||||
Purchase of 1,499,033 shares for company benefit plans | ( | ) | ( | ) | ||||||||
Release of 431,474 shares from company benefit plans | ||||||||||||
Balance, end of period | ( | ) | ( | ) | ||||||||
TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY (DEFICIT) | ( | ) | ||||||||||
NONCONTROLLING INTERESTS: | ||||||||||||
Balance, beginning of period | ( | ) | ||||||||||
Net income attributable to noncontrolling interests | ( | ) | ||||||||||
Distributions to noncontrolling interest owners | ( | ) | ( | ) | ||||||||
Balance, end of period | ( | ) | ||||||||||
TOTAL EQUITY (DEFICIT) | $ | ( | ) | $ | $ | |||||||
3. | Oil and Natural Gas Property Transactions |
Preliminary Purchase Price Allocation | |||
($ in millions) | |||
Consideration: | |||
Cash | $ | ||
Fair value of Chesapeake’s common stock issued in the Merger (a) | |||
Total consideration | $ | ||
Fair Value of Liabilities Assumed: | |||
Current liabilities | $ | ||
Long-term debt | |||
Deferred tax liabilities | |||
Other long-term liabilities | |||
Amounts attributable to liabilities assumed | $ | ||
Fair Value of Assets Acquired: | |||
Cash and cash equivalents | $ | ||
Other current assets | |||
Proved oil and natural gas properties | |||
Unproved properties | |||
Other property and equipment | |||
Other long-term assets | |||
Amounts attributable to assets acquired | $ | ||
Total identifiable net assets | $ | ||
(a) | Based on |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||
2018 | 2019 | 2018 | ||||||||||
($ in millions except per share data) | ||||||||||||
Revenues | $ | $ | $ | |||||||||
Net income (loss) available to common stockholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
Earnings per common share: | ||||||||||||
Basic | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
Diluted | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
4. | Capitalized Exploratory Well Costs |
2019 | ||||
($ in millions) | ||||
Balance as of January 1 | $ | |||
Additions pending the determination of proved reserves | ||||
Divestitures and other | ||||
Reclassifications to proved properties | ( | ) | ||
Charges to exploration expense | ( | ) | ||
Balance as of September 30 | $ | |||
5. | Earnings Per Share |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||
(in millions) | |||||||||||
Common stock equivalent of our preferred stock outstanding | |||||||||||
Common stock equivalent of our convertible senior notes outstanding | |||||||||||
Common stock equivalent of our preferred stock outstanding prior to exchange | |||||||||||
Participating securities | |||||||||||
6. | Debt |
September 30, 2019 | December 31, 2018 | ||||||||||||||
Principal Amount | Carrying Amount | Principal Amount | Carrying Amount | ||||||||||||
($ in millions) | |||||||||||||||
Floating rate senior notes due 2019 | |||||||||||||||
6.625% senior notes due 2020 | |||||||||||||||
6.875% senior notes due 2020 | |||||||||||||||
6.125% senior notes due 2021 | |||||||||||||||
5.375% senior notes due 2021 | |||||||||||||||
4.875% senior notes due 2022 | |||||||||||||||
5.75% senior notes due 2023 | |||||||||||||||
7.00% senior notes due 2024 | |||||||||||||||
6.875% senior notes due 2025(a) | |||||||||||||||
8.00% senior notes due 2025 | |||||||||||||||
5.5% convertible senior notes due 2026(b) | |||||||||||||||
7.5% senior notes due 2026 | |||||||||||||||
8.00% senior notes due 2026 | |||||||||||||||
8.00% senior notes due 2027 | |||||||||||||||
2.25% contingent convertible senior notes due 2038 | |||||||||||||||
Chesapeake revolving credit facility | |||||||||||||||
BVL revolving credit facility(a) | |||||||||||||||
Debt issuance costs | — | ( | ) | — | ( | ) | |||||||||
Interest rate derivatives | |||||||||||||||
Total debt, net | |||||||||||||||
Less current maturities of long-term debt, net(c) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Total long-term debt, net | $ | $ | $ | $ | |||||||||||
(a) | On February 1, 2019, we acquired the debt of WildHorse which consisted of |
(b) | We are required to account for the liability and equity components of our convertible debt instrument separately and to reflect interest expense through the first demand repurchase date, as applicable, at the interest rate of similar nonconvertible debt at the time of issuance. The applicable rate for our |
(c) | As of September 30, 2019, net current maturities of long-term debt includes our |
Notes Exchanged | ||||
($ in millions) | ||||
6.625% senior notes due 2020 | $ | |||
6.875% senior notes due 2020 | ||||
6.125% senior notes due 2021 | ||||
5.375% senior notes due 2021 | ||||
Total | $ | |||
September 30, 2019 | December 31, 2018 | |||||||||||||||
Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | |||||||||||||
($ in millions) | ||||||||||||||||
Short-term debt (Level 1) | $ | $ | $ | $ | ||||||||||||
Long-term debt (Level 1) | $ | $ | $ | $ | ||||||||||||
Long-term debt (Level 2) | $ | $ | $ | $ | ||||||||||||
7. | Contingencies and Commitments |
September 30, 2019 | ||||
($ in millions) | ||||
Remainder of 2019 | $ | |||
2020 | ||||
2021 | ||||
2022 | ||||
2023 | ||||
2024 – 2035 | ||||
Total | $ | |||
8. | Other Liabilities |
September 30, 2019 | December 31, 2018 | |||||||
($ in millions) | ||||||||
Revenues and royalties due others | $ | $ | ||||||
Accrued drilling and production costs | ||||||||
Joint interest prepayments received | ||||||||
VPP deferred revenue(a) | ||||||||
Accrued compensation and benefits | ||||||||
Other accrued taxes | ||||||||
Other | ||||||||
Total other current liabilities | $ | $ | ||||||
September 30, 2019 | December 31, 2018 | |||||||
($ in millions) | ||||||||
VPP deferred revenue(a) | $ | $ | ||||||
Unrecognized tax benefits | ||||||||
Other | ||||||||
Total other long-term liabilities | $ | $ | ||||||
(a) | At the inception of our volumetric production payment (VPP) agreements, we (i) removed the proved reserves associated with the VPP, (ii) recognized VPP proceeds as deferred revenue which are being amortized on a unit-of-production basis to other revenue over the term of the VPP, (iii) retained responsibility for the production costs and capital costs related to VPP interests and (iv) ceased recognizing production associated with the VPP volumes. The remaining deferred revenue balance will be recognized in other revenues in the consolidated statement of operations through 2021, assuming the related VPP production volumes are delivered as scheduled. |
9. | Leases |
Financing | Operating | |||||||
($ in millions) | ||||||||
ROU assets | $ | $ | ||||||
Lease liabilities: | ||||||||
Current lease liabilities | $ | $ | ||||||
Long-term lease liabilities | ||||||||
Total lease liabilities | $ | $ | ||||||
Three Months Ended September 30, 2019 | Nine Months Ended September 30, 2019 | |||||||
Lease cost: | ($ in millions) | |||||||
Amortization of ROU assets | $ | $ | ||||||
Interest on lease liability | ||||||||
Finance lease cost | ||||||||
Operating lease cost | ||||||||
Short-term lease cost | ||||||||
Total lease cost(a) | $ | $ | ||||||
Other information: | ||||||||
Operating cash outflows from finance lease | $ | $ | ||||||
Operating cash outflows from operating leases | $ | $ | ||||||
Investing cash outflows from operating leases | $ | $ | ||||||
Financing cash outflows from finance lease | $ | $ | ||||||
Weighted-average remaining lease term - finance lease | ||||||||
Weighted-average remaining lease term - operating leases | ||||||||
Weighted-average discount rate - finance lease | % | |||||||
Weighted-average discount rate - operating leases | % | |||||||
(a) | Includes $ |
September 30, 2019 | ||||||||
Financing Lease | Operating Leases | |||||||
($ in millions) | ||||||||
Remainder of 2019 | $ | $ | ||||||
2020 | ||||||||
2021 | ||||||||
2022 | ||||||||
2023 | ||||||||
Thereafter | ||||||||
Total lease payments | ||||||||
Less imputed interest | ( | ) | ( | ) | ||||
Present value of lease liabilities | ||||||||
Less current maturities | ( | ) | ( | ) | ||||
Present value of lease liabilities, less current maturities | $ | $ | ||||||
December 31, 2018 | ||||||||
Capital Lease | Operating Leases | |||||||
($ in millions) | ||||||||
2019 | $ | $ | ||||||
2020 | ||||||||
2021 | ||||||||
Total minimum lease payments | $ | $ | ||||||
10. | Revenue Recognition |
Three Months Ended September 30, 2019 | ||||||||||||||||
Oil | Natural Gas | NGL | Total | |||||||||||||
($ in millions) | ||||||||||||||||
Marcellus | $ | $ | $ | $ | ||||||||||||
Haynesville | ||||||||||||||||
Eagle Ford | ||||||||||||||||
Brazos Valley | ||||||||||||||||
Powder River Basin | ||||||||||||||||
Mid-Continent | ||||||||||||||||
Revenue from contracts with customers | ||||||||||||||||
Gains on oil, natural gas and NGL derivatives | ||||||||||||||||
Oil, natural gas and NGL revenue | $ | $ | $ | $ | ||||||||||||
Marketing revenue from contracts with customers | $ | $ | $ | $ | ||||||||||||
Other marketing revenue | ||||||||||||||||
Losses on oil, natural gas and NGL derivatives | ||||||||||||||||
Marketing revenue | $ | $ | $ | $ | ||||||||||||
Three Months Ended September 30, 2018 | ||||||||||||||||
Oil | Natural Gas | NGL | Total | |||||||||||||
($ in millions) | ||||||||||||||||
Marcellus | $ | $ | $ | $ | ||||||||||||
Haynesville | ||||||||||||||||
Eagle Ford | ||||||||||||||||
Powder River Basin | ||||||||||||||||
Mid-Continent | ||||||||||||||||
Utica | ||||||||||||||||
Revenue from contracts with customers | ||||||||||||||||
Losses on oil, natural gas and NGL derivatives | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Oil, natural gas and NGL revenue | $ | $ | $ | $ | ||||||||||||
Marketing revenue from contracts with customers | ||||||||||||||||
Other marketing revenue | ||||||||||||||||
Marketing revenue | $ | $ | $ | $ | ||||||||||||
Nine Months Ended September 30, 2019 | ||||||||||||||||
Oil | Natural Gas | NGL | Total | |||||||||||||
($ in millions) | ||||||||||||||||
Marcellus | $ | $ | $ | $ | ||||||||||||
Haynesville | ||||||||||||||||
Eagle Ford | ||||||||||||||||
Brazos Valley | ||||||||||||||||
Powder River Basin | ||||||||||||||||
Mid-Continent | ||||||||||||||||
Revenue from contracts with customers | ||||||||||||||||
Gains (losses) on oil, natural gas and NGL derivatives | ( | ) | ||||||||||||||
Oil, natural gas and NGL revenue | $ | $ | $ | $ | ||||||||||||
Marketing revenue from contracts with customers | $ | $ | $ | $ | ||||||||||||
Other marketing revenue | ||||||||||||||||
Losses on oil, natural gas and NGL derivatives | ( | ) | ( | ) | ||||||||||||
Marketing revenue | $ | $ | $ | $ | ||||||||||||
Nine Months Ended September 30, 2018 | ||||||||||||||||
Oil | Natural Gas | NGL | Total | |||||||||||||
($ in millions) | ||||||||||||||||
Marcellus | $ | $ | $ | $ | ||||||||||||
Haynesville | ||||||||||||||||
Eagle Ford | ||||||||||||||||
Powder River Basin | ||||||||||||||||
Mid-Continent | ||||||||||||||||
Utica | ||||||||||||||||
Revenue from contracts with customers | ||||||||||||||||
Losses on oil, natural gas and NGL derivatives | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Oil, natural gas and NGL revenue | $ | $ | $ | $ | ||||||||||||
Marketing revenue from contracts with customers | ||||||||||||||||
Other marketing revenue | ||||||||||||||||
Marketing revenue | $ | $ | $ | $ | ||||||||||||
September 30, 2019 | December 31, 2018 | |||||||
($ in millions) | ||||||||
Oil, natural gas and NGL sales | $ | $ | ||||||
Joint interest | ||||||||
Other | ||||||||
Allowance for doubtful accounts | ( | ) | ( | ) | ||||
Total accounts receivable, net | $ | $ | ||||||
11. | Income Taxes |
12. | Equity |
Three Months Ended September 30, | Nine Months Ended, September 30, | |||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||
(in thousands) | ||||||||||||
Beginning balance | ||||||||||||
Common shares issued for WildHorse Merger(a) | ||||||||||||
Exchange of convertible notes(b) | ||||||||||||
Exchange of senior notes(b) | ||||||||||||
Exchange of preferred stock(c) | ||||||||||||
Restricted stock issuances (net of forfeitures and cancellations)(d) | ||||||||||||
Ending balance | ||||||||||||
(a) |
(b) |
(c) | In the Current Quarter, we exchanged |
(d) |
5.75% | 5.75% (A) | 4.50% | 5.00% (2005B) | |||||||||||||
(in thousands) | ||||||||||||||||
Shares outstanding as of July 1, 2019 | ||||||||||||||||
Exchange of preferred stock(a) | ( | ) | ||||||||||||||
Shares outstanding as of September 30, 2019 | ||||||||||||||||
Shares outstanding as of July 1, 2018 and September 30, 2018 | ||||||||||||||||
Shares outstanding as of January 1, 2019 | ||||||||||||||||
Exchange of preferred stock(a) | ( | ) | ||||||||||||||
Shares outstanding as of September 30, 2019 | ||||||||||||||||
Shares outstanding as of January 1, 2018 and September 30, 2018 | ||||||||||||||||
Liquidation price per share | $ | $ | $ | $ | ||||||||||||
(a) | See discussion above regarding the exchange of our |
13. | Share-Based Compensation |
Shares of Unvested Restricted Stock | Weighted Average Grant Date Fair Value Per Share | ||||||
(in thousands) | |||||||
Unvested restricted stock as of January 1, 2019 | $ | ||||||
Granted | $ | ||||||
Vested | ( | ) | $ | ||||
Forfeited | ( | ) | $ | ||||
Unvested restricted stock as of September 30, 2019 | $ | ||||||
Expected option life – years | |||
Volatility | % | ||
Risk-free interest rate | % | ||
Dividend yield | % | ||
Number of Shares Underlying Options | Weighted Average Exercise Price Per Share | Weighted Average Contract Life in Years | Aggregate Intrinsic Value(a) | ||||||||||
(in thousands) | ($ in millions) | ||||||||||||
Outstanding as of January 1, 2019 | $ | $ | |||||||||||
Granted | $ | ||||||||||||
Exercised | $ | $ | |||||||||||
Expired | ( | ) | $ | ||||||||||
Forfeited | ( | ) | $ | ||||||||||
Outstanding as of September 30, 2019 | $ | $ | |||||||||||
Exercisable as of September 30, 2019 | $ | $ | |||||||||||
(a) | The intrinsic value of a stock option is the amount by which the current market value or the market value upon exercise of the underlying stock exceeds the exercise price of the option. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
($ in millions) | |||||||||||||||
General and administrative expenses | $ | $ | $ | $ | |||||||||||
Oil and natural gas properties | |||||||||||||||
Oil, natural gas and NGL production expenses | |||||||||||||||
Exploration expenses | |||||||||||||||
Total restricted stock and stock option compensation | $ | $ | $ | $ | |||||||||||
Grant Date Assumptions | |||
Assumption | 2017 Awards | ||
Volatility | % | ||
Risk-free interest rate | % | ||
Dividend yield for value of awards | % | ||
Reporting Period Assumptions | |||
Assumption | 2017 Awards | ||
Volatility | % | ||
Risk-free interest rate | % | ||
Dividend yield for value of awards | % | ||
Grant Date Fair Value | September 30, 2019 | ||||||||||||||
Units | Fair Value | Vested Liability | |||||||||||||
($ in millions) | ($ in millions) | ||||||||||||||
2019 PSU Awards: | |||||||||||||||
Payable 2020, 2021 and 2022 | $ | $ | $ | ||||||||||||
2018 PSU Awards: | |||||||||||||||
Payable 2020 and 2021 | $ | $ | $ | ||||||||||||
2017 PSU Awards: | |||||||||||||||
Payable 2020 | $ | $ | $ | ||||||||||||
2018 CRSU Awards: | |||||||||||||||
Payable 2020 and 2021 | $ | $ | $ | ||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
($ in millions) | ||||||||||||||||
General and administrative expenses | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||
Oil and natural gas properties | ||||||||||||||||
Oil, natural gas and NGL production expenses | ||||||||||||||||
Exploration expenses | ||||||||||||||||
Total liability-classified awards compensation | $ | $ | $ | $ | ||||||||||||
14. | Derivative and Hedging Activities |
• | Swaps: We receive a fixed price and pay a floating market price to the counterparty for the hedged commodity. In exchange for higher fixed prices on certain of our swap trades, we may sell call options and call swaptions. |
• | Options: We occasionally sell and buy call and put options in exchange for a premium. At the time of settlement, if the market price exceeds the fixed price of the call option, we pay the counterparty the excess on sold call options and we receive the excess on bought call options. At the time of settlement, if the market price is lower than the fixed price of the put option, we receive the difference on bought put options and pay the counterparty the difference on sold put options. If the market price settles below the fixed price of the call option or above the fixed price of the put option, no payment is due from either party. |
• | Call Swaptions: We sell call swaptions to counterparties in exchange for a premium that allow the counterparty, on a specific date, to extend an existing fixed-price swap for a certain period of time or to increase the notional volumes of an existing fixed-price swap. |
• | Collars: These instruments contain a fixed floor price (put) and ceiling price (call). If the market price exceeds the call strike price or falls below the put strike price, we receive the fixed price and pay the market price. If the market price is between the put and the call strike prices, no payments are due from either party. Three-way collars include the sale by us of an additional put option in exchange for a more favorable strike price on the call option. This eliminates the counterparty’s downside exposure below the second put option strike price. |
• | Basis Protection Swaps: These instruments are arrangements that guarantee a fixed price differential to NYMEX from a specified delivery point. We receive the fixed price differential and pay the floating market price differential to the counterparty for the hedged commodity. |
September 30, 2019 | December 31, 2018 | |||||||||||||
Notional Volume | Fair Value | Notional Volume | Fair Value | |||||||||||
($ in millions) | ($ in millions) | |||||||||||||
Oil (mmbbl): | ||||||||||||||
Fixed-price swaps | $ | $ | ||||||||||||
Collars | ||||||||||||||
Call swaptions | ( | ) | — | — | ||||||||||
Put options | ( | ) | — | — | ||||||||||
Basis protection swaps | ||||||||||||||
Total oil | ||||||||||||||
Natural gas (bcf): | ||||||||||||||
Fixed-price swaps | ||||||||||||||
Three-way collars | ||||||||||||||
Collars | ( | ) | ||||||||||||
Call options | ||||||||||||||
Call swaptions | ( | ) | ( | ) | ||||||||||
Basis protection swaps | ( | ) | ||||||||||||
Total natural gas | ||||||||||||||
Contingent consideration: | ||||||||||||||
Utica divestiture | ||||||||||||||
Total estimated fair value | $ | $ | ||||||||||||
Balance Sheet Classification | Gross Fair Value | Amounts Netted in the Consolidated Balance Sheets | Net Fair Value Presented in the Consolidated Balance Sheet | |||||||||
($ in millions) | ||||||||||||
As of September 30, 2019 | ||||||||||||
Commodity Contracts: | ||||||||||||
Short-term derivative asset | $ | $ | ( | ) | $ | |||||||
Long-term derivative asset | ( | ) | ||||||||||
Short-term derivative liability | ( | ) | ||||||||||
Long-term derivative liability | ( | ) | ||||||||||
Contingent Consideration: | ||||||||||||
Short-term derivative asset | ||||||||||||
Total derivatives | $ | $ | $ | |||||||||
As of December 31, 2018 | ||||||||||||
Commodity Contracts: | ||||||||||||
Short-term derivative asset | $ | $ | ( | ) | $ | |||||||
Long-term derivative asset | ( | ) | ||||||||||
Short-term derivative liability | ( | ) | ( | ) | ||||||||
Long-term derivative liability | ( | ) | ||||||||||
Contingent Consideration: | ||||||||||||
Short-term derivative asset | ||||||||||||
Total derivatives | $ | $ | $ | |||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
($ in millions) | ||||||||||||||||
Oil, natural gas and NGL revenues | $ | $ | $ | $ | ||||||||||||
Gains (losses) on undesignated oil, natural gas and NGL derivatives | ( | ) | ( | ) | ||||||||||||
Losses on terminated cash flow hedges | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Total oil, natural gas and NGL revenues | $ | $ | $ | $ | ||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
($ in millions) | ||||||||||||||||
Marketing revenues | $ | $ | $ | $ | ||||||||||||
Losses on undesignated marketing natural gas derivatives | ( | ) | ||||||||||||||
Total marketing revenues | $ | $ | $ | $ | ||||||||||||
Three Months Ended September 30, | ||||||||||||||||
2019 | 2018 | |||||||||||||||
Before Tax | After Tax | Before Tax | After Tax | |||||||||||||
($ in millions) | ||||||||||||||||
Balance, beginning of period | $ | ( | ) | $ | ( | ) | $ | ( | ) | ( | ) | |||||
Losses reclassified to income | ||||||||||||||||
Balance, end of period | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | ||||||
Nine Months Ended September 30, | ||||||||||||||||
2019 | 2018 | |||||||||||||||
Before Tax | After Tax | Before Tax | After Tax | |||||||||||||
($ in millions) | ||||||||||||||||
Balance, beginning of period | $ | ( | ) | $ | ( | ) | $ | ( | ) | ( | ) | |||||
Losses reclassified to income | ||||||||||||||||
Balance, end of period | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | ||||||
Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total Fair Value | |||||||||||||
($ in millions) | ||||||||||||||||
As of September 30, 2019 | ||||||||||||||||
Derivative Assets (Liabilities): | ||||||||||||||||
Commodity assets | $ | $ | $ | $ | ||||||||||||
Commodity liabilities | ( | ) | ( | ) | ( | ) | ||||||||||
Utica divestiture contingent consideration | ||||||||||||||||
Total derivatives | $ | $ | $ | $ | ||||||||||||
As of December 31, 2018 | ||||||||||||||||
Derivative Assets (Liabilities): | ||||||||||||||||
Commodity assets | $ | $ | $ | $ | ||||||||||||
Commodity liabilities | ( | ) | ( | ) | ( | ) | ||||||||||
Utica divestiture contingent consideration | ||||||||||||||||
Total derivatives | $ | $ | $ | $ | ||||||||||||
Commodity Derivatives | Utica Contingent Consideration | |||||||
($ in millions) | ||||||||
Balance, as of January 1, 2019 | $ | $ | ||||||
Total gains (losses) (realized/unrealized): | ||||||||
Included in earnings(a) | ( | ) | ( | ) | ||||
Total purchases, issuances, sales and settlements: | ||||||||
Settlements | ( | ) | ||||||
Balance, as of September 30, 2019 | $ | $ | ||||||
Balance, as of January 1, 2018 | $ | ( | ) | $ | ||||
Total gains (losses) (realized/unrealized): | ||||||||
Included in earnings(a) | ( | ) | ||||||
Total purchases, issuances, sales and settlements: | ||||||||
Settlements | ||||||||
Balance, as of September 30, 2018 | $ | ( | ) | $ | ||||
(a) | Commodity Derivatives | Utica Contingent Consideration | |||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||
($ in millions) | |||||||||||||||||
Total gains (losses) included in earnings for the period | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | |||||||
Change in unrealized gains (losses) related to assets still held at reporting date | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | |||||||
Instrument Type | Unobservable Input | Range | Weighted Average | Fair Value September 30, 2019 | ||||||
($ in millions) | ||||||||||
Oil trades | Oil price volatility curves | 24.62% – 48.77% | $ | |||||||
Natural gas trades | Natural gas price volatility curves | 13.37% – 145.37% | $ | ( | ) | |||||
15. | Investments |
16. | Other Operating Expenses |
17. | Restructuring and Other Termination Costs |
18. | Fair Value Measurements |
Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total Fair Value | |||||||||||||
($ in millions) | ||||||||||||||||
As of September 30, 2019 | ||||||||||||||||
Financial Assets (Liabilities): | ||||||||||||||||
Other current assets | $ | $ | $ | $ | ||||||||||||
Other current liabilities | ( | ) | ( | ) | ||||||||||||
Total | $ | $ | $ | $ | ||||||||||||
As of December 31, 2018 | ||||||||||||||||
Financial Assets (Liabilities): | ||||||||||||||||
Other current assets | $ | $ | $ | $ | ||||||||||||
Other current liabilities | ( | ) | ( | ) | ||||||||||||
Total | $ | ( | ) | $ | $ | $ | ( | ) | ||||||||
19. | Condensed Consolidating Financial Information |
Parent | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
CURRENT ASSETS: | ||||||||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
Other current assets | ||||||||||||||||||||
Intercompany receivable, net | ( | ) | ||||||||||||||||||
Total Current Assets | ( | ) | ||||||||||||||||||
PROPERTY AND EQUIPMENT: | ||||||||||||||||||||
Oil and natural gas properties, at cost based on successful efforts accounting, net | ||||||||||||||||||||
Other property and equipment, net | ||||||||||||||||||||
Property and equipment held for sale, net | ||||||||||||||||||||
Total Property and Equipment, Net | ||||||||||||||||||||
LONG-TERM ASSETS: | ||||||||||||||||||||
Other long-term assets | ( | ) | ||||||||||||||||||
Investments in subsidiaries and intercompany advances | ( | ) | ||||||||||||||||||
TOTAL ASSETS | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
CURRENT LIABILITIES: | ||||||||||||||||||||
Current liabilities | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
Intercompany payable, net | ( | ) | ||||||||||||||||||
Total Current Liabilities | ( | ) | ||||||||||||||||||
LONG-TERM LIABILITIES: | ||||||||||||||||||||
Long-term debt, net | ||||||||||||||||||||
Deferred income tax liabilities | ( | ) | ||||||||||||||||||
Other long-term liabilities | ||||||||||||||||||||
Total Long-Term Liabilities | ( | ) | ||||||||||||||||||
EQUITY: | ||||||||||||||||||||
Chesapeake stockholders’ equity | ( | ) | ||||||||||||||||||
Noncontrolling interests | ||||||||||||||||||||
Total Equity | ( | ) | ||||||||||||||||||
TOTAL LIABILITIES AND EQUITY | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
Parent | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
CURRENT ASSETS: | ||||||||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
Other current assets | ||||||||||||||||||||
Intercompany receivable, net | ( | ) | ||||||||||||||||||
Total Current Assets | ( | ) | ||||||||||||||||||
PROPERTY AND EQUIPMENT: | ||||||||||||||||||||
Oil and natural gas properties, at cost based on successful efforts accounting, net | ||||||||||||||||||||
Other property and equipment, net | ||||||||||||||||||||
Property and equipment held for sale, net | ||||||||||||||||||||
Total Property and Equipment, Net | ||||||||||||||||||||
LONG-TERM ASSETS: | ||||||||||||||||||||
Other long-term assets | ||||||||||||||||||||
Investments in subsidiaries and intercompany advances | ( | ) | ||||||||||||||||||
TOTAL ASSETS | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
CURRENT LIABILITIES: | ||||||||||||||||||||
Current liabilities | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
Intercompany payable, net | ( | ) | ||||||||||||||||||
Total Current Liabilities | ( | ) | ||||||||||||||||||
LONG-TERM LIABILITIES: | ||||||||||||||||||||
Long-term debt, net | ||||||||||||||||||||
Other long-term liabilities | ||||||||||||||||||||
Total Long-Term Liabilities | ||||||||||||||||||||
EQUITY: | ||||||||||||||||||||
Chesapeake stockholders’ equity | ( | ) | ||||||||||||||||||
Noncontrolling interests | ||||||||||||||||||||
Total Equity | ( | ) | ||||||||||||||||||
TOTAL LIABILITIES AND EQUITY | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
Parent | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
REVENUES: | ||||||||||||||||||||
Oil, natural gas and NGL | $ | $ | $ | $ | $ | |||||||||||||||
Marketing | ||||||||||||||||||||
Total Revenues | ||||||||||||||||||||
Other | ||||||||||||||||||||
Gains on sales of assets | ||||||||||||||||||||
Total Revenues and Other | ||||||||||||||||||||
OPERATING EXPENSES: | ||||||||||||||||||||
Oil, natural gas and NGL production | ||||||||||||||||||||
Oil, natural gas and NGL gathering, processing and transportation | ||||||||||||||||||||
Production taxes | ||||||||||||||||||||
Exploration | ||||||||||||||||||||
Marketing | ||||||||||||||||||||
General and administrative | ||||||||||||||||||||
Depreciation, depletion and amortization | ||||||||||||||||||||
Impairments | ||||||||||||||||||||
Other operating expense | ||||||||||||||||||||
Total Operating Expenses | ||||||||||||||||||||
INCOME FROM OPERATIONS | ||||||||||||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||||||||
Interest income (expense) | ( | ) | ( | ) | ( | ) | ||||||||||||||
Losses on investments | ( | ) | ( | ) | ||||||||||||||||
Gains on purchases or exchanges of debt | ||||||||||||||||||||
Other income | ||||||||||||||||||||
Equity in net earnings of subsidiary | ( | ) | ||||||||||||||||||
Total Other Income (Expense) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
INCOME (LOSS) BEFORE INCOME TAXES | ( | ) | ( | ) | ( | ) | ||||||||||||||
INCOME TAX (BENEFIT) EXPENSE | ( | ) | ( | ) | ||||||||||||||||
NET INCOME (LOSS) | ( | ) | ( | ) | ( | ) | ||||||||||||||
Net loss attributable to noncontrolling interests | ||||||||||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | ( | ) | ( | ) | ( | ) | ||||||||||||||
Other comprehensive income | ||||||||||||||||||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||
Parent | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
REVENUES: | ||||||||||||||||||||
Oil, natural gas and NGL | $ | $ | $ | $ | $ | |||||||||||||||
Marketing | ||||||||||||||||||||
Total Revenues | ||||||||||||||||||||
Other | ||||||||||||||||||||
Losses on sales of assets | ( | ) | ( | ) | ||||||||||||||||
Total Revenues and Other | ||||||||||||||||||||
OPERATING EXPENSES: | ||||||||||||||||||||
Oil, natural gas and NGL production | ||||||||||||||||||||
Oil, natural gas and NGL gathering, processing and transportation | ||||||||||||||||||||
Production taxes | ||||||||||||||||||||
Exploration | ||||||||||||||||||||
Marketing | ||||||||||||||||||||
General and administrative | ||||||||||||||||||||
Provision for legal contingencies, net | ||||||||||||||||||||
Depreciation, depletion and amortization | ||||||||||||||||||||
Impairments | ||||||||||||||||||||
Total Operating Expenses | ||||||||||||||||||||
INCOME FROM OPERATIONS | ||||||||||||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | ||||||||||||||
Losses on purchases or exchanges of debt | ( | ) | ( | ) | ||||||||||||||||
Other income | ||||||||||||||||||||
Equity in net earnings of subsidiary | ( | ) | ||||||||||||||||||
Total Other Income (Expense) | ( | ) | ( | ) | ( | ) | ||||||||||||||
INCOME (LOSS) BEFORE INCOME TAXES | ( | ) | ( | ) | ( | ) | ||||||||||||||
INCOME TAX EXPENSE | ||||||||||||||||||||
NET INCOME (LOSS) | ( | ) | ( | ) | ( | ) | ||||||||||||||
Net (income) loss attributable to noncontrolling interests | ||||||||||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | ( | ) | ( | ) | ( | ) | ||||||||||||||
Other comprehensive income | ||||||||||||||||||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||
Parent | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
REVENUES: | ||||||||||||||||||||
Oil, natural gas and NGL | $ | $ | $ | $ | $ | |||||||||||||||
Marketing | ||||||||||||||||||||
Total Revenues | ||||||||||||||||||||
Other | ||||||||||||||||||||
Gains on sales of assets | ||||||||||||||||||||
Total Revenues and Other | ||||||||||||||||||||
OPERATING EXPENSES: | ||||||||||||||||||||
Oil, natural gas and NGL production | ||||||||||||||||||||
Oil, natural gas and NGL gathering, processing and transportation | ||||||||||||||||||||
Production taxes | ||||||||||||||||||||
Exploration | ||||||||||||||||||||
Marketing | ||||||||||||||||||||
General and administrative | ||||||||||||||||||||
Provision for legal contingencies, net | ||||||||||||||||||||
Depreciation, depletion and amortization | ||||||||||||||||||||
Impairments | ||||||||||||||||||||
Other operating expense | ||||||||||||||||||||
Total Operating Expenses | ||||||||||||||||||||
INCOME (LOSS) FROM OPERATIONS | ( | ) | ||||||||||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||||||||
Interest income (expense) | ( | ) | ( | ) | ( | ) | ||||||||||||||
Losses on investments | ( | ) | ( | ) | ( | ) | ||||||||||||||
Gains on purchases or exchanges of debt | ||||||||||||||||||||
Other income | ||||||||||||||||||||
Equity in net earnings of subsidiary | ( | ) | ( | ) | ||||||||||||||||
Total Other Expense | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
INCOME (LOSS) BEFORE INCOME TAXES | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
INCOME TAX BENEFIT | ( | ) | ( | ) | ( | ) | ||||||||||||||
NET INCOME (LOSS) | ( | ) | ( | ) | ||||||||||||||||
Net loss attributable to noncontrolling interests | ||||||||||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | ( | ) | ( | ) | ||||||||||||||||
Other comprehensive income | ||||||||||||||||||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||
Parent | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
REVENUES: | ||||||||||||||||||||
Oil, natural gas and NGL | $ | $ | $ | $ | $ | |||||||||||||||
Marketing | ||||||||||||||||||||
Total Revenues | ||||||||||||||||||||
Other | ||||||||||||||||||||
Gains on sales of assets | ||||||||||||||||||||
Total Revenues and Other | ||||||||||||||||||||
OPERATING EXPENSES: | ||||||||||||||||||||
Oil, natural gas and NGL production | ||||||||||||||||||||
Oil, natural gas and NGL gathering, processing and transportation | ||||||||||||||||||||
Production taxes | ||||||||||||||||||||
Exploration | ||||||||||||||||||||
Marketing | ||||||||||||||||||||
General and administrative | ||||||||||||||||||||
Restructuring and other termination costs | ||||||||||||||||||||
Provision for legal contingencies, net | ||||||||||||||||||||
Depreciation, depletion and amortization | ||||||||||||||||||||
Impairments | ||||||||||||||||||||
Other operating income | ( | ) | ( | ) | ||||||||||||||||
Total Operating Expenses | ||||||||||||||||||||
INCOME (LOSS) FROM OPERATIONS | ( | ) | ( | ) | ||||||||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | ||||||||||||||
Gains on investments | ||||||||||||||||||||
Losses on purchases or exchanges of debt | ( | ) | ( | ) | ||||||||||||||||
Other income | ||||||||||||||||||||
Equity in net earnings of subsidiary | ( | ) | ( | ) | ||||||||||||||||
Total Other Income (Expense) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
INCOME (LOSS) BEFORE INCOME TAXES | ( | ) | ( | ) | ( | ) | ||||||||||||||
INCOME TAX BENEFIT | ( | ) | ( | ) | ||||||||||||||||
NET INCOME (LOSS) | ( | ) | ( | ) | ( | ) | ||||||||||||||
Net income attributable to noncontrolling interests | ( | ) | ( | ) | ||||||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | ( | ) | ( | ) | ( | ) | ||||||||||||||
Other comprehensive income | ||||||||||||||||||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||
Parent | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||||||||||||
Net Cash Provided By Operating Activities | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||||||||||
Drilling and completion costs | ( | ) | ( | ) | ( | ) | ||||||||||||||
Business combination, net | ( | ) | ( | ) | ||||||||||||||||
Acquisitions of proved and unproved properties | ( | ) | ( | ) | ||||||||||||||||
Proceeds from divestitures of proved and unproved properties | ||||||||||||||||||||
Additions to other property and equipment | ( | ) | ( | ) | ( | ) | ||||||||||||||
Other investing activities | ||||||||||||||||||||
Net Cash Used In Investing Activities | ( | ) | ( | ) | ( | ) | ||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||||||||||
Proceeds from revolving credit facility borrowings | ||||||||||||||||||||
Payments on revolving credit facility borrowings | ( | ) | ( | ) | ( | ) | ||||||||||||||
Cash paid to purchase debt | ( | ) | ( | ) | ( | ) | ||||||||||||||
Cash paid for preferred stock dividends | ( | ) | ( | ) | ||||||||||||||||
Other financing activities | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
Intercompany advances, net | ( | ) | ( | ) | ||||||||||||||||
Net Cash Provided By Financing Activities | ||||||||||||||||||||
Net increase in cash and cash equivalents | ( | ) | ||||||||||||||||||
Cash and cash equivalents, beginning of period | ( | ) | ||||||||||||||||||
Cash and cash equivalents, end of period | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
Parent | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||||||||||||
Net Cash Provided By Operating Activities | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||||||||||
Drilling and completion costs | ( | ) | ( | ) | ||||||||||||||||
Acquisitions of proved and unproved properties | ( | ) | ( | ) | ||||||||||||||||
Proceeds from divestitures of proved and unproved properties | ||||||||||||||||||||
Additions to other property and equipment | ( | ) | ( | ) | ||||||||||||||||
Other investing activities | ||||||||||||||||||||
Net Cash Used In Investing Activities | ( | ) | ( | ) | ||||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||||||||||
Proceeds from revolving credit facility borrowings | ||||||||||||||||||||
Payments on revolving credit facility borrowings | ( | ) | ( | ) | ||||||||||||||||
Proceeds from issuance of senior notes, net | ||||||||||||||||||||
Cash paid to purchase debt | ( | ) | ( | ) | ||||||||||||||||
Cash paid for preferred stock dividends | ( | ) | ( | ) | ||||||||||||||||
Other financing activities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
Intercompany advances, net | ( | ) | ||||||||||||||||||
Net Cash Used In Financing Activities | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
Net increase (decrease) in cash and cash equivalents | ( | ) | ( | ) | ( | ) | ||||||||||||||
Cash and cash equivalents, beginning of period | ( | ) | ||||||||||||||||||
Cash and cash equivalents, end of period | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
ITEM 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
• | reduce total leverage to achieve long-term net debt/EBITDAX of 2x; |
• | increase net cash provided by operating activities to fund capital expenditures; |
• | improve margins through financial discipline and operating efficiencies; and |
• | maintain industry leading environmental and safety performance. |
• | acquired WildHorse, an oil and gas company with operations in the Eagle Ford Shale and Austin Chalk formations in southeast Texas, for approximately 717.4 million shares of our common stock and $381 million in cash, and the acquisition of WildHorse’s debt of $1.4 billion as of February 1, 2019. We anticipate the acquisition to materially increase our oil production and enhance our oil production mix as well as significantly reduce costs due to operational synergies that we believe the combined company will achieve. We expect |
• | restructured gas gathering and crude oil transportation contracts in the Eagle Ford, improving future returns and liquidity; |
• | privately negotiated exchanges of approximately $507 million principal amount of our outstanding senior notes for 235,563,519 shares of common stock and $186 million principal amount of our outstanding convertible senior notes for 73,389,094 shares of common stock, reducing annual interest payments; |
• | exchanged 40,000 shares of our 5.75% (Series A) Cumulative Convertible Preferred Stock for 10,367,950 shares of common stock, reducing annual preferred stock dividend payments; |
• | extended our debt maturity profile by privately exchanging approximately $884 million aggregate principal amount of our existing senior notes due in 2020 and 2021 for approximately $919 million aggregate principal amount of new 8.00% Senior Notes due 2026; and |
• | improved our cost structure in the Current Period compared to the Prior Period by reducing combined production, general and administrative, and gathering, processing and transportation expenses by $224 million, or 13%. The primary driver in the reduction is lower gathering, processing and transportation expenses due to certain 2018 divestitures. |
Oil Derivatives(a) | |||||||
Year | Type of Derivative Instrument | Notional Volume | Average NYMEX Price | ||||
(mmbbls) | |||||||
2019 | Swaps | 7 | $60.24 | ||||
2019 | Two-way collars | 1 | $58.00/$67.75 | ||||
2019 | Basis protection swaps | 2 | $5.67 | ||||
2019 | Puts | 1 | $54.43 | ||||
2020 | Swaps | 15 | $58.60 | ||||
2020 | Two-way collars | 2 | $65.00/$83.25 | ||||
2020 | Call swaptions | 2 | $63.15 | ||||
2020 | Basis protection swaps | 5 | $2.45 | ||||
Natural Gas Derivatives(a) | |||||||
Year | Type of Derivative Instrument | Notional Volume | Average NYMEX Price | ||||
(bcf) | |||||||
2019 | Swaps | 118 | $2.84 | ||||
2019 | Two-way collars | 9 | $2.75/$2.91 | ||||
2019 | Three-way collars | 15 | $2.50/$2.80/$3.10 | ||||
2019 | Calls | 6 | $12.00 | ||||
2019 | Basis protection swaps | 29 | ($0.10) | ||||
2020 | Swaps | 265 | $2.76 | ||||
2020 | Basis protection swaps | 30 | $0.08 | ||||
2020 | Call swaptions | 106 | $2.77 | ||||
2020 | Calls | 22 | $12.00 | ||||
2021 | Call swaptions | 15 | $2.80 | ||||
2022 | Call swaptions | 15 | $2.80 | ||||
(a) | Includes amounts settled in October and November 2019. |
Nine Months Ended September 30, | ||||||||
2019 | 2018 | |||||||
($ in millions) | ||||||||
Cash provided by operating activities | $ | 1,182 | $ | 1,395 | ||||
Proceeds from divestitures of proved and unproved properties, net | 110 | 395 | ||||||
Proceeds from revolving credit facility borrowings, net | 1,310 | — | ||||||
Proceeds from issuance of senior notes, net | — | 1,237 | ||||||
Proceeds from sales of other property and equipment, net | 6 | 75 | ||||||
Proceeds from sales of investments | — | 74 | ||||||
Total sources of cash and cash equivalents | $ | 2,608 | $ | 3,176 | ||||
Nine Months Ended September 30, | ||||||||
2019 | 2018 | |||||||
($ in millions) | ||||||||
Oil and Natural Gas Expenditures: | ||||||||
Drilling and completion costs | $ | 1,640 | $ | 1,407 | ||||
Acquisitions of proved and unproved properties | 31 | 118 | ||||||
Total oil and natural gas expenditures | 1,671 | 1,525 | ||||||
Other Uses of Cash and Cash Equivalents: | ||||||||
Payments on revolving credit facility borrowings, net | — | 136 | ||||||
Business combination, net | 353 | — | ||||||
Additions to other property and equipment | 27 | 11 | ||||||
Cash paid to purchase debt | 457 | 1,285 | ||||||
Extinguishment of other financing | — | 122 | ||||||
Dividends paid | 69 | 69 | ||||||
Other | 21 | 29 | ||||||
Total other uses of cash and cash equivalents | 927 | 1,652 | ||||||
Total uses of cash and cash equivalents | $ | 2,598 | $ | 3,177 | ||||
Three Months Ended September 30, 2019 | |||||||||||||||||||||||||||
Oil | Natural Gas | NGL | Total | ||||||||||||||||||||||||
mbbl per day | $/bbl | mmcf per day | $/mcf | mbbl per day | $/bbl | mboe per day | % | $/boe | |||||||||||||||||||
Marcellus | — | — | 928 | 1.85 | — | — | 154 | 32 | 11.11 | ||||||||||||||||||
Haynesville | — | — | 694 | 2.03 | — | — | 116 | 24 | 12.17 | ||||||||||||||||||
Eagle Ford | 51 | 60.13 | 161 | 2.13 | 16 | 14.24 | 94 | 20 | 38.62 | ||||||||||||||||||
Brazos Valley | 36 | 58.23 | 62 | 1.70 | 6 | 8.84 | 53 | 11 | 43.07 | ||||||||||||||||||
Powder River Basin | 20 | 54.17 | 86 | 1.96 | 5 | 11.49 | 39 | 8 | 33.09 | ||||||||||||||||||
Mid-Continent | 8 | 55.24 | 57 | 1.63 | 5 | 12.06 | 22 | 5 | 26.26 | ||||||||||||||||||
Retained assets(a) | 115 | 58.18 | 1,988 | 1.93 | 32 | 12.44 | 478 | 100 | 22.79 | ||||||||||||||||||
Divested assets | — | — | — | — | — | — | — | — | — | ||||||||||||||||||
Total | 115 | 58.18 | 1,989 | 1.93 | 32 | 12.44 | 478 | 100 | % | 22.79 | |||||||||||||||||
Three Months Ended September 30, 2018 | |||||||||||||||||||||||||||
Oil | Natural Gas | NGL | Total | ||||||||||||||||||||||||
mbbl per day | $/bbl | mmcf per day | $/mcf | mbbl per day | $/bbl | mboe per day | % | $/boe | |||||||||||||||||||
Marcellus | — | — | 812 | 2.46 | — | — | 135 | 25 | 14.77 | ||||||||||||||||||
Haynesville | — | — | 769 | 2.74 | — | — | 128 | 24 | 16.44 | ||||||||||||||||||
Eagle Ford | 58 | 74.38 | 121 | 3.26 | 21 | 28.94 | 100 | 19 | 53.48 | ||||||||||||||||||
Powder River Basin | 12 | 69.24 | 73 | 2.50 | 5 | 27.89 | 29 | 5 | 39.76 | ||||||||||||||||||
Mid-Continent | 9 | 69.76 | 60 | 2.50 | 4 | 29.73 | 23 | 4 | 38.64 | ||||||||||||||||||
Retained assets(a) | 79 | 73.07 | 1,835 | 2.63 | 30 | 28.86 | 415 | 77 | 27.66 | ||||||||||||||||||
Divested assets | 10 | 67.02 | 497 | 2.91 | 29 | 29.34 | 122 | 23 | 24.38 | ||||||||||||||||||
Total | 89 | 72.39 | 2,332 | 2.69 | 59 | 29.09 | 537 | 100 | % | 26.92 | |||||||||||||||||
Nine Months Ended September 30, 2019 | |||||||||||||||||||||||||||
Oil | Natural Gas | NGL | Total | ||||||||||||||||||||||||
mbbl per day | $/bbl | mmcf per day | $/mcf | mbbl per day | $/bbl | mboe per day | % | $/boe | |||||||||||||||||||
Marcellus | — | — | 935 | 2.57 | — | — | 156 | 32 | 15.45 | ||||||||||||||||||
Haynesville | — | — | 734 | 2.46 | — | — | 122 | 25 | 14.78 | ||||||||||||||||||
Eagle Ford | 57 | 61.95 | 153 | 2.77 | 20 | 16.75 | 102 | 21 | 41.95 | ||||||||||||||||||
Brazos Valley(b) | 31 | 60.38 | 47 | 1.80 | 5 | 8.89 | 44 | 9 | 45.75 | ||||||||||||||||||
Powder River Basin | 18 | 54.26 | 86 | 2.51 | 5 | 15.66 | 38 | 8 | 34.15 | ||||||||||||||||||
Mid-Continent | 9 | 55.57 | 58 | 2.16 | 5 | 17.05 | 23 | 5 | 29.25 | ||||||||||||||||||
Retained assets(a) | 115 | 59.81 | 2,013 | 2.52 | 35 | 15.50 | 485 | 100 | 25.71 | ||||||||||||||||||
Divested assets | — | — | 2 | 1.37 | — | — | 1 | — | — | ||||||||||||||||||
Total | 115 | 59.78 | 2,015 | 2.51 | 35 | 15.50 | 486 | 100 | % | 25.70 | |||||||||||||||||
Nine Months Ended September 30, 2018 | |||||||||||||||||||||||||||
Oil | Natural Gas | NGL | Total | ||||||||||||||||||||||||
mbbl per day | $/bbl | mmcf per day | $/mcf | mbbl per day | $/bbl | mboe per day | % | $/boe | |||||||||||||||||||
Marcellus | — | — | 830 | 2.85 | — | — | 138 | 26 | 17.14 | ||||||||||||||||||
Haynesville | — | — | 810 | 2.72 | — | — | 135 | 25 | 16.34 | ||||||||||||||||||
Eagle Ford | 60 | 70.35 | 134 | 3.26 | 19 | 26.93 | 101 | 19 | 50.88 | ||||||||||||||||||
Powder River Basin | 9 | 67.02 | 59 | 2.48 | 4 | 27.86 | 23 | 4 | 38.28 | ||||||||||||||||||
Mid-Continent | 9 | 66.27 | 61 | 2.52 | 4 | 26.62 | 24 | 4 | 36.78 | ||||||||||||||||||
Retained assets(a) | 78 | 69.47 | 1,894 | 2.80 | 27 | 27.00 | 421 | 78 | 27.25 | ||||||||||||||||||
Divested assets | 13 | 63.35 | 475 | 2.87 | 28 | 26.73 | 119 | 22 | 24.25 | ||||||||||||||||||
Total | 91 | 68.63 | 2,369 | 2.82 | 55 | 26.87 | 540 | 100 | % | 26.59 | |||||||||||||||||
(a) | Includes assets retained as of September 30, 2019. |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | |||||||||||||||||
($ in millions) | ||||||||||||||||||||||
Oil | $ | 613 | $ | 594 | 3 | % | $ | 1,879 | $ | 1,698 | 11 | % | ||||||||||
Natural gas | 353 | 578 | (39 | )% | 1,384 | 1,822 | (24 | )% | ||||||||||||||
NGL | 37 | 159 | (77 | )% | 149 | 404 | (63 | )% | ||||||||||||||
Oil, natural gas and NGL sales | $ | 1,003 | $ | 1,331 | (25 | )% | $ | 3,412 | $ | 3,924 | (13 | )% | ||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
($ in millions) | ||||||||||||||||
Oil derivatives – realized gains (losses) | $ | 26 | $ | (112 | ) | $ | 18 | $ | (273 | ) | ||||||
Oil derivatives – unrealized gains (losses) | 98 | 12 | (67 | ) | (115 | ) | ||||||||||
Total gains (losses) on oil derivatives | 124 | (100 | ) | (49 | ) | (388 | ) | |||||||||
Natural gas derivatives – realized gains (losses) | 83 | (1 | ) | 71 | 83 | |||||||||||
Natural gas derivatives – unrealized gains (losses) | (40 | ) | (17 | ) | 119 | (168 | ) | |||||||||
Total gains (losses) on natural gas derivatives | 43 | (18 | ) | 190 | (85 | ) | ||||||||||
NGL derivatives – realized gains (losses) | — | (10 | ) | — | (14 | ) | ||||||||||
NGL derivatives – unrealized gains (losses) | — | (4 | ) | — | (13 | ) | ||||||||||
Total gains (losses) on NGL derivatives | — | (14 | ) | — | (27 | ) | ||||||||||
Total gains (losses) on oil, natural gas and NGL derivatives | $ | 167 | $ | (132 | ) | $ | 141 | $ | (500 | ) | ||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | |||||||||||||||||
($ in millions) | ||||||||||||||||||||||
Marketing revenues | $ | 889 | $ | 1,219 | (27 | )% | $ | 3,038 | $ | 3,738 | (19 | )% | ||||||||||
Marketing expenses | 901 | 1,238 | (27 | )% | 3,071 | 3,798 | (19 | )% | ||||||||||||||
Marketing gross margin | $ | (12 | ) | $ | (19 | ) | 37 | % | $ | (33 | ) | $ | (60 | ) | 45 | % | ||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | |||||||||||||||||
($ in millions) | ||||||||||||||||||||||
Other revenue | $ | 15 | $ | 16 | (6 | )% | $ | 45 | $ | 48 | (6 | )% | ||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | |||||||||||||||||
($ in millions) | ||||||||||||||||||||||
Marcellus | 9 | 8 | 13 | % | 27 | 25 | 8 | % | ||||||||||||||
Haynesville | 12 | 15 | (20 | )% | 39 | 45 | (13 | )% | ||||||||||||||
Eagle Ford | 45 | 42 | 7 | % | 141 | 141 | — | % | ||||||||||||||
Brazos Valley | 25 | — | n/a | 62 | — | n/a | ||||||||||||||||
Powder River Basin | 20 | 12 | 67 | % | 51 | 35 | 46 | % | ||||||||||||||
Mid-Continent | 24 | 27 | (11 | )% | 75 | 73 | 3 | % | ||||||||||||||
Retained Assets(a) | 135 | 104 | 30 | % | 395 | 319 | 24 | % | ||||||||||||||
Divested Assets | — | 12 | (100 | )% | (1 | ) | 50 | (102 | )% | |||||||||||||
Total | 135 | 116 | 16 | % | 394 | 369 | 7 | % | ||||||||||||||
Ad valorem tax | 20 | 16 | 25 | % | 59 | 48 | 23 | % | ||||||||||||||
Total oil, natural gas and NGL production expenses | $ | 155 | $ | 132 | 17 | % | $ | 453 | $ | 417 | 9 | % | ||||||||||
($ per boe) | ||||||||||||||||||||||
Marcellus | $ | 0.63 | $ | 0.66 | (5 | )% | $ | 0.63 | $ | 0.67 | (6 | )% | ||||||||||
Haynesville | $ | 1.16 | $ | 1.28 | (9 | )% | $ | 1.16 | $ | 1.21 | (4 | )% | ||||||||||
Eagle Ford | $ | 5.24 | $ | 4.52 | 16 | % | $ | 5.08 | $ | 5.10 | — | % | ||||||||||
Brazos Valley | $ | 5.26 | $ | — | n/a | $ | 5.17 | $ | — | n/a | ||||||||||||
Powder River Basin | $ | 5.47 | $ | 4.40 | 24 | % | $ | 4.90 | $ | 5.48 | (11 | )% | ||||||||||
Mid-Continent | $ | 12.03 | $ | 12.97 | (7 | )% | $ | 11.66 | $ | 11.49 | 1 | % | ||||||||||
Retained Assets(a) | $ | 3.09 | $ | 2.72 | 14 | % | $ | 2.97 | $ | 2.78 | 7 | % | ||||||||||
Divested Assets | $ | — | $ | 1.11 | (100 | )% | $ | — | $ | 1.52 | (100 | )% | ||||||||||
Total | $ | 3.09 | $ | 2.36 | 31 | % | $ | 2.97 | $ | 2.50 | 19 | % | ||||||||||
Ad valorem tax | $ | 0.45 | $ | 0.32 | 41 | % | $ | 0.44 | $ | 0.33 | 33 | % | ||||||||||
Total oil, natural gas and NGL production expenses per boe | $ | 3.54 | $ | 2.68 | 32 | % | $ | 3.41 | $ | 2.83 | 20 | % | ||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
($ in millions, except per unit) | ||||||||||||||||
Oil, natural gas and NGL gathering, processing and transportation expenses | $ | 270 | $ | 364 | $ | 815 | $ | 1,060 | ||||||||
Oil ($ per bbl) | $ | 3.53 | $ | 3.83 | $ | 3.12 | $ | 3.75 | ||||||||
Natural gas ($ per mcf) | $ | 1.19 | $ | 1.33 | $ | 1.21 | $ | 1.30 | ||||||||
NGL ($ per bbl) | $ | 5.19 | $ | 8.59 | $ | 5.27 | $ | 8.62 | ||||||||
Total ($ per boe) | $ | 6.12 | $ | 7.36 | $ | 6.14 | $ | 7.18 | ||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | |||||||||||||||||
($ in millions, except per unit) | ||||||||||||||||||||||
Production taxes | $ | 35 | $ | 34 | 3 | % | $ | 109 | $ | 91 | 20 | % | ||||||||||
Production taxes per boe | $ | 0.79 | $ | 0.69 | 14 | % | $ | 0.82 | $ | 0.62 | 32 | % | ||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | |||||||||||||||||
($ in millions, except per unit) | ||||||||||||||||||||||
Impairments of unproved properties | $ | 1 | $ | 7 | (86 | )% | $ | 26 | $ | 60 | (57 | )% | ||||||||||
Dry hole expense | 8 | — | — | % | 8 | 21 | (62 | )% | ||||||||||||||
Geological and geophysical expense and other | 8 | 15 | (47 | )% | 22 | 42 | (48 | )% | ||||||||||||||
Exploration expense | $ | 17 | $ | 22 | (23 | )% | $ | 56 | 123 | (54 | )% | |||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | |||||||||||||||||
($ in millions, except per unit) | ||||||||||||||||||||||
Gross compensation and overhead | $ | 150 | $ | 174 | (14 | )% | $ | 530 | $ | 563 | (6 | )% | ||||||||||
Allocated to production expenses | (33 | ) | (36 | ) | (8 | )% | (105 | ) | (112 | ) | (6 | )% | ||||||||||
Allocated to marketing expenses | (3 | ) | (5 | ) | (40 | )% | (11 | ) | (16 | ) | (31 | )% | ||||||||||
Allocated to exploration expenses | (2 | ) | (3 | ) | (33 | )% | (8 | ) | (7 | ) | 14 | % | ||||||||||
Allocated to sand mine expenses | (2 | ) | — | n/a | (5 | ) | — | n/a | ||||||||||||||
Capitalized general and administrative expenses | (11 | ) | (13 | ) | (15 | )% | (37 | ) | (42 | ) | (12 | )% | ||||||||||
Reimbursed from third parties | (33 | ) | (36 | ) | (8 | )% | (106 | ) | (113 | ) | (6 | )% | ||||||||||
General and administrative expenses, net | $ | 66 | $ | 81 | (19 | )% | $ | 258 | $ | 273 | (5 | )% | ||||||||||
General and administrative expenses, net per boe | $ | 1.48 | $ | 1.63 | (9 | )% | $ | 1.94 | $ | 1.85 | 5 | % | ||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | |||||||||||||||||
($ in millions, except per unit) | ||||||||||||||||||||||
Depreciation, depletion and amortization | $ | 573 | $ | 405 | 41 | % | $ | 1,672 | $ | 1,335 | 25 | % | ||||||||||
Depreciation, depletion and amortization per boe | $ | 13.04 | $ | 8.20 | 59 | % | $ | 12.60 | $ | 9.05 | 39 | % | ||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
($ in millions) | ||||||||||||||||
Impairments due to lower forecasted commodity prices | $ | 8 | $ | — | $ | 8 | $ | 16 | ||||||||
Impairments due to anticipated sale | — | 53 | — | 55 | ||||||||||||
Total impairments of oil and natural gas properties | 8 | 53 | 8 | 71 | ||||||||||||
Impairments of other fixed assets | 1 | 5 | 3 | 51 | ||||||||||||
Total impairments | $ | 9 | $ | 58 | $ | 11 | $ | 122 | ||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
($ in millions) | ||||||||||||||||
Other operating (income) expense | $ | 15 | $ | — | $ | 79 | $ | (1 | ) | |||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
($ in millions, except per unit) | ||||||||||||||||
Interest expense on senior notes | $ | 147 | $ | 146 | $ | 444 | $ | 434 | ||||||||
Interest expense on term loan | — | 29 | — | 87 | ||||||||||||
Amortization of loan discount, issuance costs and other | 7 | 8 | 19 | 18 | ||||||||||||
Amortization of premium | — | (24 | ) | — | (72 | ) | ||||||||||
Interest expense on revolving credit facilities | 29 | 11 | 69 | 29 | ||||||||||||
Realized gains on interest rate derivatives | (1 | ) | (1 | ) | (2 | ) | (2 | ) | ||||||||
Unrealized losses on interest rate derivatives | 1 | 1 | 2 | 2 | ||||||||||||
Capitalized interest | (6 | ) | (5 | ) | (19 | ) | (14 | ) | ||||||||
Total interest expense | $ | 177 | $ | 165 | $ | 513 | $ | 482 | ||||||||
Interest expense per boe(a) | $ | 3.99 | $ | 3.32 | $ | 3.85 | $ | 3.26 | ||||||||
Average senior notes borrowings | $ | 7,930 | $ | 8,021 | $ | 8,098 | $ | 7,985 | ||||||||
Average credit facilities borrowings | $ | 2,301 | $ | 642 | $ | 1,852 | $ | 540 | ||||||||
Average term loan borrowings | $ | — | $ | 1,179 | $ | — | $ | 1,215 | ||||||||
(a) | Includes the effects of realized (gains) losses from interest rate derivatives, excludes the effects of unrealized (gains) losses from interest rate derivatives and is shown net of amounts capitalized. |
• | our ability to comply with the covenants under our revolving credit facility and other indebtedness and the related impact on our ability to continue as a going concern; |
• | the volatility of oil, natural gas and NGL prices; |
• | uncertainties inherent in estimating quantities of oil, natural gas and NGL reserves and projecting future rates of production and the amount and timing of development expenditures; |
• | our ability to replace reserves and sustain production; |
• | drilling and operating risks and resulting liabilities; |
• | our ability to generate profits or achieve targeted results in drilling and well operations; |
• | the limitations our level of indebtedness may have on our financial flexibility; |
• | our inability to access the capital markets on favorable terms; |
• | the availability of cash flows from operations and other funds to finance reserve replacement costs or satisfy our debt obligations; |
• | adverse developments or losses from pending or future litigation and regulatory proceedings, including royalty claims; |
• | effects of environmental protection laws and regulation on our business; |
• | terrorist activities and/or cyber-attacks adversely impacting our operations; |
• | effects of acquisitions and dispositions, including our acquisition of WildHorse and our ability to realize related synergies and cost savings; |
• | effects of purchase price adjustments and indemnity obligations; and |
• | other factors that are described under Risk Factors in Item 1A of our 2018 Form 10-K and this Form 10-Q. |
ITEM 3. | Quantitative and Qualitative Disclosures About Market Risk |
• | Swaps: We receive a fixed price and pay a floating market price to the counterparty for the hedged commodity. In exchange for higher fixed prices on certain of our swap trades, we may sell call options and call swaptions. |
• | Options: We occasionally sell and buy call and put options in exchange for a premium. At the time of settlement, if the market price exceeds the fixed price of the call option, we pay the counterparty the excess on sold call options and we receive the excess on bought call options. At the time of settlement, if the market price is lower than the fixed price of the put option, we receive the difference on bought put options and pay the counterparty the difference on sold put options. If the market price settles below the fixed price of the call option or above the fixed price of the put option, no payment is due from either party. |
• | Call Swaptions: We sell call swaptions to counterparties in exchange for a premium that allow the counterparty, on a specific date, to extend an existing fixed-price swap for a certain period of time or to increase the notional volumes of an existing fixed-price swap. |
• | Collars: These instruments contain a fixed floor price (put) and ceiling price (call). If the market price exceeds the call strike price or falls below the put strike price, we receive the fixed price and pay the market price. If the market price is between the put and the call strike prices, no payments are due from either party. Three-way collars include the sale by us of an additional put option in exchange for a more favorable strike price on the call option. This eliminates the counterparty’s downside exposure below the second put option strike price. |
• | Basis Protection Swaps: These instruments are arrangements that guarantee a fixed price differential to NYMEX from a specified delivery point. We receive the fixed price differential and pay the floating market price differential to the counterparty for the hedged commodity. |
Weighted Average Price | Fair Value | ||||||||||||||||||||||
Volume | Fixed | Call | Put | Differential | Asset (Liability) | ||||||||||||||||||
(mmbbl) | ($ per bbl) | ($ in millions) | |||||||||||||||||||||
Oil: | |||||||||||||||||||||||
Swaps: | |||||||||||||||||||||||
Short-term | 19 | $ | 59.17 | $ | — | $ | — | $ | — | $ | 123 | ||||||||||||
Long-term | 3 | $ | 58.71 | $ | — | $ | — | $ | — | 29 | |||||||||||||
Collars: | |||||||||||||||||||||||
Short-term | 3 | $ | — | $ | 75.22 | $ | 61.37 | $ | — | 26 | |||||||||||||
Long-term | — | $ | — | $ | 83.25 | $ | 65.00 | $ | — | 7 | |||||||||||||
Call Swaptions: | |||||||||||||||||||||||
Short-term | 2 | $ | 63.15 | $ | — | $ | — | $ | — | (1 | ) | ||||||||||||
Put Options (bought): | |||||||||||||||||||||||
Short-term | 1 | $ | — | $ | — | $ | 54.43 | $ | — | 2 | |||||||||||||
Deferred Premiums (Put Options): | |||||||||||||||||||||||
Short-term | — | $ | — | $ | — | $ | — | $ | — | (4 | ) | ||||||||||||
Basis Protection Swaps: | |||||||||||||||||||||||
Short-term | 2 | $ | — | $ | — | $ | — | $ | 5.67 | 4 | |||||||||||||
Total Oil | 186 | ||||||||||||||||||||||
(bcf) | ($ per mcf) | ||||||||||||||||||||||
Natural Gas: | |||||||||||||||||||||||
Swaps: | |||||||||||||||||||||||
Short-term | 316 | $ | 2.79 | $ | — | $ | — | $ | — | 120 | |||||||||||||
Long-term | 67 | $ | 2.76 | $ | — | $ | — | $ | — | 19 | |||||||||||||
Three-Way Collars: | |||||||||||||||||||||||
Short-term | 15 | $ | — | $ | 3.10 | $2.50/$2.80 | $ | — | 3 | ||||||||||||||
Collars: | |||||||||||||||||||||||
Short-term | 9 | $ | — | $ | 2.91 | $ | 2.75 | $ | — | 3 | |||||||||||||
Call Options (sold): | |||||||||||||||||||||||
Short-term | 22 | $ | — | $ | 12.00 | $ | — | $ | — | — | |||||||||||||
Long-term | 6 | $ | — | $ | 12.00 | $ | — | $ | — | — | |||||||||||||
Call Swaptions: | |||||||||||||||||||||||
Short-term | 79 | $ | 2.77 | $ | — | $ | — | $ | — | (3 | ) | ||||||||||||
Long-term | 57 | $ | 2.78 | $ | — | $ | — | $ | — | (4 | ) | ||||||||||||
Basis Protection Swaps: | |||||||||||||||||||||||
Short-term | 54 | $ | — | $ | — | $ | — | $ | (0.01 | ) | (1 | ) | |||||||||||
Total Natural Gas | 137 | ||||||||||||||||||||||
Total Commodities | $ | 323 | |||||||||||||||||||||
September 30, 2019 | ||||
($ in millions) | ||||
Short-term | $ | (22 | ) | |
Long-term | (18 | ) | ||
Total | $ | (40 | ) | |
September 30, 2019 | ||||
($ in millions) | ||||
Fair value of contracts outstanding, as of January 1, 2019 | $ | 282 | ||
Change in fair value of contracts | 109 | |||
Contracts realized or otherwise settled | (68 | ) | ||
Fair value of contracts outstanding, as of September 30, 2019 | $ | 323 | ||
Years of Maturity | |||||||||||||||||||||||||||
2019 | 2020 | 2021 | 2022 | 2023 | Thereafter | Total | |||||||||||||||||||||
($ in millions) | |||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||
Debt – fixed rate | $ | — | $ | 301 | $ | 294 | $ | 338 | $ | 209 | $ | 6,186 | $ | 7,328 | |||||||||||||
Average interest rate | — | % | 6.70 | % | 5.80 | % | 4.86 | % | 5.75 | % | 7.29 | % | 7.05 | % | |||||||||||||
Debt – variable rate | $ | — | $ | — | $ | 900 | $ | — | $ | 1,504 | $ | — | $ | 2,404 | |||||||||||||
Average interest rate | — | % | — | % | 4.04 | % | — | % | 4.03 | % | — | % | 4.03 | % | |||||||||||||
ITEM 4. | Controls and Procedures |
ITEM 1. | Legal Proceedings |
ITEM 1A. | Risk Factors |
• | incur additional indebtedness; |
• | make investments or loans; |
• | create liens; |
• | consummate mergers and similar fundamental changes; |
• | make restricted payments; |
• | make investments in unrestricted subsidiaries; |
• | enter into transactions with affiliates; and |
• | use the proceeds of asset sales. |
• | limit our ability to plan for, or react to, market conditions, to meet capital needs or otherwise to restrict our activities or business plan; and |
• | adversely affect our ability to finance our operations, enter into acquisitions or divestitures to engage in other business activities that would be in our interest. |
ITEM 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Period | Total Number of Shares Purchased(a) | Average Price Paid Per Share(a) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs | ||||||||||
($ in millions) | ||||||||||||||
July 1, 2019 through July 31, 2019 | 31,565 | $ | 1.98 | — | $ | — | ||||||||
August 1, 2019 through August 31, 2019 | — | $ | — | — | $ | — | ||||||||
September 1, 2019 through September 30, 2019 | — | $ | — | — | $ | — | ||||||||
Total | 31,565 | $ | 1.98 | — | ||||||||||
(a) | Includes shares of common stock purchased on behalf of our deferred compensation plan. |
ITEM 3. | Defaults Upon Senior Securities |
ITEM 4. | Mine Safety Disclosures |
ITEM 5. | Other Information |
ITEM 6. | Exhibits |
Incorporated by Reference | ||||||||||||
Exhibit Number | Exhibit Description | Form | SEC File Number | Exhibit | Filing Date | Filed or Furnished Herewith | ||||||
3.1.1 | 10-K | 001-13726 | 3.1.1 | 2/27/2019 | ||||||||
3.1.2 | 10-Q | 001-13726 | 3.1.4 | 11/10/2008 | ||||||||
3.1.3 | 10-Q | 001-13726 | 3.1.6 | 8/11/2008 | ||||||||
3.1.4 | 8-K | 001-13726 | 3.2 | 5/20/2010 | ||||||||
3.1.5 | 10-Q | 001-13726 | 3.1.5 | 8/9/2010 | ||||||||
3.2 | 8-K | 001-13726 | 3.2 | 6/19/2014 | ||||||||
4.1 | 8-K | 001-37964 | 4.1 | 2/1/2017 | ||||||||
4.2 | 8-K | 001-37964 | 4.1 | 2/1/2019 | ||||||||
4.3 | 10-Q | 001-37964 | 4.6 | 8/9/2018 | ||||||||
4.4 | 10-K | 001-37964 | 4.6 | 3/12/2018 | ||||||||
4.5 | 10-Q | 001-37964 | 4.6 | 8/10/2017 | ||||||||
4.6 | 8-K | 001-13726 | 4.2 | 4/5/2019 | ||||||||
4.7 | 8-K | 001-13726 | 4.4 | 4/5/2019 | ||||||||
10.1 | X | |||||||||||
31.1 | X | |||||||||||
31.2 | X | |||||||||||
32.1 | X | |||||||||||
32.2 | X | |||||||||||
95.1 | X | |||||||||||
101 INS | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | X | ||||||||||
101 SCH | Inline XBRL Taxonomy Extension Schema Document. | X | ||||||||||
101 CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | X | ||||||||||
101 DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | X | ||||||||||
101 LAB | Inline XBRL Taxonomy Extension Labels Linkbase Document. | X | ||||||||||
101 PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | X | ||||||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). | X | ||||||||||
† | Management contract or compensatory plan or arrangement | |||||||||||
CHESAPEAKE ENERGY CORPORATION | |||
Date: November 5, 2019 | By: | /s/ ROBERT D. LAWLER | |
Robert D. Lawler President and Chief Executive Officer | |||
Date: November 5, 2019 | By: | /s/ DOMENIC J. DELL’OSSO, JR. | |
Domenic J. Dell’Osso, Jr. Executive Vice President and Chief Financial Officer | |||
CHESAPEAKE ENERGY CORPORATION | ||
By: | /s/ Domenic J. Dell'Osso | |
Name: | Domenic J. Dell'Osso | |
Title: | Executive Vice President and Chief Financial Officer | |
By: | /s/ Ed Perks | |
Name: | Ed Perks | |
Title: | CIO | |
Investor Name | Exchanged Securities (principal amount and series of Outstanding Securities to be exchanged for Shares) | Shares | Cash Payment for Accrued Interest |
Franklin Custodian Funds - Franklin Income Fund | 107,710,000 CHK 4 7/8 04/15/22 CUSIP: 165167CN5 | 52,801,995 | 2,129,516.46 |
Franklin Custodian Funds - Franklin Income Fund | 124,251,000 CHK 5 3/4 03/15/23 CUSIP: 165167CL9 | 58,810,413 | 3,492,833.67 |
Franklin Custodian Funds - Franklin Income Fund | 145,775,000 CHK 5 1/2 09/15/26 CUSIP: 165167CY1 | 55,855,638 | 3,919,727.78 |
Franklin Custodian Funds - Franklin Income Fund | 150,000,000 CHK 8 06/15/27 CUSIP: 165167CZ8 | 64,236,209 | 2,866,666.67 |
Franklin Custodian Funds - Franklin Income Fund | 40,000 CHK 5 3/4 PERP CUSIP: CHKVP | 10,367,950 | |
Franklin Templeton Variable Insurance Products Trust - Franklin Income VIP Fund | 5,000,000 CHK 4 7/8 04/15/22 CUSIP: 165167CN5 | 2,451,118 | 98,854.17 |
Franklin Templeton Variable Insurance Products Trust - Franklin Income VIP Fund | 5,000,000 CHK 5 3/4 03/15/23 CUSIP: 165167CL9 | 2,366,597 | 140,555.56 |
Franklin Templeton Variable Insurance Products Trust - Franklin Income VIP Fund | 10,000,000 CHK 5 1/2 09/15/26 CUSIP: 165167CY1 | 3,831,634 | 268,888.89 |
• | unissued and undesignated as to series; and |
• | issued and designated as 5.75% cumulative convertible preferred stock, 5.75% cumulative convertible preferred stock (series A), 5.00% cumulative convertible preferred stock (series 2005B) and 4.50% cumulative convertible preferred stock. |
• | prior to the date the person became an interested shareholder, the board of directors of the corporation approved the business combination or transaction in which the person became an interested shareholder; |
• | upon consummation of the transaction that resulted in the person becoming an interested shareholder, the interested shareholder owned stock having at least 85% of all voting power of the corporation at the time the transaction commenced, excluding for purposes of determining the outstanding voting stock, but not the outstanding voting stock owned by the interested shareholder, stock held by directors who are also officers of the corporation and stock held by certain employee stock plans; or |
• | on or subsequent to the time the person became an interested shareholder, the business combination is approved by the board of directors of the corporation and authorized at a meeting of shareholders, and not by written consent, by the affirmative vote of the holders of at least two-thirds of all voting power not attributable to shares owned by the interested shareholder. |
• | any merger or consolidation involving the corporation and an interested shareholder; |
• | any sale, lease, exchange, mortgage, pledge, transfer or other disposition to or with an interested shareholder of 10% or more of the assets of the corporation; |
• | subject to certain exceptions, any transaction which results in the issuance or transfer by the corporation of any stock of the corporation to an interested shareholder; |
• | any transaction involving the corporation which has the effect of increasing the proportionate share of the stock of any class or series or voting power of the corporation owned by the interested shareholder; |
• | the receipt by an interested shareholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation; or |
• | any share acquisition by the interested shareholder pursuant to Section 1090.1 of the Oklahoma General Corporation Act. |
• | limited trading volume in our common stock; |
• | variations in operating results; |
• | our involvement in litigation; |
• | general U.S. or worldwide financial market conditions; |
• | conditions impacting the prices of oil and gas; |
• | announcements by us and our competitors; |
• | our liquidity and access to capital; |
• | our ability to raise additional funds; |
• | increases in our unsecured and secured indebtedness and issuances of additional equity; |
• | events impacting the energy industry; |
• | changes in government regulations; and |
• | other events that are beyond our control. |
Exhibit 31.1 | ||
1. | I have reviewed this Quarterly Report on Form 10-Q of Chesapeake Energy Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
November 5, 2019 | By: | /s/ ROBERT D. LAWLER |
Robert D. Lawler | ||
President and Chief Executive Officer | ||
Exhibit 31.2 | ||
1. | I have reviewed this Quarterly Report on Form 10-Q of Chesapeake Energy Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
November 5, 2019 | By: | /s/ DOMENIC J. DELL’OSSO, JR. |
Domenic J. Dell’Osso, Jr. | ||
Executive Vice President and Chief Financial Officer | ||
Exhibit 32.1 | ||
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
November 5, 2019 | By: | /s/ ROBERT D. LAWLER |
Robert D. Lawler President and Chief Executive Officer | ||
Exhibit 32.2 | ||
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
November 5, 2019 | By: | /s/ DOMENIC J. DELL’OSSO, JR. |
Domenic J. Dell’Osso, Jr. | ||
Executive Vice President and Chief Financial Officer | ||
Debt (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of long-term debt | Our long-term debt consisted of the following as of September 30, 2019 and December 31, 2018:
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| Schedule of private exchange offer for outstanding senior unsecured notes | In the Current Period, we issued at par approximately $919 million of 8.00% Senior Notes due 2026 (“2026 notes”) pursuant to a private exchange offer for the following outstanding senior unsecured notes:
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| Schedule of fair value of debt | Fair value is compared to the carrying value, excluding the impact of interest rate derivatives, in the table below:
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Revenue Recognition (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of disaggregation of revenue | The following table shows revenue disaggregated by operating area and product type, for the Current Quarter, the Prior Quarter, the Current Period and the Prior Period:
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| Schedule of accounts receivable | Accounts receivable as of September 30, 2019 and December 31, 2018 are detailed below:
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Debt |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt | Debt Our long-term debt consisted of the following as of September 30, 2019 and December 31, 2018:
Chesapeake Revolving Credit Facility Our Chesapeake revolving credit facility matures in September 2023 and the current aggregate commitment of the lenders and borrowing base under the facility is $3.0 billion. The revolving credit facility provides for an accordion feature, pursuant to which the aggregate commitments thereunder may be increased to up to $4.0 billion from time to time, subject to agreement of the participating lenders and certain other customary conditions. Scheduled borrowing base redeterminations will continue to occur semiannually. Our borrowing base was reaffirmed on November 1, 2019, and our next borrowing base redetermination is scheduled for the second quarter of 2020. As of September 30, 2019, we had outstanding borrowings of $1.504 billion under the Chesapeake revolving credit facility and had used $53 million of the Chesapeake revolving credit facility for various letters of credit. On February 1, 2019, we entered into a first amendment to our Chesapeake credit agreement. Among other things, the amendment (i) designated our subsidiary, Brazos Valley Longhorn, and its subsidiaries as unrestricted subsidiaries under the Chesapeake revolving credit facility and (ii) expressly permitted our initial investment in WildHorse under the limitations on investments covenant. As a result of BVL and its subsidiaries being designated as unrestricted subsidiaries under the Chesapeake revolving credit facility, transactions between BVL and its subsidiaries, on the one hand, and Chesapeake and its subsidiaries (other than BVL and its subsidiaries), on the other hand, are required to be on an arm’s-length basis, subject to certain exceptions, and Chesapeake is limited in the amount of investments it can make in BVL and its subsidiaries. Borrowings under the Chesapeake revolving credit facility bear interest at an alternative base rate (ABR) or LIBOR, at our election, plus an applicable margin ranging from 0.50%-2.00% per annum for ABR loans and 1.50%-3.00% per annum for LIBOR loans, depending on the percentage of the borrowing base then being utilized and whether our leverage ratio exceeds 4.00 to 1.00. In July 2017, the UK's Financial Conduct Authority, which regulates LIBOR, announced that it intends to phase out LIBOR as a benchmark by the end of 2021. At the present time, the Chesapeake revolving credit facility has a term that extends beyond 2021. The Chesapeake revolving credit facility provides for a mechanism to amend the facility to reflect the establishment of an alternate rate of interest upon the occurrence of certain events related to the phase-out of LIBOR. However, we have not yet pursued any technical amendment or other contractual alternative to address this matter. We are currently evaluating the potential impact of the eventual replacement of the LIBOR interest rate. The Chesapeake revolving credit facility is subject to various financial and other covenants. The terms of the Chesapeake credit agreement include covenants limiting, among other things, our ability to incur additional indebtedness, make investments or loans, incur liens, consummate mergers and similar fundamental changes, make restricted payments, make investments in unrestricted subsidiaries and enter into transactions with affiliates. The Chesapeake credit agreement contains financial covenants that require us to maintain (i) a leverage ratio, which is the ratio of consolidated indebtedness to consolidated EBITDAX, each as defined in the Chesapeake credit agreement to exclude amounts associated with unrestricted subsidiaries, of not more than 5.50 to 1 through the fiscal quarter ending September 30, 2019, which threshold decreases by 25 basis points each quarter until it reaches 4.00 to 1.00 for the fiscal quarter ending March 31, 2021 and every quarter thereafter, (ii) a secured leverage ratio of not more than 2.50 to 1.00 until the later of (x) the fiscal quarter ending March 31, 2021 or (y) the first fiscal quarter in which the Company’s leverage ratio does not exceed 4.00 to 1.00 and (iii) a fixed charge coverage ratio of not less than 2.00 to 1.00 through the fiscal quarter ending December 31, 2019; not less than 2.25 to 1.00 through the fiscal quarter ending June 30, 2020; and not less than 2.50 to 1.00 for the fiscal quarter ended September 30, 2020 and every quarter thereafter. As of September 30, 2019, we were in compliance with all applicable financial covenants under the credit agreement and we were able to borrow up to the full availability under the Chesapeake revolving credit facility and had $1.443 billion of borrowing capacity thereunder. Fluctuations in oil and natural gas prices have a material impact on our financial position, results of operations, cash flows and quantities of oil, natural gas and NGL reserves that may be economically produced. Historically, oil and natural gas prices have been volatile, and may be subject to wide fluctuations in the future. If continued depressed prices persist, combined with the scheduled reductions in the leverage ratio covenant, our ability to comply with the leverage ratio covenant during the next 12 months will be adversely affected which raises substantial doubt about our ability to continue as a going concern. Failure to comply with this covenant, if not waived, would result in an event of default under our Chesapeake revolving credit facility, the potential acceleration of outstanding debt thereunder and the potential foreclosure on the collateral securing such debt, and could cause a cross-default under our other outstanding indebtedness. We are actively pursuing with support from the Board of Directors a variety of transactions and cost-cutting measures, including but not limited to, reduction in corporate discretionary expenditures, refinancing transactions by us or our subsidiaries, capital exchange transactions, asset divestitures, reductions in capital expenditures by approximately 30% in 2020 and operational efficiencies. We believe it is probable that these measures, as we continue to implement them, will enable us to comply with our leverage ratio covenant. BVL Revolving Credit Facility In connection with the acquisition of WildHorse, our subsidiary, BVL, became the borrower under the WildHorse revolving credit facility (as amended, the “BVL revolving credit facility”). The BVL revolving credit facility has a maximum credit amount of $2.0 billion, with current aggregate commitments and a borrowing base of $1.3 billion. The BVL revolving credit facility matures in December 2021. Scheduled borrowing base redeterminations occur on at least a semi-annual basis, primarily on the basis of estimated proved reserves. The scheduled borrowing base redetermination for the fourth quarter of 2019 is ongoing, and there can be no assurance that the borrowing base will remain at $1.3 billion. As of September 30, 2019, BVL had outstanding borrowings of $900 million under its credit agreement. The BVL revolving credit facility is guaranteed by certain of BVL’s subsidiaries (the “BVL Guarantors”) and is required to be secured, and is secured, by substantially all of the assets of BVL and the BVL Guarantors, including mortgages on not less than 85% of the proved reserves of their oil and gas properties. On February 1, 2019, BVL, as successor by merger to WildHorse, entered into a sixth amendment to the BVL credit agreement. Among other things, the amendment (i) amended the merger covenant and the definition of change of control to permit our acquisition of WildHorse and (ii) permits borrowings under the BVL revolving credit facility to be used to redeem or repurchase the BVL Senior Notes so long as certain conditions are met. The obligations under the BVL revolving credit facility are the senior secured obligations of BVL and the BVL Guarantors. The obligations under the BVL revolving credit facility are not obligations of Chesapeake or any of its other subsidiaries. The obligations under the BVL revolving credit facility rank equally in right of payment with all other senior secured indebtedness of BVL and the other BVL Guarantors, and are effectively senior to the BVL and the BVL Guarantors’ senior unsecured indebtedness, including their obligations under the BVL Senior Notes, to the extent of the value of the collateral securing the BVL revolving credit facility. The BVL revolving credit facility is used for the liquidity and expenses of BVL and its subsidiaries and not Chesapeake and its other subsidiaries. Revolving loans under the BVL revolving credit facility bear interest at an ABR, Eurodollar rate or LIBOR at BVL’s election, plus an applicable margin (ranging from 0.50%-1.50% per annum for ABR loans, 1.50%-2.50% per annum for Eurodollar loans and 1.50%-2.50% per annum for LIBOR Market Index loans), depending on Brazos Valley Longhorn’s total commitment usage. The unused portion of the total commitments are subject to a commitment fee that varies from 0.375% to 0.500%, depending on BVL’s total commitment usage. In July 2017, the UK's Financial Conduct Authority, which regulates LIBOR, announced that it intends to phase out LIBOR as a benchmark by the end of 2021. At the present time, the BVL revolving credit facility has a stated maturity date in December 2021. Under the terms of the BVL revolving credit facility, the occurrence of certain events related to the phase-out of LIBOR would make Eurodollar borrowings unavailable and require BVL to borrow at the ABR rate or at an alternate rate of interest determined by the lenders under the BVL revolving credit facility as their cost of funds. We are currently evaluating the potential impact of the eventual phasing-out of LIBOR, including the amendment of the BVL revolving credit facility to implement a market-standard approach to the transition from LIBOR. The terms of the BVL credit agreement include covenants limiting, among other things, the ability of BVL and its restricted subsidiaries (as defined in the BVL credit agreement) to incur additional indebtedness, make investments or loans, incur liens, consummate mergers or similar fundamental changes, make restricted payments, including distributions to Chesapeake, and enter into transactions with affiliates, including Chesapeake and its other subsidiaries. The BVL credit agreement also contains financial covenants that require BVL to maintain (i)(x) if there are no loans outstanding thereunder, a ratio of net debt to EBITDAX (as defined in the BVL credit agreement) of not more than 4.00 to 1.00 as of the last day of each fiscal quarter or (y) if there are such loans outstanding, a ratio of total funded debt to EBITDAX of not more than 4.00 to 1.00 as of the last day of each fiscal quarter and (ii) a ratio of current assets (including availability under the BVL revolving credit facility) to current liabilities of not less than 1.00 to 1.00 as of the last day of each fiscal quarter. As of September 30, 2019, we were in compliance with all applicable financial covenants under the BVL credit agreement and we were able to borrow up to the full availability under the BVL revolving credit facility. Chesapeake Senior Notes In the Current Quarter, we privately negotiated exchanges of approximately $507 million principal amount of our outstanding senior notes for 235,563,519 shares of common stock and $186 million principal amount of our outstanding convertible senior notes for 73,389,094 shares of common stock. We recorded an aggregate net gain of approximately $64 million associated with the exchanges. In the Current Period, we issued at par approximately $919 million of 8.00% Senior Notes due 2026 (“2026 notes”) pursuant to a private exchange offer for the following outstanding senior unsecured notes:
We may redeem some or all of the 2026 notes at any time prior to March 15, 2022 at a price equal to 100% of the principal amount of the notes to be redeemed plus a “make-whole” premium. At any time prior to March 15, 2022, we also may redeem up to 35% of the aggregate principal amount of each series of notes with an amount of cash not greater than the net cash proceeds of certain equity offerings at a specified redemption price. In addition, we may redeem some or all of the 2026 notes at any time on or after March 15, 2022 at the redemption prices in accordance with the terms of the notes, the indenture and supplemental indenture governing the notes. These senior notes are unsecured obligations of Chesapeake and rank equally in right of payment with all of our other existing and future senior unsecured indebtedness and rank senior in right of payment to all of our future subordinated indebtedness. Our obligations under the senior notes are jointly and severally, fully and unconditionally guaranteed by all of our wholly owned subsidiaries that guarantee the Chesapeake revolving credit facility and certain other unsecured senior notes. We accounted for the exchange as a modification to existing debt and no gain or loss was recognized. In the Current Period, we repaid upon maturity $380 million principal amount of our Floating Rate Senior Notes due April 2019 with borrowings from our Chesapeake revolving credit facility. BVL Senior Notes As a result of the completion of the acquisition of WildHorse, BVL assumed the obligations under WildHorse’s $700 million aggregate principal amount of 6.875% Senior Notes due 2025 (the “BVL Senior Notes”) and Brazos Valley Longhorn Finance Corp. (“BVL Finance Corp.”), a wholly owned subsidiary of BVL, became a co-issuer of the BVL Senior Notes. On February 1, 2019, BVL, as successor by merger to WildHorse, and BVL Finance Corp. entered into a fourth supplemental indenture (the “BVL supplemental indenture”) to the indenture governing the BVL Senior Notes (as supplemented, the “BVL indenture”). Pursuant to the BVL supplemental indenture, (i) BVL assumed the rights and obligations of WildHorse as issuer under the BVL indenture and (ii) BVL Finance Corp. was named as a co-issuer of the BVL Senior Notes under the BVL indenture. The BVL Senior Notes are the senior unsecured obligations of BVL, BVL Finance Corp. and the other BVL Guarantors. The BVL Senior Notes are not obligations of Chesapeake or any of its other subsidiaries. The BVL Senior Notes rank equally in right of payment with all other senior unsecured indebtedness of BVL, BVL Finance Corp. and the other BVL Guarantors, and will be effectively subordinated to BVL’s, BVL Finance Corp.’s and the other BVL Guarantors’ senior secured indebtedness, including their obligations under the BVL revolving credit facility, to the extent of the value of the collateral securing such indebtedness. The BVL indenture contains customary reporting covenants (including furnishing quarterly and annual reports to the holders of the BVL Senior Notes) and restrictive covenants that, among other things, limit the ability of BVL and its subsidiaries to: (i) pay dividends on, purchase or redeem BVL’s equity interests or purchase or redeem subordinated debt, unless such distributions, purchases or redemptions are permitted by certain exceptions, including for amounts based on BVL’s operating results, subject to the satisfaction of certain conditions, and a $25 million basket; (ii) make certain investments; (iii) incur or guarantee additional indebtedness or issue certain types of equity securities; (iv) create or incur certain secured debt; (v) sell assets; (vi) consolidate, merge or transfer all or substantially all of BVL’s assets; (vii) enter into agreements that restrict distributions or other payments from BVL’s restricted subsidiaries to BVL; (viii) engage in transactions with affiliates, including Chesapeake and its other subsidiaries; and (ix) create unrestricted subsidiaries. These covenants are subject to a number of important qualifications and limitations. In addition, most of the covenants will be terminated before the BVL Senior Notes mature if at any time no default or event of default exists under the BVL indenture and the BVL Senior Notes receive an investment grade rating from both of two specified ratings agencies. The BVL indenture also contains customary events of default. The BVL credit agreement and the BVL indenture constrain the ability of BVL and its subsidiaries to make distributions or otherwise provide funds to, or guarantee the obligations of, Chesapeake and its other subsidiaries. The provisions of the BVL credit agreement and the BVL indenture require that all transactions between BVL and its subsidiaries, on the one hand, and Chesapeake and its other subsidiaries, on the other hand, be on an arm's-length basis, subject to certain exceptions. In the Current Quarter, we repurchased approximately $82 million principal amount of the BVL Senior Notes for $76 million and recorded a $6 million gain. Fair Value of Debt We estimate the fair value of our senior notes based on the market value of our publicly traded debt as determined based on the yield of our senior notes (Level 1). The fair value of all other debt is based on a market approach using estimates provided by an independent investment financial data services firm (Level 2). Fair value is compared to the carrying value, excluding the impact of interest rate derivatives, in the table below:
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Change in Accounting Principle |
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| Accounting Changes and Error Corrections [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Change in Accounting Principle | Change in Accounting Principle In the first quarter of 2019, we voluntarily changed our method of accounting for oil and natural gas exploration and development activities from the full cost method to the successful efforts method. Accordingly, financial information for prior periods has been recast to reflect retrospective application of the successful efforts method. In general, under successful efforts, exploration costs such as exploratory dry holes, exploratory geophysical and geological costs, delay rentals, unproved leasehold impairments and exploration overhead are charged against earnings as incurred, versus being capitalized under the full cost method of accounting. The successful efforts method also provides for the assessment of potential property impairments by comparing the net carrying value of oil and natural gas properties to associated projected undiscounted pre-tax future net cash flows. If the expected undiscounted pre-tax future net cash flows are lower than the unamortized capitalized costs, the capitalized costs are reduced to fair value. Under the full cost method of accounting, a write-down would be required if the net carrying value of oil and natural gas properties exceeds a full cost ceiling using an unweighted arithmetic average of commodity prices in effect on the first day of each of the previous 12 months. In addition, gains or losses, if applicable, are generally recognized on the disposition of oil and natural gas property and equipment under the successful efforts method, as opposed to an adjustment to the net carrying value of the assets remaining under the full cost method. Our condensed consolidated financial statements have been recast to reflect these differences.
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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 |
| Preferred stock, shares authorized (shares) | 20,000,000 | 20,000,000 |
| Preferred stock, shares outstanding (shares) | 5,563,458 | 5,603,458 |
| Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
| Common stock, shares authorized (shares) | 3,000,000,000 | 2,000,000,000 |
| Common stock, shares issued (shares) | 1,954,150,951 | 913,715,512 |
| Treasury stock, common shares (shares) | 5,623,592 | 3,246,553 |
| VIE, cash and cash equivalents | $ 14 | $ 4 |
| VIE, proved oil and natural gas properties | 30,288 | 25,407 |
| VIE, accumulated depreciation, depletion and amortization | (19,432) | (17,886) |
| VIE, other current liabilities | 1,490 | 1,599 |
| VIE | ||
| VIE, cash and cash equivalents | 2 | 1 |
| VIE, proved oil and natural gas properties | 755 | 755 |
| VIE, accumulated depreciation, depletion and amortization | (711) | (707) |
| VIE, other current liabilities | $ 1 | $ 2 |
Revenue Recognition |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Revenue Recognition | Revenue Recognition The FASB issued Revenue from Contracts with Customers (Topic 606) superseding virtually all existing revenue recognition guidance. We adopted this new standard in the Prior Period using the modified retrospective approach. We applied the new standard to all contracts that were not completed as of January 1, 2018 and reflected the aggregate effect of all modifications in determining and allocating the transaction price. The cumulative effect of adoption of $8 million in the Prior Period did not have a material impact on our consolidated financial statements. The following table shows revenue disaggregated by operating area and product type, for the Current Quarter, the Prior Quarter, the Current Period and the Prior Period:
Accounts Receivable Our accounts receivable are primarily from purchasers of oil, natural gas and NGL and from exploration and production companies that own interests in properties we operate. This industry concentration could affect our overall exposure to credit risk, either positively or negatively, because our purchasers and joint working interest owners may be similarly affected by changes in economic, industry or other conditions. We monitor the creditworthiness of all our counterparties and we generally require letters of credit or parent guarantees for receivables from parties deemed to have sub-standard credit, unless the credit risk can otherwise be mitigated. We utilize an allowance method in accounting for bad debt based on historical trends in addition to specifically identifying receivables that we believe may be uncollectible. Accounts receivable as of September 30, 2019 and December 31, 2018 are detailed below:
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Restructuring and Other Termination Costs (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||||
|---|---|---|---|---|---|---|---|---|---|
Jan. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
[1] | Sep. 30, 2019 |
Sep. 30, 2018 |
||||
| Restructuring Cost and Reserve [Line Items] | |||||||||
| Restructuring and other termination costs, number of positions eliminated, period percent | 13.00% | ||||||||
| Restructuring and other termination costs | $ 0 | $ 0 | $ 0 | $ 38 | [1] | ||||
| One-time termination benefits | |||||||||
| Restructuring Cost and Reserve [Line Items] | |||||||||
| Restructuring and other termination costs | $ 38 | ||||||||
| |||||||||
Derivative and Hedging Activities - Derivative Instruments in Balance Sheet Table (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| Derivatives, Fair Value [Line Items] | ||
| Derivative assets (liabilities), at fair value, net | $ 323 | $ 282 |
| Commodity contract | ||
| Derivatives, Fair Value [Line Items] | ||
| Derivative asset | 347 | 422 |
| Derivative liability | (24) | (147) |
| Energy related derivative | ||
| Derivatives, Fair Value [Line Items] | ||
| Derivative assets (liabilities), at fair value, net | 323 | 282 |
| Not designated as hedging instrument | Commodity contract | ||
| Derivatives, Fair Value [Line Items] | ||
| Derivative asset (liability), fair value, gross asset (liability) | 323 | 282 |
| Derivative asset (liability) fair value, net asset (liability), netted | 0 | 0 |
| Derivative assets (liabilities), at fair value, net | 323 | 282 |
| Short-term derivative asset | Not designated as hedging instrument | Commodity contract | ||
| Derivatives, Fair Value [Line Items] | ||
| Derivative asset, fair value, gross asset | 294 | 306 |
| Derivative asset, fair value, gross liability, netted | (22) | (104) |
| Derivative asset | 272 | 202 |
| Long-term derivative asset | Not designated as hedging instrument | Commodity contract | ||
| Derivatives, Fair Value [Line Items] | ||
| Derivative asset, fair value, gross asset | 55 | 117 |
| Derivative asset, fair value, gross liability, netted | (4) | (41) |
| Derivative asset | 51 | 76 |
| Short-term derivative liability | Not designated as hedging instrument | Commodity contract | ||
| Derivatives, Fair Value [Line Items] | ||
| Derivative liability, fair value, gross liability | (22) | (107) |
| Derivative liability, fair value, gross asset, netted | 22 | 104 |
| Derivative liability | 0 | (3) |
| Long-term derivative liability | Not designated as hedging instrument | Commodity contract | ||
| Derivatives, Fair Value [Line Items] | ||
| Derivative liability, fair value, gross liability | (4) | (41) |
| Derivative liability, fair value, gross asset, netted | 4 | 41 |
| Derivative liability | 0 | 0 |
| Future Natural Gas Prices | Short-term derivative asset | Not designated as hedging instrument | Energy related derivative | ||
| Derivatives, Fair Value [Line Items] | ||
| Derivative asset, fair value, gross asset | 0 | 7 |
| Derivative asset, fair value, gross liability, netted | 0 | 0 |
| Derivative asset | $ 0 | $ 7 |
Derivative and Hedging Activities - Marketing Revenues (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||||||
|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|||||
| Derivative [Line Items] | ||||||||
| Revenues | $ 1,003 | $ 1,331 | $ 3,412 | $ 3,924 | ||||
| Losses on undesignated marketing natural gas derivatives | 167 | (132) | 141 | (500) | ||||
| Revenues | 2,087 | 2,424 | [1] | 6,669 | 7,237 | [1] | ||
| Marketing, Gathering And Compression | Other contract | ||||||||
| Derivative [Line Items] | ||||||||
| Losses on undesignated marketing natural gas derivatives | 0 | 0 | (4) | 0 | ||||
| Marketing | Marketing, Gathering And Compression | ||||||||
| Derivative [Line Items] | ||||||||
| Revenues | 889 | 1,219 | 3,042 | 3,738 | ||||
| Marketing | ||||||||
| Derivative [Line Items] | ||||||||
| Revenues | 805 | 1,030 | 2,773 | 3,182 | ||||
| Losses on undesignated marketing natural gas derivatives | 0 | (3) | ||||||
| Revenues | $ 889 | $ 1,219 | [1] | $ 3,038 | $ 3,738 | [1] | ||
| ||||||||
Share-Based Compensation - Narrative (Details) - USD ($) $ in Millions |
9 Months Ended | 12 Months Ended |
|---|---|---|
Sep. 30, 2019 |
Dec. 31, 2018 |
|
| Participating securities | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Intrinsic value of restricted stock, vested | $ 15 | |
| Unrecognized compensation expense | $ 24 | |
| Share-based compensation expense, weighted average period for recognition | 1 year 11 months 1 day | |
| Stock option | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation expense, weighted average period for recognition | 1 year 3 months 3 days | |
| Unrecognized compensation expense | $ 7 | |
| Stock option | Management | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation, award vesting period | 3 years | |
| Stock option | Management | Minimum | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Expiration period | 7 years | |
| Stock option | Management | Maximum | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Expiration period | 10 years | |
| Performance Share Units | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation, award vesting period | 3 years | |
| Performance Share Units | Minimum | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Performance share units maximum payout percentage | 0.00% | |
| Performance Share Units | Maximum | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Performance share units maximum payout percentage | 200.00% | |
| Performance Share Units | Management | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation, award vesting period | 3 years | |
| Performance share units maximum payout percentage | 200.00% | |
| Performance share grant maximum payout percentage | 100.00% | |
| Terms of award | less than zero | |
| Performance Share Units | Management | Minimum | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| TSR component percentage performance share units | 0.00% | |
| Operational component percentage performance share ufnits | 0.00% | |
| Performance Share Units | Management | Maximum | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| TSR component percentage performance share units | 100.00% | |
| Operational component percentage performance share ufnits | 100.00% | |
| Cash Restricted Stock Units | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation, award vesting period | 3 years |
Share-Based Compensation - Liability Classified Valuation Table (Details) - 2017 Awards - Performance Share Units |
9 Months Ended |
|---|---|
Sep. 30, 2019 | |
| Grant Date Assumptions | |
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
| Volatility | 80.65% |
| Risk-free interest rate | 1.54% |
| Dividend yield for value of awards | 0.00% |
| Reporting Period Assumptions | |
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
| Volatility | 95.41% |
| Risk-free interest rate | 1.87% |
| Dividend yield for value of awards | 0.00% |
Derivative and Hedging Activities - Quantitative Disclosures Level 3 (Details) - Energy related derivative $ in Millions |
Sep. 30, 2019
USD ($)
|
|---|---|
| Oil | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Fair value, measurement with unobservable inputs reconciliations, recurring basis, asset value | $ 33 |
| Natural Gas | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Fair value, measurement with unobservable inputs reconciliations, recurring basis, liability value | $ (1) |
| Price volatility | Oil | Weighted average | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 0.3255 |
| Price volatility | Oil | Minimum | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 0.2462 |
| Price volatility | Oil | Maximum | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 0.4877 |
| Price volatility | Natural Gas | Weighted average | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 0.3740 |
| Price volatility | Natural Gas | Minimum | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 0.1337 |
| Price volatility | Natural Gas | Maximum | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 1.4537 |
Contingencies and Commitments - Narrative (Details) - USD ($) |
1 Months Ended | 8 Months Ended | ||
|---|---|---|---|---|
Aug. 28, 2019 |
Jan. 05, 2014 |
Feb. 28, 2019 |
Aug. 09, 2018 |
|
| Commonwealth of Pennsylvania, royalty underpayment | Settled litigation | ||||
| Loss Contingencies [Line Items] | ||||
| Settlement amount | $ 35,000,000 | |||
| Pennsylvania Department of Environmental Protection | Settled litigation | Chesapeake Appalachia, L.L.C. | ||||
| Loss Contingencies [Line Items] | ||||
| Settlement amount | $ 100,000 | |||
| Chaparral Energy, Inc. | Healthcare of Ontario Pension Plan (HOOPP) | Pending litigation | ||||
| Loss Contingencies [Line Items] | ||||
| Loss contingency, damages sought, value | $ 215,000,000 | |||
| FTS International, Inc. | Putative class action lawsuit | Pending litigation | ||||
| Loss Contingencies [Line Items] | ||||
| Loss contingency, damages sought, value | $ 1,000,000 |
Debt - Long-Term Debt Table (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Feb. 01, 2019 |
Dec. 31, 2018 |
|---|---|---|---|
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 9,732 | $ 8,168 | |
| Carrying amount | 9,341 | 7,722 | |
| Debt issuance costs | (46) | (53) | |
| Debt, current | (208) | (381) | |
| Current maturities of long-term debt, net | (208) | (381) | |
| Long-term debt, fair value | 9,524 | 7,787 | |
| Long-term debt, net | 9,133 | 7,341 | |
| Interest rate derivatives | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | 0 | 0 | |
| Interest rate derivatives | 1 | 1 | |
| Senior notes | Floating rate senior notes due 2019 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | 0 | 380 | |
| Carrying amount | 0 | 380 | |
| Senior notes | 6.625% senior notes due 2020 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | 208 | 437 | |
| Carrying amount | $ 208 | 437 | |
| Interest rate, stated percentage | 6.625% | ||
| Senior notes | 6.875% senior notes due 2020 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 93 | 227 | |
| Carrying amount | $ 93 | 227 | |
| Interest rate, stated percentage | 6.875% | ||
| Senior notes | 6.125% senior notes due 2021 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 167 | 548 | |
| Carrying amount | $ 167 | 548 | |
| Interest rate, stated percentage | 6.125% | ||
| Senior notes | 5.375% senior notes due 2021 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 127 | 267 | |
| Carrying amount | $ 127 | 267 | |
| Interest rate, stated percentage | 5.375% | ||
| Senior notes | 4.875% senior notes due 2022 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 338 | 451 | |
| Carrying amount | $ 338 | 451 | |
| Interest rate, stated percentage | 4.875% | ||
| Senior notes | 5.75% senior notes due 2023 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 209 | 338 | |
| Carrying amount | $ 209 | 338 | |
| Interest rate, stated percentage | 5.75% | ||
| Senior notes | 7.00% senior notes due 2024 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 850 | 850 | |
| Carrying amount | $ 850 | 850 | |
| Interest rate, stated percentage | 7.00% | ||
| Senior notes | 6.875% senior notes due 2025 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 618 | 0 | |
| Carrying amount | $ 621 | 0 | |
| Chesapeake revolving credit facility | $ 700 | ||
| Interest rate, stated percentage | 6.875% | 6.875% | |
| Senior notes | 8.00% senior notes due 2025 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 1,245 | 1,300 | |
| Carrying amount | $ 1,237 | 1,291 | |
| Interest rate, stated percentage | 8.00% | ||
| Senior notes | 7.5% senior notes due 2026 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 400 | 400 | |
| Carrying amount | 400 | 400 | |
| Senior notes | 8.00% senior notes due 2026 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | 919 | 0 | |
| Carrying amount | 885 | 0 | |
| Chesapeake revolving credit facility | $ 919 | ||
| Interest rate, stated percentage | 8.00% | ||
| Senior notes | 8.00% senior notes due 2027 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 1,090 | 1,300 | |
| Carrying amount | $ 1,089 | 1,299 | |
| Interest rate, stated percentage | 8.00% | ||
| Convertible debt | 5.5% convertible senior notes due 2026 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 1,064 | 1,250 | |
| Carrying amount | $ 758 | 866 | |
| Interest rate, stated percentage | 5.50% | ||
| Interest rate, effective percentage | 11.50% | ||
| Convertible debt | 7.5% senior notes due 2026 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Interest rate, stated percentage | 7.50% | ||
| Convertible debt | 8.00% senior notes due 2026 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Interest rate, stated percentage | 8.00% | ||
| Convertible debt | 2.25% contingent convertible senior notes due 2038 | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | $ 0 | 1 | |
| Carrying amount | $ 0 | 1 | |
| Interest rate, stated percentage | 2.25% | ||
| Line of credit | Chesapeake revolving credit facility | Revolving credit facility | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | 419 | ||
| Chesapeake revolving credit facility | $ 1,504 | 419 | |
| Line of credit | BVL revolving credit facility | Revolving credit facility | |||
| Long-Term Debt Instrument [Line Items] | |||
| Principal amount | 900 | 0 | |
| Chesapeake revolving credit facility | $ 900 | $ 0 |
Condensed Consolidating Financial Information - Statements of Cash Flows (Details) - USD ($) $ in Millions |
9 Months Ended | ||||
|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||
| Net Cash Provided By Operating Activities | $ 1,182 | $ 1,395 | [1] | ||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||
| Drilling and completion costs | (1,640) | (1,407) | [1] | ||
| Business combination, net | (353) | 0 | [1] | ||
| Acquisitions of proved and unproved properties | (31) | (118) | [1] | ||
| Proceeds from divestitures of proved and unproved properties | 110 | 395 | [1] | ||
| Additions to other property and equipment | (27) | (11) | [1] | ||
| Other investing activities | 6 | 149 | |||
| Net Cash Used In Investing Activities | (1,935) | (992) | [1] | ||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||
| Proceeds from revolving credit facility borrowings | 8,805 | 9,095 | [1] | ||
| Payments on revolving credit facility borrowings | (7,495) | (9,231) | [1] | ||
| Proceeds from issuance of senior notes, net | 0 | 1,237 | [1] | ||
| Cash paid to purchase debt | (457) | (1,285) | [1] | ||
| Cash paid for preferred stock dividends | (69) | (69) | [1] | ||
| Other financing activities | (21) | (151) | |||
| Intercompany advances, net | 0 | 0 | |||
| Net Cash Provided By (Used In) Financing Activities | 763 | (404) | [1] | ||
| Net increase (decrease) in cash and cash equivalents | 10 | (1) | [1] | ||
| Cash and cash equivalents, beginning of period | 4 | 5 | [1] | ||
| Cash and cash equivalents, end of period | 14 | 4 | [1] | ||
| Eliminations | |||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||
| Net Cash Provided By Operating Activities | (3) | (10) | |||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||
| Drilling and completion costs | 0 | 0 | |||
| Business combination, net | 0 | ||||
| Acquisitions of proved and unproved properties | 0 | 0 | |||
| Proceeds from divestitures of proved and unproved properties | 0 | 0 | |||
| Additions to other property and equipment | 0 | 0 | |||
| Other investing activities | 0 | 0 | |||
| Net Cash Used In Investing Activities | 0 | 0 | |||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||
| Proceeds from revolving credit facility borrowings | 0 | 0 | |||
| Payments on revolving credit facility borrowings | 0 | 0 | |||
| Proceeds from issuance of senior notes, net | 0 | ||||
| Cash paid to purchase debt | 0 | 0 | |||
| Cash paid for preferred stock dividends | 0 | 0 | |||
| Other financing activities | 3 | (13) | |||
| Intercompany advances, net | (1) | 22 | |||
| Net Cash Provided By (Used In) Financing Activities | 2 | 9 | |||
| Net increase (decrease) in cash and cash equivalents | (1) | (1) | |||
| Cash and cash equivalents, beginning of period | (2) | (3) | |||
| Cash and cash equivalents, end of period | (3) | (4) | |||
| Parent | Reportable legal entities | |||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||
| Net Cash Provided By Operating Activities | 0 | 86 | |||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||
| Drilling and completion costs | 0 | 0 | |||
| Business combination, net | 0 | ||||
| Acquisitions of proved and unproved properties | 0 | 0 | |||
| Proceeds from divestitures of proved and unproved properties | 0 | 0 | |||
| Additions to other property and equipment | 0 | 0 | |||
| Other investing activities | 0 | 0 | |||
| Net Cash Used In Investing Activities | 0 | 0 | |||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||
| Proceeds from revolving credit facility borrowings | 8,096 | 9,095 | |||
| Payments on revolving credit facility borrowings | (7,011) | (9,231) | |||
| Proceeds from issuance of senior notes, net | 1,237 | ||||
| Cash paid to purchase debt | (381) | (1,285) | |||
| Cash paid for preferred stock dividends | (69) | (69) | |||
| Other financing activities | (13) | (2) | |||
| Intercompany advances, net | (620) | 170 | |||
| Net Cash Provided By (Used In) Financing Activities | 2 | (85) | |||
| Net increase (decrease) in cash and cash equivalents | 2 | 1 | |||
| Cash and cash equivalents, beginning of period | 4 | 5 | |||
| Cash and cash equivalents, end of period | 6 | 6 | |||
| Guarantor Subsidiaries | Reportable legal entities | |||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||
| Net Cash Provided By Operating Activities | 898 | 1,312 | |||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||
| Drilling and completion costs | (1,204) | (1,407) | |||
| Business combination, net | (381) | ||||
| Acquisitions of proved and unproved properties | (31) | (118) | |||
| Proceeds from divestitures of proved and unproved properties | 110 | 395 | |||
| Additions to other property and equipment | (12) | (11) | |||
| Other investing activities | 6 | 149 | |||
| Net Cash Used In Investing Activities | (1,512) | (992) | |||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||
| Proceeds from revolving credit facility borrowings | 0 | 0 | |||
| Payments on revolving credit facility borrowings | 0 | 0 | |||
| Proceeds from issuance of senior notes, net | 0 | ||||
| Cash paid to purchase debt | 0 | 0 | |||
| Cash paid for preferred stock dividends | 0 | 0 | |||
| Other financing activities | (6) | (127) | |||
| Intercompany advances, net | 620 | (193) | |||
| Net Cash Provided By (Used In) Financing Activities | 614 | (320) | |||
| Net increase (decrease) in cash and cash equivalents | 0 | 0 | |||
| Cash and cash equivalents, beginning of period | 1 | 1 | |||
| Cash and cash equivalents, end of period | 1 | 1 | |||
| Non-Guarantor Subsidiaries | Reportable legal entities | |||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||
| Net Cash Provided By Operating Activities | 287 | 7 | |||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||
| Drilling and completion costs | (436) | 0 | |||
| Business combination, net | 28 | ||||
| Acquisitions of proved and unproved properties | 0 | 0 | |||
| Proceeds from divestitures of proved and unproved properties | 0 | 0 | |||
| Additions to other property and equipment | (15) | 0 | |||
| Other investing activities | 0 | 0 | |||
| Net Cash Used In Investing Activities | (423) | 0 | |||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||
| Proceeds from revolving credit facility borrowings | 709 | 0 | |||
| Payments on revolving credit facility borrowings | (484) | 0 | |||
| Proceeds from issuance of senior notes, net | 0 | ||||
| Cash paid to purchase debt | (76) | 0 | |||
| Cash paid for preferred stock dividends | 0 | 0 | |||
| Other financing activities | (5) | (9) | |||
| Intercompany advances, net | 1 | 1 | |||
| Net Cash Provided By (Used In) Financing Activities | 145 | (8) | |||
| Net increase (decrease) in cash and cash equivalents | 9 | (1) | |||
| Cash and cash equivalents, beginning of period | 1 | 2 | |||
| Cash and cash equivalents, end of period | $ 10 | $ 1 | |||
| |||||
Revenue Recognition - Additional Information (Details) - Retained Earnings - USD ($) $ in Millions |
Jan. 01, 2019 |
Jan. 01, 2018 |
|||
|---|---|---|---|---|---|
| Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
| Cumulative effect of accounting change | $ 0 | $ (8) | [1] | ||
| ASU 2014-09 | |||||
| Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
| Cumulative effect of accounting change | $ (8) | ||||
| |||||
Leases - Narrative (Details) $ in Millions |
9 Months Ended | 12 Months Ended | |
|---|---|---|---|
|
Feb. 01, 2019
USD ($)
contract
|
Sep. 30, 2019
USD ($)
|
Dec. 31, 2018 |
|
| Lessee, Lease, Description [Line Items] | |||
| Operating lease liability | $ 25 | ||
| Operating lease, right-of-use asset | $ 22 | ||
| Natural Gas Compressors | Midcon Compression, L.L.C. | |||
| Lessee, Lease, Description [Line Items] | |||
| Lease terms | 38 months | ||
| Wildhorse Resource Development Corporation | |||
| Lessee, Lease, Description [Line Items] | |||
| Operating lease liability | $ 40 | ||
| Operating lease, right-of-use asset | 38 | ||
| Lease incentive | $ 2 | ||
| Number of leases | contract | 2 | ||
| Minimum | |||
| Lessee, Lease, Description [Line Items] | |||
| Lease, remaining lease term | 1 month | ||
| Maximum | |||
| Lessee, Lease, Description [Line Items] | |||
| Lease, remaining lease term | 7 years 3 months 18 days |
Fair Value Measurements - Assets and Liabilities Table (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Fair value, net asset (liability), total | $ 1 | $ (1) |
| Short-term derivative asset | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Other current assets | 46 | 50 |
| Short-term derivative liability | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Other current liabilities | (45) | (51) |
| Quoted Prices in Active Markets (Level 1) | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Fair value, net asset (liability), total | 1 | (1) |
| Quoted Prices in Active Markets (Level 1) | Short-term derivative asset | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Other current assets | 46 | 50 |
| Quoted Prices in Active Markets (Level 1) | Short-term derivative liability | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Other current liabilities | (45) | (51) |
| Significant Other Observable Inputs (Level 2) | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Fair value, net asset (liability), total | 0 | 0 |
| Significant Other Observable Inputs (Level 2) | Short-term derivative asset | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Other current assets | 0 | 0 |
| Significant Other Observable Inputs (Level 2) | Short-term derivative liability | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Other current liabilities | 0 | 0 |
| Significant Unobservable Inputs (Level 3) | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Fair value, net asset (liability), total | 0 | 0 |
| Significant Unobservable Inputs (Level 3) | Short-term derivative asset | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Other current assets | 0 | 0 |
| Significant Unobservable Inputs (Level 3) | Short-term derivative liability | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Other current liabilities | $ 0 | $ 0 |
Equity - Common Stock (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
| Common stock, shares issued, beginning balance (shares) | 1,634,486,000 | 913,271,000 | 913,715,512 | 908,733,000 | ||||||
| Restricted stock issuances (net of forfeitures and cancellations) | 344,000 | 421,000 | 3,738,000 | 4,959,000 | ||||||
| Common stock, shares issued, ending balance (shares) | 1,954,150,951 | 913,692,000 | 1,954,150,951 | 913,692,000 | ||||||
| Loss on exchange of preferred stock | $ 17,000 | $ 0 | [1] | $ 17,000 | $ 0 | [1] | ||||
| Wildhorse Resource Development Corporation | ||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
| Common shares issued for WildHorse Merger | 0 | 0 | 717,376 | 0 | ||||||
| COMMON STOCK | ||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
| Common shares issued for WildHorse Merger | $ 0 | $ 0 | [2] | $ 7,000 | $ 0 | [2] | ||||
| COMMON STOCK | Exchange of convertible notes for shares of common stock | ||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
| Stock issued, exchanged (in shares) | 73,389,000 | 0 | 73,389,000 | 0 | ||||||
| COMMON STOCK | Exchange of senior notes for shares of common stock | ||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
| Stock issued, exchanged (in shares) | 235,564,000 | 0 | 235,564,000 | 0 | ||||||
| COMMON STOCK | Exchange of preferred stock for shares of common stock | ||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
| Stock issued, exchanged (in shares) | 10,367,950 | 0 | 10,368,000 | 0 | ||||||
| PREFERRED STOCK | ||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
| Stock issued, exchanged (in shares) | 40,000 | 0 | 40,000 | 0 | ||||||
| PREFERRED STOCK | 5.75% Series A Cumulative Convertible Preferred Stock | ||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
| Stock issued, exchanged (in shares) | 40,000 | |||||||||
| Interest rate, stated percentage | 5.75% | 5.75% | ||||||||
| ||||||||||
Change in Accounting Principle - Statements of Operations (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | 9 Months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | $ 2,087 | $ 2,424 | [1] | $ 6,669 | $ 7,237 | [1] | |||||||
| Gains on sales of assets | 13 | (10) | [1] | 33 | 27 | [1],[2] | |||||||
| OPERATING EXPENSES: | |||||||||||||
| Production taxes | 35 | 34 | [1] | 109 | 91 | [1] | |||||||
| General and administrative | 66 | 81 | [1] | 258 | 273 | [1] | |||||||
| Restructuring and other termination costs | 0 | 0 | [1] | 0 | 38 | [1] | |||||||
| Provision for legal contingencies, net | 0 | 8 | [1] | 3 | 17 | [1] | |||||||
| Depreciation, depletion and amortization | 573 | 405 | [1] | 1,672 | 1,335 | [1],[2] | |||||||
| Impairments | 9 | 58 | [1] | 11 | 122 | [1],[2] | |||||||
| Gain on sale of oil and natural gas properties | 0 | ||||||||||||
| Other operating (income) expense | 15 | 0 | [1] | 79 | (1) | [1] | |||||||
| Total Operating Expenses | 2,041 | 2,342 | [1] | 6,527 | 7,273 | [1] | |||||||
| INCOME (LOSS) FROM OPERATIONS | 46 | 82 | [1] | 142 | (36) | [1] | |||||||
| OTHER INCOME (EXPENSE): | |||||||||||||
| Interest expense | (177) | (165) | [1] | (513) | (482) | [1] | |||||||
| Gains (losses) on investments | (4) | 0 | [1] | (28) | 139 | [1] | |||||||
| Gains (losses) on purchases or exchanges of debt | 70 | (68) | [1] | 70 | (68) | [1] | |||||||
| Other income | 3 | 6 | [1] | 30 | 62 | [1] | |||||||
| Total Other Expense | (108) | (227) | [1] | (441) | (349) | [1] | |||||||
| LOSS BEFORE INCOME TAXES | (62) | (145) | [1] | (299) | (385) | [1] | |||||||
| INCOME TAX (BENEFIT) EXPENSE | (1) | 1 | [1] | (315) | (8) | [1] | |||||||
| NET INCOME (LOSS) | (61) | (146) | [1],[3] | 16 | (377) | [1],[2],[3] | |||||||
| Net income attributable to noncontrolling interests | 0 | 0 | [1],[3] | 0 | (1) | [1],[3] | |||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | (61) | (146) | [1] | 16 | (378) | [1] | |||||||
| Preferred stock dividends | (23) | (23) | [1] | (69) | (69) | [1] | |||||||
| Earnings allocated to participating securities | 0 | [1] | 0 | [1] | 0 | ||||||||
| Loss on exchange of preferred stock | (17) | 0 | [1] | (17) | 0 | [1] | |||||||
| NET LOSS AVAILABLE TO COMMON STOCKHOLDERS | $ (101) | $ (169) | [1] | $ (70) | $ (447) | [1] | |||||||
| EARNINGS (LOSS) PER COMMON SHARE: | |||||||||||||
| Basic (in dollars per share) | $ (0.06) | $ (0.19) | [1] | $ (0.04) | $ (0.49) | [1] | |||||||
| Diluted (in dollars per share) | $ (0.06) | $ (0.19) | [1] | $ (0.04) | $ (0.49) | [1] | |||||||
| WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions): | |||||||||||||
| Basic (in shares) | 1,698 | 910 | [1] | 1,570 | 909 | [1] | |||||||
| Diluted (in shares) | 1,698 | 910 | [1] | 1,570 | 909 | [1] | |||||||
| Oil, natural gas and NGL | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | $ 1,170 | $ 1,199 | [1] | $ 3,553 | $ 3,424 | [1] | |||||||
| Marketing | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | 889 | 1,219 | [1] | 3,038 | 3,738 | [1] | |||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | 901 | 1,238 | [1] | 3,071 | 3,798 | [1] | |||||||
| Oil, natural gas and NGL and Marketing | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | 2,059 | 2,418 | [1] | 6,591 | 7,162 | [1] | |||||||
| Other | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | 15 | 16 | [1] | 45 | 48 | [1] | |||||||
| Oil, natural gas and NGL production | |||||||||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | 155 | 132 | [1] | 453 | 417 | [1] | |||||||
| Oil, natural gas and NGL gathering, processing and transportation | |||||||||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | 270 | 364 | [1] | 815 | 1,060 | [1] | |||||||
| Exploration | |||||||||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | 17 | 22 | [1] | 56 | 123 | [1] | |||||||
| Under Full Cost | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | 2,059 | 2,418 | 6,591 | 7,162 | |||||||||
| Gains on sales of assets | 0 | 0 | 0 | 0 | |||||||||
| OPERATING EXPENSES: | |||||||||||||
| Production taxes | 35 | 34 | 109 | 91 | |||||||||
| General and administrative | 52 | 66 | 216 | 229 | |||||||||
| Restructuring and other termination costs | 38 | ||||||||||||
| Provision for legal contingencies, net | 8 | 3 | 17 | ||||||||||
| Depreciation, depletion and amortization | 421 | 291 | 1,197 | 867 | |||||||||
| Impairments | 1 | 5 | 3 | 51 | |||||||||
| Gain on sale of oil and natural gas properties | (10) | ||||||||||||
| Other operating (income) expense | 15 | 79 | 6 | ||||||||||
| Total Operating Expenses | 1,850 | 2,138 | 5,936 | 6,574 | |||||||||
| INCOME (LOSS) FROM OPERATIONS | 209 | 280 | 655 | 588 | |||||||||
| OTHER INCOME (EXPENSE): | |||||||||||||
| Interest expense | (134) | (127) | (400) | (367) | |||||||||
| Gains (losses) on investments | (4) | (28) | 139 | ||||||||||
| Gains (losses) on purchases or exchanges of debt | 70 | (68) | 70 | (68) | |||||||||
| Other income | 2 | 1 | 22 | 63 | |||||||||
| Total Other Expense | (66) | (194) | (336) | (233) | |||||||||
| LOSS BEFORE INCOME TAXES | 143 | 86 | 319 | 355 | |||||||||
| INCOME TAX (BENEFIT) EXPENSE | (1) | 1 | (315) | (8) | |||||||||
| NET INCOME (LOSS) | 144 | 85 | 634 | 363 | |||||||||
| Net income attributable to noncontrolling interests | 0 | (1) | (1) | (3) | |||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | 84 | 633 | 360 | ||||||||||
| Preferred stock dividends | (23) | (23) | (69) | (69) | |||||||||
| Earnings allocated to participating securities | (1) | (2) | (3) | ||||||||||
| Loss on exchange of preferred stock | (17) | (17) | |||||||||||
| NET LOSS AVAILABLE TO COMMON STOCKHOLDERS | $ 104 | $ 60 | $ 545 | $ 288 | |||||||||
| EARNINGS (LOSS) PER COMMON SHARE: | |||||||||||||
| Basic (in dollars per share) | $ 0.06 | $ 0.07 | $ 0.35 | $ 0.32 | |||||||||
| Diluted (in dollars per share) | $ 0.06 | $ 0.07 | $ 0.35 | $ 0.32 | |||||||||
| WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions): | |||||||||||||
| Basic (in shares) | 1,698 | 910 | 1,570 | 909 | |||||||||
| Diluted (in shares) | 1,698 | 911 | 1,570 | 909 | |||||||||
| Under Full Cost | Oil, natural gas and NGL | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | $ 1,170 | $ 1,199 | $ 3,553 | $ 3,424 | |||||||||
| Under Full Cost | Marketing | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | 889 | 1,219 | 3,038 | 3,738 | |||||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | 901 | 1,238 | 3,071 | 3,798 | |||||||||
| Under Full Cost | Oil, natural gas and NGL and Marketing | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | 2,059 | 2,418 | 6,591 | 7,162 | |||||||||
| Under Full Cost | Other | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | 0 | 0 | 0 | 0 | |||||||||
| Under Full Cost | Oil, natural gas and NGL production | |||||||||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | 155 | 132 | 453 | 417 | |||||||||
| Under Full Cost | Oil, natural gas and NGL gathering, processing and transportation | |||||||||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | 270 | 364 | 815 | 1,060 | |||||||||
| Under Full Cost | Exploration | |||||||||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | 0 | 0 | 0 | 0 | |||||||||
| Successful Efforts Adjustment | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | 28 | 6 | 78 | 75 | |||||||||
| Gains on sales of assets | 13 | (10) | 33 | 27 | |||||||||
| OPERATING EXPENSES: | |||||||||||||
| Production taxes | 0 | 0 | 0 | 0 | |||||||||
| General and administrative | 14 | 15 | 42 | 44 | |||||||||
| Restructuring and other termination costs | 0 | ||||||||||||
| Provision for legal contingencies, net | 0 | 0 | 0 | ||||||||||
| Depreciation, depletion and amortization | 152 | 114 | 475 | 468 | |||||||||
| Impairments | 8 | 53 | 8 | 71 | |||||||||
| Gain on sale of oil and natural gas properties | 10 | ||||||||||||
| Other operating (income) expense | 0 | 0 | (7) | ||||||||||
| Total Operating Expenses | 191 | 204 | 591 | 699 | |||||||||
| INCOME (LOSS) FROM OPERATIONS | (163) | (198) | (513) | (624) | |||||||||
| OTHER INCOME (EXPENSE): | |||||||||||||
| Interest expense | (43) | (38) | (113) | (115) | |||||||||
| Gains (losses) on investments | 0 | 0 | 0 | ||||||||||
| Gains (losses) on purchases or exchanges of debt | 0 | 0 | 0 | 0 | |||||||||
| Other income | 1 | 5 | 8 | (1) | |||||||||
| Total Other Expense | (42) | (33) | (105) | (116) | |||||||||
| LOSS BEFORE INCOME TAXES | (205) | (231) | (618) | (740) | |||||||||
| INCOME TAX (BENEFIT) EXPENSE | 0 | 0 | 0 | 0 | |||||||||
| NET INCOME (LOSS) | (205) | (231) | (618) | (740) | |||||||||
| Net income attributable to noncontrolling interests | 0 | 1 | 1 | 2 | |||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | (205) | (230) | (617) | (738) | |||||||||
| Preferred stock dividends | 0 | 0 | 0 | 0 | |||||||||
| Earnings allocated to participating securities | 1 | 2 | 3 | ||||||||||
| Loss on exchange of preferred stock | 0 | 0 | |||||||||||
| NET LOSS AVAILABLE TO COMMON STOCKHOLDERS | $ (205) | $ (229) | $ (615) | $ (735) | |||||||||
| EARNINGS (LOSS) PER COMMON SHARE: | |||||||||||||
| Basic (in dollars per share) | $ (0.12) | $ (0.26) | $ (0.39) | $ (0.81) | |||||||||
| Diluted (in dollars per share) | $ (0.12) | $ (0.26) | $ (0.39) | $ (0.81) | |||||||||
| WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions): | |||||||||||||
| Basic (in shares) | 0 | 0 | 0 | 0 | |||||||||
| Diluted (in shares) | 0 | (1) | 0 | 0 | |||||||||
| Successful Efforts Adjustment | Oil, natural gas and NGL | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | $ 0 | $ 0 | $ 0 | $ 0 | |||||||||
| Successful Efforts Adjustment | Marketing | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | 0 | 0 | 0 | 0 | |||||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | 0 | 0 | 0 | 0 | |||||||||
| Successful Efforts Adjustment | Oil, natural gas and NGL and Marketing | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | 0 | 0 | 0 | 0 | |||||||||
| Successful Efforts Adjustment | Other | |||||||||||||
| REVENUES AND OTHER: | |||||||||||||
| Revenues | 15 | 16 | 45 | 48 | |||||||||
| Successful Efforts Adjustment | Oil, natural gas and NGL production | |||||||||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | 0 | 0 | 0 | 0 | |||||||||
| Successful Efforts Adjustment | Oil, natural gas and NGL gathering, processing and transportation | |||||||||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | 0 | 0 | 0 | 0 | |||||||||
| Successful Efforts Adjustment | Exploration | |||||||||||||
| OPERATING EXPENSES: | |||||||||||||
| Expense | $ 17 | $ 22 | $ 56 | $ 123 | |||||||||
| |||||||||||||
Oil and Natural Gas Property Transactions - Narrative (Details) shares in Millions, $ in Millions |
3 Months Ended | 5 Months Ended | 9 Months Ended | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Feb. 01, 2019
USD ($)
shares
|
Sep. 30, 2019
USD ($)
|
Jun. 30, 2019
USD ($)
|
Sep. 30, 2018
USD ($)
well
|
Jun. 30, 2019
USD ($)
|
Sep. 30, 2019
USD ($)
|
Sep. 30, 2018
USD ($)
a
well
|
|||||||
| Business Acquisition [Line Items] | |||||||||||||
| Revenues | $ 2,087 | $ 2,424 | [1] | $ 6,669 | $ 7,237 | [1] | |||||||
| Proceeds from divestitures of proved and unproved properties | 110 | 395 | [2] | ||||||||||
| Mid-Continent | |||||||||||||
| Business Acquisition [Line Items] | |||||||||||||
| Proceeds from divestitures of proved and unproved properties | $ 491 | ||||||||||||
| Number of net acres included in sale | a | 238,500 | ||||||||||||
| Productive gas wells, number of wells, net | well | 3,200 | 3,200 | |||||||||||
| Other properties | |||||||||||||
| Business Acquisition [Line Items] | |||||||||||||
| Proceeds from divestitures of proved and unproved properties | $ 28 | $ 8 | $ 110 | $ 31 | |||||||||
| Wildhorse Resource Development Corporation | |||||||||||||
| Business Acquisition [Line Items] | |||||||||||||
| Common stock issued in the merger (in shares) | shares | 717.4 | ||||||||||||
| Cash | $ 381 | ||||||||||||
| Revenues | $ 543 | ||||||||||||
| Operating expenses | 579 | ||||||||||||
| Other expenses | $ 67 | ||||||||||||
| |||||||||||||
Fair Value Measurements |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Fair Value Measurements | Fair Value Measurements Recurring Fair Value Measurements Other Current Assets. Assets related to our deferred compensation plan are included in other current assets. The fair value of these assets is determined using quoted market prices, as they consist of exchange-traded securities. Other Current Liabilities. Liabilities related to our deferred compensation plan are included in other current liabilities. The fair values of these liabilities are determined using quoted market prices, as the plan consists of exchange-traded mutual funds. Financial Assets (Liabilities). The following table provides fair value measurement information for the above-noted financial assets (liabilities) measured at fair value on a recurring basis as of September 30, 2019 and December 31, 2018:
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Derivative and Hedging Activities |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Derivative and Hedging Activities | Derivative and Hedging Activities We use derivative instruments to reduce our exposure to fluctuations in future commodity prices and to protect our expected operating cash flow against significant market movements or volatility. All of our oil, natural gas and NGL derivative instruments are net settled based on the difference between the fixed-price payment and the floating-price payment, resulting in a net amount due to or from the counterparty. None of our open oil, natural gas or NGL derivative instruments were designated for hedge accounting as of September 30, 2019 or December 31, 2018. Oil, Natural Gas and NGL Derivatives As of September 30, 2019 and December 31, 2018, our oil, natural gas and NGL derivative instruments consisted of the following types of instruments:
The estimated fair values of our oil, natural gas and NGL derivative instrument assets (liabilities) as of September 30, 2019 and December 31, 2018 are provided below:
We have terminated certain commodity derivative contracts that were previously designated as cash flow hedges for which the original contract months are yet to occur. See further discussion below under Effect of Derivative Instruments – Accumulated Other Comprehensive Income (Loss). Contingent Consideration Arrangements In 2018, we sold our Utica Shale position to EAP Ohio, LLC (“Encino”). The purchase and sale agreement with Encino provides for additional contingent payments to us of up to $100 million comprised of $50 million in consideration in each case if, on or prior to December 31, 2019, there is a period of twenty (20) trading days out of a period of thirty (30) consecutive trading days where (i) the average of the NYMEX natural gas strip prices for the months comprising the year 2022 equals or exceeds $3.00/mmbtu as calculated pursuant to the purchase agreement, and (ii) the average of the NYMEX natural gas strip price for the months comprising the year 2023 equals or exceeds $3.25/mmbtu as calculated pursuant to the purchase and sale agreement. In the Current Period, based on the unlikelihood of any payout occurring related to the contingent consideration, we determined the contingent consideration had no fair value and recognized a $7 million unrealized loss, which is included as a reduction in our gains on sales of assets in the condensed consolidated statement of operations. Effect of Derivative Instruments – Condensed Consolidated Balance Sheets The following table presents the fair value and location of each classification of derivative instrument included in the condensed consolidated balance sheets as of September 30, 2019 and December 31, 2018 on a gross basis and after same-counterparty netting:
Effect of Derivative Instruments – Condensed Consolidated Statements of Operations The components of oil, natural gas and NGL revenues for the Current Quarter, the Prior Quarter, the Current Period and the Prior Period are presented below:
The components of marketing revenues for the Current Quarter, the Prior Quarter, the Current Period and the Prior Period are presented below:
Effect of Derivative Instruments – Accumulated Other Comprehensive Income (Loss) A reconciliation of the changes in accumulated other comprehensive income (loss) in our condensed consolidated statements of stockholders’ equity related to our cash flow hedges is presented below:
The accumulated other comprehensive loss as of September 30, 2019 represents the net deferred loss associated with commodity derivative contracts that were previously designated as cash flow hedges for which the original contract months are yet to occur. Remaining deferred gain or loss amounts will be recognized in earnings in the month for which the original contract months are to occur. As of September 30, 2019, we expect to transfer approximately $34 million of net loss included in accumulated other comprehensive income (loss) to net income (loss) during the next 12 months. The remaining amounts will be transferred by December 31, 2022. Credit Risk Considerations Our derivative instruments expose us to our counterparties’ credit risk. To mitigate this risk, we enter into derivative contracts only with counterparties that have a high credit rating or are deemed by us to have acceptable credit strength, and are deemed by management to be competent and competitive market-makers, and we attempt to limit our exposure to non-performance by any single counterparty. As of September 30, 2019, our oil, natural gas and NGL derivative instruments were spread among 15 counterparties. Hedging Arrangements Certain of our hedging arrangements are with counterparties that are also lenders (or affiliates of lenders) under the Chesapeake revolving credit facility and/or the BVL revolving credit facility. The contracts entered into with these counterparties are secured by the same collateral that secures the revolving credit facilities. In addition, we enter into bilateral hedging agreements with other counterparties. The counterparties’ and our obligations under the bilateral hedging agreements must be secured by cash or letters of credit to the extent that any mark-to-market amounts owed to us or by us exceed defined thresholds. As of September 30, 2019, there were no letters of credit or cash posted as collateral for our commodity derivatives. Fair Value The fair value of our derivatives is based on third-party pricing models which utilize inputs that are either readily available in the public market, such as oil, natural gas and NGL forward curves and discount rates, or can be corroborated from active markets or broker quotes. These values are compared to the values given by our counterparties for reasonableness. Since oil, natural gas and NGL swaps do not include optionality and therefore generally have no unobservable inputs, they are classified as Level 2. All other derivatives have some level of unobservable input, such as volatility curves, and are therefore classified as Level 3. Derivatives are also subject to the risk that either party to a contract will be unable to meet its obligations. We factor non-performance risk into the valuation of our derivatives using current published credit default swap rates. To date, this has not had a material impact on the values of our derivatives. The following table provides information for financial assets (liabilities) measured at fair value on a recurring basis as of September 30, 2019 and December 31, 2018:
A summary of the changes in the fair values of our financial assets (liabilities) classified as Level 3 during the Current Period and the Prior Period is presented below:
___________________________________________
Qualitative and Quantitative Disclosures about Unobservable Inputs for Level 3 Fair Value Measurements The significant unobservable inputs for Level 3 derivative contracts include market volatility. Changes in market volatility impact the fair value measurement of our derivative contracts, which is based on an estimate derived from option models. For example, an increase or decrease in the forward prices and volatility of oil and natural gas prices decreases or increases the fair value of oil and natural gas derivatives. The following table presents quantitative information about Level 3 inputs used in the fair value measurement of our commodity derivative contracts at fair value as of September 30, 2019:
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Equity - Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | ||||||
|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
| Preferred stock, shares outstanding, beginning balance (shares) | 5,603,458 | |||||||
| Preferred stock, shares outstanding, ending balance (shares) | 5,563,458 | 5,563,458 | ||||||
| 5.75% | ||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
| Preferred stock, shares outstanding, beginning balance (shares) | 770,000 | 770,000 | 770,000 | 770,000 | ||||
| Preferred stock, shares outstanding, ending balance (shares) | 770,000 | 770,000 | 770,000 | 770,000 | ||||
| Liquidation price per share (in dollars per share) | $ 1,000 | $ 1,000 | ||||||
| 5.75% (A) | ||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
| Preferred stock, shares outstanding, beginning balance (shares) | 463,000 | 463,000 | 463,000 | 463,000 | ||||
| Preferred stock, shares outstanding, ending balance (shares) | 423,000 | 463,000 | 423,000 | 463,000 | ||||
| Liquidation price per share (in dollars per share) | $ 1,000 | $ 1,000 | ||||||
| 4.50% | ||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
| Preferred stock, shares outstanding, beginning balance (shares) | 2,559,000 | 2,559,000 | 2,559,000 | 2,559,000 | ||||
| Preferred stock, shares outstanding, ending balance (shares) | 2,559,000 | 2,559,000 | 2,559,000 | 2,559,000 | ||||
| Liquidation price per share (in dollars per share) | $ 100 | $ 100 | ||||||
| 5.00% (2005B) | ||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
| Preferred stock, shares outstanding, beginning balance (shares) | 1,811,000 | 1,811,000 | 1,811,000 | 1,811,000 | ||||
| Preferred stock, shares outstanding, ending balance (shares) | 1,811,000 | 1,811,000 | 1,811,000 | 1,811,000 | ||||
| Liquidation price per share (in dollars per share) | $ 100 | $ 100 | ||||||
| PREFERRED STOCK | ||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
| Exchange of preferred stock | $ (40,000) | $ 0 | [1] | $ (40,000) | $ 0 | [1] | ||
| PREFERRED STOCK | 5.75% | ||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
| Exchange of preferred stock | 0 | 0 | ||||||
| PREFERRED STOCK | 5.75% (A) | ||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
| Exchange of preferred stock | $ (40) | $ (40) | ||||||
| Interest rate, stated percentage | 5.75% | 5.75% | ||||||
| PREFERRED STOCK | 4.50% | ||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
| Exchange of preferred stock | $ 0 | $ 0 | ||||||
| PREFERRED STOCK | 5.00% (2005B) | ||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
| Exchange of preferred stock | $ 0 | $ 0 | ||||||
| ||||||||
Revenue Recognition - Disaggregated Revenue (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||||||
|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | $ 1,003 | $ 1,331 | $ 3,412 | $ 3,924 | ||||
| Gains (losses) on oil, natural gas and NGL derivatives | 167 | (132) | 141 | (500) | ||||
| Revenues | 2,087 | 2,424 | [1] | 6,669 | 7,237 | [1] | ||
| Oil, natural gas and NGL revenue | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 1,170 | 1,199 | [1] | 3,553 | 3,424 | [1] | ||
| Marketing | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 805 | 1,030 | 2,773 | 3,182 | ||||
| Gains (losses) on oil, natural gas and NGL derivatives | 0 | (3) | ||||||
| Revenues | 889 | 1,219 | [1] | 3,038 | 3,738 | [1] | ||
| Other marketing revenue | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 84 | 189 | 268 | 556 | ||||
| Marcellus | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 158 | 184 | 656 | 646 | ||||
| Haynesville | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 129 | 195 | 494 | 605 | ||||
| Eagle Ford | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 336 | 493 | 1,168 | 1,411 | ||||
| Brazos Valley | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 209 | 548 | ||||||
| Powder River Basin | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 118 | 108 | 355 | 243 | ||||
| Mid-Continent | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 53 | 85 | 191 | 301 | ||||
| Utica | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 266 | 718 | ||||||
| Oil | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 613 | 594 | 1,879 | 1,698 | ||||
| Gains (losses) on oil, natural gas and NGL derivatives | 124 | (100) | (49) | (388) | ||||
| Oil | Oil, natural gas and NGL revenue | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 737 | 494 | 1,830 | 1,310 | ||||
| Oil | Marketing | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 603 | 707 | 1,830 | 2,125 | ||||
| Gains (losses) on oil, natural gas and NGL derivatives | 0 | 0 | ||||||
| Revenues | 683 | 826 | 2,060 | 2,506 | ||||
| Oil | Other marketing revenue | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 80 | 119 | 230 | 381 | ||||
| Oil | Marcellus | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||
| Oil | Haynesville | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 0 | 0 | 0 | 2 | ||||
| Oil | Eagle Ford | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 282 | 399 | 962 | 1,148 | ||||
| Oil | Brazos Valley | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 194 | 513 | ||||||
| Oil | Powder River Basin | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 97 | 78 | 273 | 173 | ||||
| Oil | Mid-Continent | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 40 | 58 | 131 | 196 | ||||
| Oil | Utica | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 59 | 179 | ||||||
| Natural Gas | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 353 | 578 | 1,383 | 1,822 | ||||
| Gains (losses) on oil, natural gas and NGL derivatives | 43 | (18) | 190 | (85) | ||||
| Natural Gas | Oil, natural gas and NGL revenue | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 396 | 560 | 1,573 | 1,737 | ||||
| Natural Gas | Marketing | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 165 | 211 | 741 | 733 | ||||
| Gains (losses) on oil, natural gas and NGL derivatives | 0 | (3) | ||||||
| Revenues | 169 | 281 | 776 | 908 | ||||
| Natural Gas | Other marketing revenue | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 4 | 70 | 38 | 175 | ||||
| Natural Gas | Marcellus | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 158 | 184 | 656 | 646 | ||||
| Natural Gas | Haynesville | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 129 | 195 | 494 | 603 | ||||
| Natural Gas | Eagle Ford | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 32 | 36 | 117 | 120 | ||||
| Natural Gas | Brazos Valley | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 10 | 23 | ||||||
| Natural Gas | Powder River Basin | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 16 | 17 | 59 | 40 | ||||
| Natural Gas | Mid-Continent | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 8 | 15 | 34 | 63 | ||||
| Natural Gas | Utica | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 131 | 350 | ||||||
| NGL | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 37 | 159 | 150 | 404 | ||||
| Gains (losses) on oil, natural gas and NGL derivatives | 0 | (14) | 0 | (27) | ||||
| NGL | Oil, natural gas and NGL revenue | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 37 | 145 | 150 | 377 | ||||
| NGL | Marketing | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 37 | 112 | 202 | 324 | ||||
| Gains (losses) on oil, natural gas and NGL derivatives | 0 | 0 | ||||||
| Revenues | 37 | 112 | 202 | 324 | ||||
| NGL | Other marketing revenue | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||
| NGL | Marcellus | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||
| NGL | Haynesville | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||
| NGL | Eagle Ford | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 22 | 58 | 89 | 143 | ||||
| NGL | Brazos Valley | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 5 | 12 | ||||||
| NGL | Powder River Basin | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | 5 | 13 | 23 | 30 | ||||
| NGL | Mid-Continent | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | $ 5 | 12 | $ 26 | 42 | ||||
| NGL | Utica | ||||||||
| Disaggregation of Revenue [Line Items] | ||||||||
| Revenues | $ 76 | $ 189 | ||||||
| ||||||||
Leases - ROU Assets and Liabilities (Details) $ in Millions |
Sep. 30, 2019
USD ($)
|
|---|---|
| Assets and Liabilities, Lessee [Abstract] | |
| Financing, ROU assets | $ 20 |
| Financing, current lease liabilities | 9 |
| Financing, long-term lease liabilities | 11 |
| Financing, present value of lease liabilities | 20 |
| Operating, ROU assets | 22 |
| Operating, current lease liabilities | 9 |
| Operating, long-term lease liabilities | 16 |
| Operating, present value of lease liabilities | $ 25 |
Condensed Consolidating Financial Information - Narrative (Details) |
Sep. 30, 2019 |
|---|---|
| Owned subsidiaries | Senior notes | |
| Condensed Financial Statements, Captions [Line Items] | |
| Noncontrolling interest, ownership percentage by parent | 100.00% |
Condensed Consolidating Financial Information (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Condensed Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Condensed Consolidated Balance Sheets | CONDENSED CONSOLIDATING BALANCE SHEET AS OF SEPTEMBER 30, 2019 ($ in millions)
CONDENSED CONSOLIDATING BALANCE SHEET AS OF DECEMBER 31, 2018 ($ in millions)
|
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| Condensed Consolidated Income Statements | CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS THREE MONTHS ENDED SEPTEMBER 30, 2019 ($ in millions)
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS THREE MONTHS ENDED SEPTEMBER 30, 2018 ($ in millions)
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 2019 ($ in millions)
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 2018 ($ in millions)
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| Condensed Consolidated Cash Flow Statements | CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2019 ($ in millions)
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2018 ($ in millions)
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Change in Accounting Principle - Statements of Shareholders' Equity (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
Jan. 01, 2019 |
Dec. 31, 2018 |
Jan. 01, 2018 |
||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | $ 2,092 | |||||||||||||||
| Net income (loss) attributable to Chesapeake | $ (61) | $ (146) | [1] | 16 | $ (378) | [1] | ||||||||||
| Chesapeake stockholders’ equity, end of period | 4,696 | 4,696 | ||||||||||||||
| Stockholders' equity attributable to noncontrolling interest, beginning of period | 41 | |||||||||||||||
| Net income attributable to noncontrolling interests | 0 | 0 | [1],[2] | 0 | (1) | [1],[2] | ||||||||||
| Stockholders' equity attributable to noncontrolling interest, end of period | 39 | 39 | ||||||||||||||
| TOTAL EQUITY | 4,735 | 1,535 | [3] | 4,735 | 1,535 | [3] | $ 2,133 | |||||||||
| PREFERRED STOCK | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | 1,671 | 1,671 | [3] | 1,671 | 1,671 | [3] | ||||||||||
| Exchange of 40,000, 0, 40,000 and 0 shares of preferred stock for common stock | (40) | 0 | [3] | (40) | 0 | [3] | ||||||||||
| Chesapeake stockholders’ equity, end of period | $ 1,631 | $ 1,671 | [3] | $ 1,631 | $ 1,671 | [3] | ||||||||||
| Preferred stock exchanges (in shares) | 40,000 | 0 | 40,000 | 0 | ||||||||||||
| COMMON STOCK | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | $ 16 | $ 9 | [3] | $ 9 | $ 9 | [3] | ||||||||||
| Exchange of senior notes and convertible senior notes | 3 | 0 | [3] | 3 | 0 | [3] | ||||||||||
| Exchange of preferred stock | 0 | 0 | ||||||||||||||
| Common shares issued for WildHorse Merger | 0 | 0 | [3] | 7 | 0 | [3] | ||||||||||
| Chesapeake stockholders’ equity, end of period | 19 | 9 | [3] | 19 | 9 | [3] | ||||||||||
| ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | 16,380 | 14,408 | [3] | 14,378 | 14,437 | [3] | ||||||||||
| Common shares issued for WildHorse Merger | 0 | 0 | [3] | 2,030 | 0 | [3] | ||||||||||
| Equity component of convertible notes repurchases | (2) | 0 | [3] | (2) | 0 | [3] | ||||||||||
| Stock-based compensation | 8 | 9 | [3] | 26 | 26 | [3] | ||||||||||
| Dividends on preferred stock | (23) | (23) | [3] | (69) | (69) | [3] | ||||||||||
| Chesapeake stockholders’ equity, end of period | 16,975 | 14,394 | [3] | 16,975 | 14,394 | [3] | ||||||||||
| ACCUMULATED DEFICIT | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | (13,835) | (14,370) | [3] | (13,912) | (14,130) | [3] | ||||||||||
| Net income (loss) attributable to Chesapeake | (61) | (146) | [3] | 16 | (378) | [3] | ||||||||||
| Cumulative effect of accounting change | $ 0 | $ (8) | [3] | |||||||||||||
| Chesapeake stockholders’ equity, end of period | [3] | (13,896) | (14,516) | (13,896) | (14,516) | |||||||||||
| ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | (5) | (40) | [3] | (23) | (57) | [3] | ||||||||||
| Hedging activity | 8 | 8 | [3] | 26 | 25 | [3] | ||||||||||
| Chesapeake stockholders’ equity, end of period | 3 | (32) | [3] | 3 | (32) | [3] | ||||||||||
| TREASURY STOCK – COMMON: | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | (36) | (31) | [3] | (31) | (31) | [3] | ||||||||||
| Purchase of 53,337, 30,509, 2,673,903, and 1,499,033 shares for company benefit plans | 0 | 0 | [3] | (7) | (4) | [3] | ||||||||||
| Release of 37,301, 41,617, 296,864 and 431,474 shares from company benefit plans | 0 | 0 | [3] | 2 | 4 | [3] | ||||||||||
| Chesapeake stockholders’ equity, end of period | $ (36) | $ (31) | [3] | $ (36) | $ (31) | [3] | ||||||||||
| Purchase of shares for company benefit plans (in shares) | 53,337 | 30,509 | 2,673,903 | 1,499,033 | ||||||||||||
| Release of shares from company benefit plans (in shares) | 37,301 | 41,617 | 296,864 | 431,474 | ||||||||||||
| TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, end of period | $ 4,696 | $ 1,495 | [3] | $ 4,696 | $ 1,495 | [3] | ||||||||||
| NONCONTROLLING INTERESTS: | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Stockholders' equity attributable to noncontrolling interest, beginning of period | 39 | 42 | [3] | 41 | 44 | [3] | ||||||||||
| Net income attributable to noncontrolling interests | 0 | 0 | [3] | 0 | 1 | [3] | ||||||||||
| Distributions to noncontrolling interest owners | 0 | (2) | [3] | (2) | (5) | [3] | ||||||||||
| Stockholders' equity attributable to noncontrolling interest, end of period | 39 | 40 | [3] | 39 | 40 | [3] | ||||||||||
| Under Full Cost | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Net income (loss) attributable to Chesapeake | 84 | 633 | 360 | |||||||||||||
| Net income attributable to noncontrolling interests | 0 | (1) | (1) | (3) | ||||||||||||
| TOTAL EQUITY | 3,687 | (40) | 3,687 | (40) | ||||||||||||
| Under Full Cost | PREFERRED STOCK | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | 1,671 | 1,671 | 1,671 | 1,671 | ||||||||||||
| Exchange of 40,000, 0, 40,000 and 0 shares of preferred stock for common stock | (40) | (40) | ||||||||||||||
| Chesapeake stockholders’ equity, end of period | 1,631 | 1,671 | 1,631 | 1,671 | ||||||||||||
| Under Full Cost | COMMON STOCK | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | 16 | 9 | 9 | 9 | ||||||||||||
| Exchange of senior notes and convertible senior notes | 3 | 3 | ||||||||||||||
| Exchange of preferred stock | 0 | 0 | ||||||||||||||
| Common shares issued for WildHorse Merger | 7 | |||||||||||||||
| Chesapeake stockholders’ equity, end of period | 19 | 9 | 19 | 9 | ||||||||||||
| Under Full Cost | ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | 16,380 | 14,408 | 14,378 | 14,437 | ||||||||||||
| Common shares issued for WildHorse Merger | 2,030 | |||||||||||||||
| Equity component of convertible notes repurchases | (2) | (2) | ||||||||||||||
| Stock-based compensation | 8 | 9 | 26 | 26 | ||||||||||||
| Dividends on preferred stock | (23) | (23) | (69) | (69) | ||||||||||||
| Chesapeake stockholders’ equity, end of period | 16,975 | 14,394 | 16,975 | 14,394 | ||||||||||||
| Under Full Cost | ACCUMULATED DEFICIT | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | (15,171) | (16,257) | (15,660) | (16,525) | ||||||||||||
| Net income (loss) attributable to Chesapeake | 144 | 84 | 360 | |||||||||||||
| Cumulative effect of accounting change | (8) | |||||||||||||||
| Chesapeake stockholders’ equity, end of period | (15,027) | (16,173) | (15,027) | (16,173) | ||||||||||||
| Under Full Cost | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | (5) | (40) | (23) | (57) | ||||||||||||
| Hedging activity | 8 | 8 | 26 | 25 | ||||||||||||
| Chesapeake stockholders’ equity, end of period | 3 | (32) | 3 | (32) | ||||||||||||
| Under Full Cost | TREASURY STOCK – COMMON: | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | (36) | (31) | (31) | (31) | ||||||||||||
| Purchase of 53,337, 30,509, 2,673,903, and 1,499,033 shares for company benefit plans | 0 | 0 | (7) | (4) | ||||||||||||
| Release of 37,301, 41,617, 296,864 and 431,474 shares from company benefit plans | 0 | 0 | 2 | 4 | ||||||||||||
| Chesapeake stockholders’ equity, end of period | (36) | (31) | (36) | (31) | ||||||||||||
| Under Full Cost | TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, end of period | 3,565 | (162) | 3,565 | (162) | ||||||||||||
| Under Full Cost | NONCONTROLLING INTERESTS: | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Stockholders' equity attributable to noncontrolling interest, beginning of period | 122 | 123 | 123 | 124 | ||||||||||||
| Net income attributable to noncontrolling interests | 0 | 1 | 1 | 3 | ||||||||||||
| Distributions to noncontrolling interest owners | 0 | (2) | (2) | (5) | ||||||||||||
| Stockholders' equity attributable to noncontrolling interest, end of period | 122 | 122 | 122 | 122 | ||||||||||||
| Successful Efforts Adjustment | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Net income (loss) attributable to Chesapeake | (205) | (230) | (617) | (738) | ||||||||||||
| Net income attributable to noncontrolling interests | 0 | 1 | 1 | 2 | ||||||||||||
| TOTAL EQUITY | 1,048 | 1,575 | 1,048 | 1,575 | ||||||||||||
| Successful Efforts Adjustment | PREFERRED STOCK | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | 0 | 0 | 0 | 0 | ||||||||||||
| Exchange of 40,000, 0, 40,000 and 0 shares of preferred stock for common stock | 0 | 0 | ||||||||||||||
| Chesapeake stockholders’ equity, end of period | 0 | 0 | 0 | 0 | ||||||||||||
| Successful Efforts Adjustment | COMMON STOCK | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | 0 | 0 | 0 | 0 | ||||||||||||
| Exchange of senior notes and convertible senior notes | 0 | 0 | ||||||||||||||
| Exchange of preferred stock | 0 | 0 | ||||||||||||||
| Common shares issued for WildHorse Merger | 0 | |||||||||||||||
| Chesapeake stockholders’ equity, end of period | 0 | 0 | 0 | 0 | ||||||||||||
| Successful Efforts Adjustment | ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | 0 | 0 | 0 | 0 | ||||||||||||
| Common shares issued for WildHorse Merger | 0 | |||||||||||||||
| Equity component of convertible notes repurchases | 0 | 0 | ||||||||||||||
| Stock-based compensation | 0 | 0 | 0 | 0 | ||||||||||||
| Dividends on preferred stock | 0 | 0 | 0 | 0 | ||||||||||||
| Chesapeake stockholders’ equity, end of period | 0 | 0 | 0 | 0 | ||||||||||||
| Successful Efforts Adjustment | ACCUMULATED DEFICIT | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | 1,336 | 1,887 | 1,748 | 2,395 | ||||||||||||
| Net income (loss) attributable to Chesapeake | (205) | (230) | (738) | |||||||||||||
| Cumulative effect of accounting change | $ 0 | |||||||||||||||
| Chesapeake stockholders’ equity, end of period | 1,131 | 1,657 | 1,131 | 1,657 | ||||||||||||
| Successful Efforts Adjustment | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | 0 | 0 | 0 | 0 | ||||||||||||
| Hedging activity | 0 | 0 | 0 | 0 | ||||||||||||
| Chesapeake stockholders’ equity, end of period | 0 | 0 | 0 | 0 | ||||||||||||
| Successful Efforts Adjustment | TREASURY STOCK – COMMON: | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, beginning of period | 0 | 0 | 0 | 0 | ||||||||||||
| Purchase of 53,337, 30,509, 2,673,903, and 1,499,033 shares for company benefit plans | 0 | 0 | 0 | 0 | ||||||||||||
| Release of 37,301, 41,617, 296,864 and 431,474 shares from company benefit plans | 0 | 0 | 0 | 0 | ||||||||||||
| Chesapeake stockholders’ equity, end of period | 0 | 0 | 0 | 0 | ||||||||||||
| Successful Efforts Adjustment | TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Chesapeake stockholders’ equity, end of period | 1,131 | 1,657 | 1,131 | 1,657 | ||||||||||||
| Successful Efforts Adjustment | NONCONTROLLING INTERESTS: | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Stockholders' equity attributable to noncontrolling interest, beginning of period | (83) | (81) | (82) | (80) | ||||||||||||
| Net income attributable to noncontrolling interests | 0 | (1) | (1) | (2) | ||||||||||||
| Distributions to noncontrolling interest owners | 0 | 0 | 0 | 0 | ||||||||||||
| Stockholders' equity attributable to noncontrolling interest, end of period | $ (83) | $ (82) | $ (83) | $ (82) | ||||||||||||
| Exchange of preferred stock for shares of common stock | COMMON STOCK | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Preferred stock exchanges (in shares) | 10,367,950 | 0 | 10,368,000 | 0 | ||||||||||||
| Exchange of preferred stock for shares of common stock | ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Exchange of preferred stock | $ 40 | $ 0 | [3] | $ 40 | $ 0 | [3] | ||||||||||
| Preferred stock exchanges (in shares) | 10,367,950 | 0 | 10,367,950 | 0 | ||||||||||||
| Exchange of preferred stock for shares of common stock | Under Full Cost | ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Exchange of preferred stock | $ 40 | $ 40 | ||||||||||||||
| Exchange of preferred stock for shares of common stock | Successful Efforts Adjustment | ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Exchange of preferred stock | $ 0 | $ 0 | ||||||||||||||
| Exchange of senior notes for shares of common stock | COMMON STOCK | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Preferred stock exchanges (in shares) | 235,564,000 | 0 | 235,564,000 | 0 | ||||||||||||
| Exchange of senior notes for shares of common stock | ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Exchange of notes | $ 438 | $ 0 | [3] | $ 438 | $ 0 | [3] | ||||||||||
| Preferred stock exchanges (in shares) | 235,563,519 | 0 | 235,563,519 | 0 | ||||||||||||
| Exchange of senior notes for shares of common stock | Under Full Cost | ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Exchange of notes | $ 438 | $ 438 | ||||||||||||||
| Exchange of senior notes for shares of common stock | Successful Efforts Adjustment | ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Exchange of notes | $ 0 | $ 0 | ||||||||||||||
| Exchange of convertible senior notes for common stock | COMMON STOCK | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Preferred stock exchanges (in shares) | 73,389,000 | 0 | 73,389,000 | 0 | ||||||||||||
| Exchange of convertible senior notes for common stock | ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Exchange of notes | $ 134 | $ 0 | [3] | $ 134 | $ 0 | [3] | ||||||||||
| Preferred stock exchanges (in shares) | 73,389,094 | 0 | 73,389,094 | 0 | ||||||||||||
| Exchange of convertible senior notes for common stock | Under Full Cost | ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Exchange of notes | $ 134 | $ 134 | ||||||||||||||
| Exchange of convertible senior notes for common stock | Successful Efforts Adjustment | ADDITIONAL PAID-IN CAPITAL | ||||||||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||
| Exchange of notes | $ 0 | $ 0 | ||||||||||||||
| ||||||||||||||||
Condensed Consolidating Financial Information |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Condensed Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Condensed Consolidating Financial Information | Condensed Consolidating Financial Information Chesapeake Energy Corporation is a holding company, owns no operating assets and has no significant operations independent of its subsidiaries. Our obligations under our outstanding senior notes, convertible senior notes and Chesapeake revolving credit facility listed in Note 6 are fully and unconditionally guaranteed, jointly and severally, by certain of our 100% owned subsidiaries. Our BVL subsidiaries are not guarantors of Chesapeake’s indebtedness and are subject to covenants under the BVL credit agreement and BVL indenture. Subsidiaries with noncontrolling interests, consolidated variable interest entities and certain de minimis subsidiaries are also non-guarantors. The tables below are condensed consolidating financial statements for Chesapeake Energy Corporation (parent) on a stand-alone, unconsolidated basis, and its combined guarantor and combined non-guarantor subsidiaries as of September 30, 2019 and December 31, 2018 and for the three and six months ended September 30, 2019 and 2018. This financial information may not necessarily be indicative of our results of operations, cash flows or financial position had these subsidiaries operated as independent entities. CONDENSED CONSOLIDATING BALANCE SHEET AS OF SEPTEMBER 30, 2019 ($ in millions)
CONDENSED CONSOLIDATING BALANCE SHEET AS OF DECEMBER 31, 2018 ($ in millions)
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS THREE MONTHS ENDED SEPTEMBER 30, 2019 ($ in millions)
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS THREE MONTHS ENDED SEPTEMBER 30, 2018 ($ in millions)
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 2019 ($ in millions)
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 2018 ($ in millions)
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2019 ($ in millions)
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2018 ($ in millions)
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Investments |
9 Months Ended |
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Sep. 30, 2019 | |
| Equity Method Investments and Joint Ventures [Abstract] | |
| Investments | Investments In the Current Period in connection with the acquisition of WildHorse, we obtained a 50% membership interest in JWH Midstream LLC (JWH). The carrying value of our investment in JWH, which was being accounted for as an equity method investment, was approximately $17 million as of March 31, 2019. In the Current Period, we paid approximately $7 million to terminate our involvement in the partnership. This removed us from any future obligations related to this joint venture and, therefore, we impaired the full value of the investment and recognized approximately $24 million of impairment expense in the Current Period. In the Prior Period, FTS International, Inc. (NYSE: FTSI) completed an initial public offering. Due to the offering, the ownership percentage of our equity method investment in FTSI decreased from approximately 29% to 24% and resulted in a gain of approximately $78 million. In addition, we sold approximately 4.3 million shares of FTSI in the offering for net proceeds of approximately $74 million and recognized a gain of approximately $61 million decreasing our ownership percentage to approximately 20%. We continue to hold approximately 22.0 million shares in the publicly traded company. In the Current Period, the hydraulic fracturing industry experienced challenging operating conditions resulting in the current fair value of our investment in FTSI to fall below book value of $65 million at the end of the Current Quarter. Given that the average NYSE closing price for FTSI shares in the Current Quarter exceeded our carrying value per share and more often than not the closing price was greater than our carrying value per share, we have not assessed the reduction in fair value of our investment in FTSI to be other-than-temporary. We will continue to monitor the hydraulic fracturing industry, FTSI operating results and FTSI share price for indications that the reduction in fair value is other-than-temporary, which could result in an impairment of our investment in FTSI.
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Earnings Per Share (Tables) |
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Earnings Per Share, Basic and Diluted, Other Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Securities excluded from calculation of diluted EPS | Shares of common stock for the following securities were excluded from the calculation of diluted EPS as the effect was antidilutive:
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Leases (Tables) |
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| Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of ROU assets and lease liabilities | The following table presents our ROU assets and lease liabilities as of September 30, 2019.
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| Schedule of operating and financing lease additional information | Additional information for the Company’s operating and finance leases is presented below:
____________________________________________ (a) Includes $38 million and $98 million of capitalized lease costs for the Current Quarter and the Current Period, respectively.
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| Schedule of maturity analysis of operating lease liabilities | Maturity analysis of finance lease liabilities and operating lease liabilities are presented below:
The aggregate undiscounted minimum future lease payments under previous lease accounting standard, ASC 840, are presented below:
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| Schedule of maturity analysis of finance lease liabilities | Maturity analysis of finance lease liabilities and operating lease liabilities are presented below:
The aggregate undiscounted minimum future lease payments under previous lease accounting standard, ASC 840, are presented below:
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Income Taxes |
9 Months Ended |
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Sep. 30, 2019 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes We estimate our annual effective tax rate for continuing operations in recording our quarterly income tax provision (or benefit) for the various jurisdictions in which we operate. The tax effects of statutory rate changes, significant unusual or infrequent items, and certain changes in the assessment of the realizability of deferred tax assets are excluded from the determination of our estimated annual effective tax rate as such items are recognized as discrete items in the quarter in which they occur. For the Current Quarter, our estimated annual effective tax rate is 0.0% as a result of maintaining a full valuation allowance against our net deferred tax asset. Taking into account our projected operating results for the fourth quarter of 2019, we project remaining in a net deferred tax asset position as of December 31, 2019. Based on all available positive and negative evidence, including projections of future taxable income, we believe it is more likely than not that these deferred tax assets will not be realized. A significant piece of objectively verifiable negative evidence evaluated is the cumulative loss incurred over the rolling thirty-six month period ended September 30, 2019. Such evidence limits our ability to consider various forms of subjective positive evidence, such as any projections for future growth and earnings. However, should we return to a level of sustained profitability, consideration will need to be given to projections of future taxable income to determine whether such projections provide an adequate source of taxable income for the realization of our deferred tax assets. A full valuation allowance was recorded against our net deferred tax asset position as of September 30, 2019 and December 31, 2018. On February 1, 2019, we completed the acquisition of WildHorse. For federal income tax purposes, the transaction qualified as a tax-free merger under Section 368 of the Internal Revenue Code of 1986, as amended, (the “Code”) and, as a result, we acquired carryover tax basis in WildHorse’s assets and liabilities. We recorded a net deferred tax liability of $314 million as part of the business combination accounting for WildHorse. As a consequence of maintaining a full valuation allowance against our net deferred tax asset, a partial release of the valuation allowance was recorded as a discrete income tax benefit of $314 million through the condensed consolidated statement of operations in the first quarter of 2019. The net deferred tax liability acquired includes deferred tax liabilities on plant, property and equipment and prepaid compensation totaling $401 million, partially offset by deferred tax assets totaling $87 million relating to federal net operating loss (NOL) carryforwards, disallowed interest carryforwards and certain other deferred tax assets. These carryforwards will be subject to an annual limitation under Section 382 of the Code of approximately $61 million. We determined that no separate valuation allowances were required to be established through business combination accounting against any of the individual deferred tax assets acquired. We are subject to U.S. federal income tax as well as income and capital taxes in various state jurisdictions in which we operate. We recorded an income tax benefit of $1 million for the Current Quarter and an income tax benefit of $315 million for the Current Period. The benefit for the Current Period was a result of the aforementioned discrete item relating to the partial release of the valuation allowance in the amount of $314 million and state income tax refunds resulting from the filing of amended state income tax returns reporting federal audit adjustments. Our ability to utilize NOL carryforwards and possibly other tax attributes to reduce future federal taxable income and federal income tax is subject to various limitations under Section 382 of the Code. The utilization of these attributes may be subject to an annual limitation under Section 382 of the Code should transactions involving our equity, including issuances of our stock or the sale or exchange of our stock by certain shareholders, result in a cumulative shift of more than 50% in the beneficial ownership of our stock during any three-year testing period (an “Ownership Change”). (For this purpose, “stock” includes certain preferred stock). Some states impose similar limitations on tax attribute utilization upon experiencing an Ownership Change. As of September 30, 2019, we do not believe that an Ownership Change has occurred that would subject us to an annual limitation on the utilization of our NOL carryforwards, disallowed interest carryforwards and other tax attributes. However, the exchanges of our common stock for certain outstanding senior notes that occurred during the Current Quarter (see Note 6 for further details of the debt exchanges) and the exchange of our common stock for certain Cumulative Convertible Preferred Stock which also occurred during the Current Quarter (see Note 12 for further details of the stock exchange) increased our cumulative shift to over 40%. As a result, future transactions involving our equity, including relatively small transactions and transactions beyond our control, could cause an Ownership Change and therefore an annual limitation on the utilization of NOL carryforwards, disallowed interest carryforwards and possibly other tax attributes. Further, proposed regulations issued on September 10, 2019, under Section 382(h) of the Code (the “Proposed Regulations”) would, if finalized in their current form, significantly reduce our annual limitation should we experience an Ownership Change on or after the date the Proposed Regulations become final. Among other changes, the Proposed Regulations would, if finalized in their current form, limit the potential increases to the annual limitation amount associated with certain built-in gains existing at the time of an Ownership Change, thereby significantly reducing the ability to utilize tax attributes. As a result, certain NOL carryforwards, disallowed interest carryforwards and other tax attributes may need to be written off or have a valuation allowance maintained against them possibly leading to a material charge to income tax expense.
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Contingencies and Commitments |
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Sep. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Contingencies and Commitments | Contingencies and Commitments There have been no material developments in previously reported legal or environmental contingencies or commitments other than the items discussed below. For a discussion of commitments and contingencies, see “Contingencies and Commitments,” Note 4 to the Consolidated Financial Statements in our 2018 Form 10-K. Contingencies Litigation and Regulatory Proceedings We are involved in a number of litigation and regulatory proceedings including those described below. Many of these proceedings are in early stages, and many of them seek or may seek damages and penalties, the amount of which is indeterminate. Our total accrued liability in respect of litigation and regulatory proceedings is determined on a case-by-case basis and represents an estimate of probable losses after considering, among other factors, the progress of each case or proceeding, our experience and the experience of others in similar cases or proceedings, and the opinions and views of legal counsel. Significant judgment is required in making these estimates and our final liabilities may ultimately be materially different. Business Operations. We are involved in various lawsuits and disputes incidental to our business operations, including commercial disputes, personal injury claims, royalty claims, property damage claims and contract actions. We and other natural gas producers have been named in various lawsuits alleging underpayment of royalties and other shares of the proceeds of production. The suits against us allege, among other things, that we used below-market prices, made improper deductions, utilized improper measurement techniques, entered into arrangements with affiliates that resulted in underpayment of amounts owed in connection with the production and sale of natural gas and NGL, or similar theories. These lawsuits include cases filed by individual royalty owners and putative class actions, some of which seek to certify a statewide class. The lawsuits seek compensatory, consequential, treble, and punitive damages, restitution and disgorgement of profits, declaratory and injunctive relief regarding our payment practices, pre-and post-judgment interest, and attorney’s fees and costs. Royalty plaintiffs have varying provisions in their respective leases, oil and gas law varies from state to state, and royalty owners and producers differ in their interpretation of the legal effect of lease provisions governing royalty calculations. We have resolved a number of these claims through negotiated settlements of past and future royalty obligations and have prevailed in various other lawsuits. We are currently defending numerous lawsuits seeking damages with respect to underpayment of royalties or other shares of the proceeds of production in multiple states where we have operated, including those discussed below. On December 9, 2015, the Commonwealth of Pennsylvania, by the Office of Attorney General, filed a lawsuit in the Bradford County Court of Common Pleas related to royalty underpayment and lease acquisition and accounting practices with respect to properties in Pennsylvania. The lawsuit, which primarily relates to the Marcellus Shale and Utica Shale, alleges that we violated the Pennsylvania Unfair Trade Practices and Consumer Protection Law (UTPCPL) by making improper deductions and entering into arrangements with affiliates that resulted in underpayment of royalties. The lawsuit includes other UTPCPL claims and antitrust claims, including that a joint exploration agreement to which we are a party established unlawful market allocation for the acquisition of leases. The lawsuit seeks statutory restitution, civil penalties and costs, as well as a temporary injunction from exploration and drilling activities in Pennsylvania until restitution, penalties and costs have been paid, and a permanent injunction from further violations of the UTPCPL. Putative statewide class actions in Pennsylvania and Ohio and purported class arbitrations in Pennsylvania have been filed on behalf of royalty owners asserting various claims for damages related to alleged underpayment of royalties as a result of the divestiture of substantially all of our midstream business and most of our gathering assets in 2012 and 2013. These cases include claims for violation of and conspiracy to violate the federal Racketeer Influenced and Corrupt Organizations Act and for an unlawful market allocation agreement for mineral rights, intentional interference with contractual relations, and violations of antitrust laws related to purported markets for gas mineral rights, operating rights and gas gathering sources. These lawsuits seek in aggregate compensatory, consequential, treble, and punitive damages, restitution and disgorgement of profits, declaratory and injunctive relief regarding our royalty payment practices, pre-and post-judgment interest, and attorney’s fees and costs. On December 20, 2017 and August 9, 2018, we reached tentative settlements to resolve substantially all Pennsylvania civil royalty cases for a total of approximately $35 million. We believe losses are reasonably possible in certain of the pending royalty cases for which we have not accrued a loss contingency, but we are currently unable to estimate an amount or range of loss or the impact the actions could have on our future results of operations or cash flows. Uncertainties in pending royalty cases generally include the complex nature of the claims and defenses, the potential size of the class in class actions, the scope and types of the properties and agreements involved, and the applicable production years. On July 24, 2018, Healthcare of Ontario Pension Plan (HOOPP) filed a demand for arbitration with the American Arbitration Association regarding HOOPP’s purchase of our interest in Chaparral Energy, Inc. stock for $215 million on January 5, 2014. HOOPP claims that we engaged in material misrepresentations and fraud, and that we violated the Securities Exchange Act of 1934 (the “Exchange Act”) and Oklahoma Uniform Securities Act. HOOPP seeks either rescission or $215 million in monetary damages, and in either case, interest, attorney’s fees, disgorgement and punitive damages. We intend to vigorously defend these claims. In February 2019, a putative class action lawsuit was filed in the District Court of Dallas County, Texas against FTS International, Inc. (FTSI), certain investment banks, FTSI’s directors including certain of our officers and certain shareholders of FTSI including us. The lawsuit alleges various violations of Sections 11 (with respect to certain of our officers in their capacities as directors of FTSI) and 15 (with respect to such officers and us) of the Securities Act of 1933 in connection with public disclosure made during the initial public offering of FTSI. The suit seeks damages in excess of $1,000,000 and attorneys’ fees and other expenses. We intend to vigorously defend these claims. Environmental Contingencies The nature of the oil and gas business carries with it certain environmental risks for us and our subsidiaries. We have implemented various policies, programs, procedures, training and audits to reduce and mitigate such environmental risks. We conduct periodic reviews, on a company-wide basis, to assess changes in our environmental risk profile. Environmental reserves are established for environmental liabilities for which economic losses are probable and reasonably estimable. We manage our exposure to environmental liabilities in acquisitions by using an evaluation process that seeks to identify pre-existing contamination or compliance concerns and address the potential liability. Depending on the extent of an identified environmental concern, we may, among other things, exclude a property from the transaction, require the seller to remediate the property to our satisfaction in an acquisition or agree to assume liability for the remediation of the property. We are named as a defendant in numerous lawsuits in Oklahoma alleging that we and other companies have engaged in activities that have caused earthquakes. These lawsuits seek compensation for injury to real and personal property, diminution of property value, economic losses due to business interruption, interference with the use and enjoyment of property, annoyance and inconvenience, personal injury and emotional distress. In addition, they seek the reimbursement of insurance premiums and the award of punitive damages, attorneys’ fees, costs, expenses and interest. We intend to vigorously defend these claims. We previously disclosed ongoing discussions between our subsidiary, Chesapeake Appalachia, L.L.C. (“CALLC”) and the Pennsylvania Department of Environmental Protection related to gas migration in the vicinity of certain of our wells in Bradford County. Those concerns were resolved by the parties on August 28, 2019. Pursuant to the settlement, CALLC paid a civil penalty of less than $100,000. Other Matters Based on management’s current assessment, we are of the opinion that no pending or threatened lawsuit or dispute relating to our business operations is likely to have a material adverse effect on our future consolidated financial position, results of operations or cash flows. The final resolution of such matters could exceed amounts accrued, however, and actual results could differ materially from management’s estimates. Commitments Gathering, Processing and Transportation Agreements We have contractual commitments with midstream service companies and pipeline carriers for future gathering, processing and transportation of oil, natural gas and NGL to move certain of our production to market. Working interest owners and royalty interest owners, where appropriate, will be responsible for their proportionate share of these costs. Commitments related to gathering, processing and transportation agreements are not recorded as obligations in the accompanying condensed consolidated balance sheets; however, they are reflected in our estimates of proved reserves. The aggregate undiscounted commitments under our gathering, processing and transportation agreements, excluding any reimbursement from working interest and royalty interest owners, credits for third-party volumes or future costs under cost-of-service agreements, are presented below:
In addition, we have entered into long-term agreements for certain natural gas gathering and related services within specified acreage dedication areas in exchange for cost-of-service based fees redetermined annually, or tiered fees based on volumes delivered relative to scheduled volumes. Future gathering fees may vary with the applicable agreement.
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions |
9 Months Ended | ||||||||
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Sep. 30, 2019 |
Sep. 30, 2018 |
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| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||
| NET INCOME (LOSS) | $ 16 | $ (377) | [1],[2],[3] | ||||||
| ADJUSTMENTS TO RECONCILE NET INCOME (LOSS) TO CASH PROVIDED BY OPERATING ACTIVITIES: | |||||||||
| Depreciation, depletion and amortization | 1,672 | 1,335 | [2],[3] | ||||||
| Deferred income tax benefit | (314) | (10) | [2] | ||||||
| Derivative (gains) losses, net | (137) | 500 | [2] | ||||||
| Cash receipts (payments) on derivative settlements, net | 129 | (162) | [2] | ||||||
| Stock-based compensation | 24 | 25 | [2] | ||||||
| Gains on sales of assets | (33) | (27) | [2],[3] | ||||||
| Impairments | 11 | 122 | [2],[3] | ||||||
| Exploration | 35 | 81 | [2] | ||||||
| (Gains) losses on investments | 21 | (139) | [2] | ||||||
| (Gains) losses on purchases or exchanges of debt | (70) | 68 | |||||||
| Other | 42 | (90) | [2] | ||||||
| Changes in assets and liabilities | (214) | 69 | [2] | ||||||
| Net Cash Provided By Operating Activities | 1,182 | 1,395 | [2] | ||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||
| Drilling and completion costs | (1,640) | (1,407) | [2] | ||||||
| Business combination, net | (353) | 0 | [2] | ||||||
| Acquisitions of proved and unproved properties | (31) | (118) | [2] | ||||||
| Proceeds from divestitures of proved and unproved properties | 110 | 395 | [2] | ||||||
| Additions to other property and equipment | (27) | (11) | [2] | ||||||
| Proceeds from sales of other property and equipment | 6 | 75 | [2] | ||||||
| Proceeds from sales of investments | 0 | 74 | [2] | ||||||
| Net Cash Used In Investing Activities | (1,935) | (992) | [2] | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||
| Proceeds from revolving credit facility borrowings | 8,805 | 9,095 | [2] | ||||||
| Payments on revolving credit facility borrowings | (7,495) | (9,231) | [2] | ||||||
| Proceeds from issuance of senior notes, net | 0 | 1,237 | [2] | ||||||
| Cash paid to purchase debt | (457) | (1,285) | [2] | ||||||
| Extinguishment of other financing | 0 | (122) | [2] | ||||||
| Cash paid for preferred stock dividends | (69) | (69) | [2] | ||||||
| Distributions to noncontrolling interest owners | (2) | (5) | [2] | ||||||
| Other | (19) | (24) | [2] | ||||||
| Net Cash Provided By (Used In) Financing Activities | 763 | (404) | [2] | ||||||
| Net increase (decrease) in cash and cash equivalents | 10 | (1) | [2] | ||||||
| Cash and cash equivalents, beginning of period | 4 | 5 | [2] | ||||||
| Cash and cash equivalents, end of period | 14 | 4 | [2] | ||||||
| SUPPLEMENTAL CASH FLOW INFORMATION: | |||||||||
| Interest paid, net of capitalized interest | 487 | 527 | [2] | ||||||
| Income taxes paid, net of refunds received | (6) | (3) | [2] | ||||||
| SUPPLEMENTAL DISCLOSURE OF SIGNIFICANT NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||||||||
| Common stock issued for business combination | 2,037 | 0 | [2] | ||||||
| Debt exchanged for common stock | 693 | 0 | [2] | ||||||
| Preferred stock exchanged for common stock | 40 | 0 | [2] | ||||||
| Change in senior notes exchanged | 35 | 0 | [2] | ||||||
| Change in accrued drilling and completion costs | |||||||||
| SUPPLEMENTAL DISCLOSURE OF SIGNIFICANT NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||||||||
| Change in non-cash investing and financing activities | 49 | 142 | [2] | ||||||
| Change in divested proved and unproved properties | |||||||||
| SUPPLEMENTAL DISCLOSURE OF SIGNIFICANT NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||||||||
| Change in non-cash investing and financing activities | $ (144) | $ (5) | [2] | ||||||
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| Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Oil and Natural Gas Property Transactions | Oil and Natural Gas Property Transactions WildHorse Acquisition On February 1, 2019, we acquired WildHorse Resource Development Corporation (“WildHorse”), an oil and gas company with operations in the Eagle Ford Shale and Austin Chalk formations in southeast Texas for approximately 717.4 million shares of our common stock and $381 million in cash. We funded the cash portion of the consideration through borrowings under the Chesapeake revolving credit facility. In connection with the closing, we acquired all of WildHorse’s debt. See Note 6 for additional information on the acquired debt. Purchase Price Allocation We have accounted for the acquisition of WildHorse and its corresponding merger (the “Merger”) with and into our wholly owned subsidiary, Brazos Valley Longhorn, L.L.C. (“Brazos Valley Longhorn” or “BVL”), as a business combination, using the acquisition method. The following table represents the preliminary allocation of the total purchase price of WildHorse to the identifiable assets acquired and the liabilities assumed based on the fair values as of the acquisition date. Certain data necessary to complete the purchase price allocation is not yet available, and includes, but is not limited to, valuation of pre-acquisition contingencies and final appraisals of assets acquired and liabilities assumed. We expect to complete the purchase price allocation during the 12-month period following the acquisition date, during which time the value of the assets and liabilities may be revised as appropriate.
___________________________________________
We included in our condensed consolidated statements of operations revenues of $543 million, direct operating expenses of $579 million and other expense of $67 million related to the WildHorse business for the period from February 1, 2019 to September 30, 2019. Pro Forma Financial Information The following unaudited pro forma financial information for the nine months ended September 30, 2019 and three and nine months ended September 30, 2018, respectively, is based on our historical consolidated financial statements adjusted to reflect as if the WildHorse acquisition had occurred on January 1, 2018. The information below reflects pro forma adjustments based on available information and certain assumptions that we believe are reasonable, including adjustments to conform the classification of expenses in WildHorse’s statements of operations to our classification for similar expenses and the estimated tax impact of pro forma adjustments.
This unaudited pro forma information has been derived from historical information. The unaudited pro forma financial information is not necessarily indicative of what actually would have occurred if the acquisition had been completed as of the beginning of the periods presented, nor is it necessarily indicative of future results. Divestitures In the Prior Period, we sold portions of our acreage, producing properties and other related property and equipment in the Mid-Continent, including our Mississippian Lime assets, for approximately $491 million, subject to certain customary closing adjustments. Included in the sales were approximately 238,500 net acres and interests in approximately 3,200 wells. Also, in the Current Quarter, the Prior Quarter, the Current Period and the Prior Period, we received proceeds of approximately $28 million, $8 million, $110 million and $31 million, respectively, subject to customary closing adjustments, for the sale of other oil and natural gas properties covering various operating areas.
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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| CURRENT ASSETS: | ||
| Cash and cash equivalents ($2 and $1 attributable to our VIE) | $ 14 | $ 4 |
| Accounts receivable, net | 977 | 1,247 |
| Short-term derivative assets | 272 | 209 |
| Other current assets | 140 | 138 |
| Total Current Assets | 1,403 | 1,598 |
| Oil and natural gas properties, at cost based on successful efforts accounting: | ||
| Proved oil and natural gas properties ($755 and $755 attributable to our VIE) | 30,288 | 25,407 |
| Unproved properties | 2,200 | 1,561 |
| Other property and equipment | 1,810 | 1,721 |
| Total Property and Equipment, at Cost | 34,298 | 28,689 |
| Less: accumulated depreciation, depletion and amortization (($711) and ($707) attributable to our VIE) | (19,432) | (17,886) |
| Property and equipment held for sale, net | 10 | 15 |
| Total Property and Equipment, Net | 14,876 | 10,818 |
| LONG-TERM ASSETS: | ||
| Long-term derivative assets | 51 | 76 |
| Other long-term assets | 249 | 243 |
| TOTAL ASSETS | 16,579 | 12,735 |
| CURRENT LIABILITIES: | ||
| Accounts payable | 526 | 763 |
| Current maturities of long-term debt, net | 208 | 381 |
| Accrued interest | 124 | 141 |
| Short-term derivative liabilities | 0 | 3 |
| Other current liabilities ($1 and $2 attributable to our VIE) | 1,490 | 1,599 |
| Total Current Liabilities | 2,348 | 2,887 |
| LONG-TERM LIABILITIES: | ||
| Long-term debt, net | 9,133 | 7,341 |
| Asset retirement obligations, net of current portion | 177 | 155 |
| Other long-term liabilities | 186 | 219 |
| Total Long-Term Liabilities | 9,496 | 7,715 |
| CONTINGENCIES AND COMMITMENTS (Note 7) | ||
| Chesapeake Stockholders’ Equity: | ||
| Preferred stock, $0.01 par value, 20,000,000 shares authorized: 5,563,458 and 5,603,458 shares outstanding | 1,631 | 1,671 |
| Common stock, $0.01 par value, 3,000,000,000 and 2,000,000,000 shares authorized: 1,954,150,951 and 913,715,512 shares issued | 19 | 9 |
| Additional paid-in capital | 16,975 | 14,378 |
| Accumulated deficit | (13,896) | (13,912) |
| Accumulated other comprehensive income (loss) | 3 | (23) |
| Less: treasury stock, at cost; 5,623,592 and 3,246,553 common shares | (36) | (31) |
| Total Chesapeake Stockholders’ Equity | 4,696 | 2,092 |
| Noncontrolling interests | 39 | 41 |
| Total Equity | 4,735 | 2,133 |
| TOTAL LIABILITIES AND EQUITY | $ 16,579 | $ 12,735 |
Derivative and Hedging Activities - Oil, Natural Gas and NGL Revenues (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||||||
|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|||||
| Derivative [Line Items] | ||||||||
| Gains (losses) on undesignated oil, natural gas and NGL derivatives | $ 167 | $ (132) | $ 141 | $ (500) | ||||
| Revenues | 2,087 | 2,424 | [1] | 6,669 | 7,237 | [1] | ||
| Oil, natural gas and NGL sales | ||||||||
| Derivative [Line Items] | ||||||||
| Losses on terminated cash flow hedges | (8) | (8) | (26) | (25) | ||||
| Oil, natural gas and NGL sales | Commodity contract | Not designated as hedging instrument | ||||||||
| Derivative [Line Items] | ||||||||
| Gains (losses) on undesignated oil, natural gas and NGL derivatives | 175 | (124) | 167 | (475) | ||||
| Oil, natural gas and NGL | ||||||||
| Derivative [Line Items] | ||||||||
| Oil, natural gas and NGL revenues | 1,003 | 1,331 | 3,412 | 3,924 | ||||
| Revenues | $ 1,170 | $ 1,199 | [1] | $ 3,553 | $ 3,424 | [1] | ||
| ||||||||
Share-Based Compensation - Restricted Stock (Details) - Participating securities shares in Thousands |
9 Months Ended |
|---|---|
|
Sep. 30, 2019
$ / shares
shares
| |
| Shares of Unvested Restricted Stock | |
| Unvested restricted stock, beginning balance (in shares) | shares | 11,858 |
| Granted (in shares) | shares | 5,370 |
| Vested (in shares) | shares | (5,439) |
| Forfeited (in shares) | shares | (1,241) |
| Unvested restricted stock, ending balance (in shares) | shares | 10,548 |
| Weighted Average Grant Date Fair Value Per Share | |
| Unvested restricted stock, beginning balance (in dollars per share) | $ / shares | $ 4.43 |
| Granted (in dollars per share) | $ / shares | 2.85 |
| Vested (in dollars per share) | $ / shares | 4.46 |
| Forfeited (in dollars per share) | $ / shares | 3.75 |
| Unvested restricted stock, ending balance (in dollars per share) | $ / shares | $ 3.69 |
Share-Based Compensation - Equity-Classified Compensation Table (Details) - Restricted stock and stock options - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
| Share-based compensation expense | $ 8 | $ 8 | $ 26 | $ 30 |
| General and administrative expenses | ||||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
| Share-based compensation expense | 6 | 7 | 21 | 24 |
| Oil and natural gas properties | ||||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
| Share-based compensation expense | 1 | 0 | 2 | 2 |
| Oil, natural gas and NGL production expenses | ||||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
| Share-based compensation expense | 1 | 1 | 3 | 4 |
| Exploration expenses | ||||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
| Share-based compensation expense | $ 0 | $ 0 | $ 0 | $ 0 |
Derivative and Hedging Activities - Fair Value Level 3 Measurements (Details) - USD ($) $ in Millions |
9 Months Ended | |
|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
|
| Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||
| Derivative assets (liabilities), at fair value, net, beginning of period | $ 282 | |
| Derivative assets (liabilities), at fair value, net, end of period | 323 | |
| Energy related derivative | ||
| Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||
| Derivative assets (liabilities), at fair value, net, beginning of period | 282 | |
| Derivative assets (liabilities), at fair value, net, end of period | 323 | |
| Future Natural Gas Prices | Utica Shale | Energy related derivative | ||
| Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||
| Derivative assets (liabilities), at fair value, net, beginning of period | 7 | |
| Derivative assets (liabilities), at fair value, net, end of period | 0 | |
| Significant Unobservable Inputs (Level 3) | ||
| Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||
| Derivative assets (liabilities), at fair value, net, beginning of period | 94 | |
| Derivative assets (liabilities), at fair value, net, end of period | 32 | |
| Significant Unobservable Inputs (Level 3) | Commodity contract | ||
| Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||
| Derivative assets (liabilities), at fair value, net, beginning of period | 87 | $ (15) |
| Gains (loses) included in earnings | (47) | (3) |
| Settlements | (8) | 13 |
| Derivative assets (liabilities), at fair value, net, end of period | 32 | (5) |
| Significant Unobservable Inputs (Level 3) | Commodity contract | Oil, natural gas and NGL sales | ||
| Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||
| Gains (loses) included in earnings | (47) | (3) |
| Change in unrealized gains (losses) related to assets still held at reporting date | (57) | (3) |
| Significant Unobservable Inputs (Level 3) | Future Natural Gas Prices | Utica Shale | Energy related derivative | ||
| Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||
| Derivative assets (liabilities), at fair value, net, beginning of period | 7 | 0 |
| Gains (loses) included in earnings | (7) | 0 |
| Settlements | 0 | 0 |
| Derivative assets (liabilities), at fair value, net, end of period | 0 | 0 |
| Significant Unobservable Inputs (Level 3) | Future Natural Gas Prices | Utica Shale | Energy related derivative | Oil, natural gas and NGL sales | ||
| Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||
| Gains (loses) included in earnings | (7) | 0 |
| Change in unrealized gains (losses) related to assets still held at reporting date | $ (7) | $ 0 |
Other Operating Expenses - Narrative (Details) - Wildhorse Resource Development Corporation $ in Millions |
9 Months Ended |
|---|---|
|
Sep. 30, 2019
USD ($)
| |
| Business Acquisition [Line Items] | |
| Acquisition related costs | $ 34 |
| Severance expense | $ 38 |
Derivative and Hedging Activities - Derivative Instruments (Details) MMBbls in Millions, $ in Millions, Bcf in Trillions |
9 Months Ended | 12 Months Ended |
|---|---|---|
|
Sep. 30, 2019
USD ($)
Bcf
MMBbls
|
Dec. 31, 2018
USD ($)
Bcf
MMBbls
|
|
| Derivative [Line Items] | ||
| Derivative assets (liabilities), at fair value, net | $ 323 | $ 282 |
| Energy related derivative | ||
| Derivative [Line Items] | ||
| Derivative assets (liabilities), at fair value, net | 323 | 282 |
| Energy related derivative | Future Natural Gas Prices | Utica Shale | ||
| Derivative [Line Items] | ||
| Derivative assets (liabilities), at fair value, net | $ 0 | $ 7 |
| Energy related derivative | Oil | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | MMBbls | 30 | 27 |
| Derivative assets (liabilities), at fair value, net | $ 186 | $ 260 |
| Energy related derivative | Natural Gas | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 625 | 966 |
| Derivative assets (liabilities), at fair value, net | $ 137 | $ 15 |
| Energy related derivative | Fixed-price swaps | Oil | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | MMBbls | 22 | 12 |
| Derivative assets (liabilities), at fair value, net | $ 152 | $ 157 |
| Energy related derivative | Fixed-price swaps | Natural Gas | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 383 | 623 |
| Derivative assets (liabilities), at fair value, net | $ 139 | $ 26 |
| Energy related derivative | Three-way collars | Natural Gas | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 15 | 88 |
| Derivative assets (liabilities), at fair value, net | $ 3 | $ 1 |
| Energy related derivative | Collars | Oil | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | MMBbls | 3 | 8 |
| Derivative assets (liabilities), at fair value, net | $ 33 | $ 98 |
| Energy related derivative | Collars | Natural Gas | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 9 | 55 |
| Derivative assets (liabilities), at fair value, net | $ 3 | $ (3) |
| Energy related derivative | Call options | Natural Gas | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 28 | 44 |
| Derivative assets (liabilities), at fair value, net | $ 0 | $ 0 |
| Energy related derivative | Call swaptions | Oil | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | MMBbls | 2 | |
| Derivative assets (liabilities), at fair value, net | $ (1) | |
| Energy related derivative | Call swaptions | Natural Gas | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 136 | 106 |
| Derivative assets (liabilities), at fair value, net | $ (7) | $ (9) |
| Energy related derivative | Put options | Oil | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | MMBbls | 1 | |
| Derivative assets (liabilities), at fair value, net | $ (2) | |
| Energy related derivative | Basis protection swaps | Oil | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | MMBbls | 2 | 7 |
| Derivative assets (liabilities), at fair value, net | $ 4 | $ 5 |
| Energy related derivative | Basis protection swaps | Natural Gas | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 54 | 50 |
| Derivative assets (liabilities), at fair value, net | $ (1) | $ 0 |
Contingencies and Commitments - Gathering Processing and Transportation Commitments Table (Details) - Gathering, processing and transportation agreement $ in Millions |
Sep. 30, 2019
USD ($)
|
|---|---|
| Other Commitments [Line Items] | |
| Remainder of 2019 | $ 201 |
| 2020 | 764 |
| 2021 | 673 |
| 2022 | 570 |
| 2023 | 480 |
| 2024 – 2035 | 2,731 |
| Total | $ 5,419 |
Debt - Narrative (Details) |
3 Months Ended | 9 Months Ended | |||||||
|---|---|---|---|---|---|---|---|---|---|
|
Feb. 01, 2019
USD ($)
|
Sep. 30, 2019
USD ($)
shares
|
Sep. 30, 2019
USD ($)
|
Sep. 30, 2018
USD ($)
|
Mar. 31, 2021 |
Sep. 30, 2020 |
Jun. 30, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018
USD ($)
|
|
| Long-Term Debt Instrument [Line Items] | |||||||||
| Gain (loss) on purchases or exchanges of debt | $ 70,000,000 | $ (68,000,000) | |||||||
| Chesapeake senior notes | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Gain (loss) on purchases or exchanges of debt | $ 64,000,000 | ||||||||
| Senior notes | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Debt redemption, percent of principal amount of notes to be redeemed | 100.00% | ||||||||
| Debt redemption, percent of aggregate amount of notes to be redeemed | 35.00% | ||||||||
| Repayments of senior debt | 380,000,000 | ||||||||
| Senior notes | Chesapeake senior notes | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Debt instrument, principal amount | $ 507,000,000 | $ 507,000,000 | |||||||
| Conversation of common stock shares outstanding (in shares) | shares | 235,563,519 | ||||||||
| Senior notes | 8.00% senior notes due 2026 | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Debt instrument, principal amount | $ 919,000,000 | $ 919,000,000 | |||||||
| Interest rate, stated percentage | 8.00% | 8.00% | |||||||
| Senior notes | 6.875% senior notes due 2025 | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Debt instrument, principal amount | $ 700,000,000 | ||||||||
| Gain (loss) on purchases or exchanges of debt | $ 6,000,000 | ||||||||
| Interest rate, stated percentage | 6.875% | 6.875% | 6.875% | ||||||
| Debt covenant, basket | $ 25,000,000 | ||||||||
| Debt repurchased, principal | $ 82,000,000 | $ 82,000,000 | |||||||
| Repayment of senior notes | 76,000,000 | ||||||||
| Convertible senior notes | Chesapeake senior notes | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Debt instrument, principal amount | $ 186,000,000 | $ 186,000,000 | |||||||
| Conversation of common stock shares outstanding (in shares) | shares | 73,389,094 | ||||||||
| Convertible senior notes | 8.00% senior notes due 2026 | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Interest rate, stated percentage | 8.00% | 8.00% | |||||||
| Revolving credit facility | Chesapeake revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Line of credit facility, maximum borrowing capacity | $ 3,000,000,000.0 | $ 3,000,000,000.0 | |||||||
| Line of credit facility, maximum borrowing capacity, increased maximum | 4,000,000,000.0 | 4,000,000,000.0 | |||||||
| Letters of credit outstanding, amount | $ 53,000,000 | $ 53,000,000 | |||||||
| Leverage ratio | 4.00 | 5.50 | 5.50 | ||||||
| Leverage ratio, decrease by quarter | 0.0025 | 0.0025 | |||||||
| Line of credit facility, current borrowing capacity | $ 1,443,000,000 | $ 1,443,000,000 | |||||||
| Revolving credit facility | BVL revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Line of credit facility, maximum borrowing capacity | 2,000,000,000.0 | 2,000,000,000.0 | |||||||
| Line of credit facility, current borrowing capacity | $ 1,300,000,000 | $ 1,300,000,000 | |||||||
| Mortgage guarantee, secured percent on proved reserves | 85.00% | 85.00% | |||||||
| Ratio of net debt to EBITDAX | 4.00 | ||||||||
| Ratio of funded debt to EBITDAX | 4.00 | ||||||||
| Current ratio | 1.00 | ||||||||
| Revolving credit facility | Line of credit | Chesapeake revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Debt instrument, principal amount | $ 1,504,000,000 | $ 1,504,000,000 | $ 419,000,000 | ||||||
| Revolving credit facility | Line of credit | BVL revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Debt instrument, principal amount | $ 900,000,000 | $ 900,000,000 | $ 0 | ||||||
| Minimum | Revolving credit facility | BVL revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Commitment fee | 0.375% | ||||||||
| Minimum | Alternative Base Rate (ABR) | Revolving credit facility | Chesapeake revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Variable rate percentage | 0.50% | ||||||||
| Minimum | Alternative Base Rate (ABR) | Revolving credit facility | BVL revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Variable rate percentage | 0.50% | ||||||||
| Minimum | Eurodollar | Revolving credit facility | BVL revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Variable rate percentage | 1.50% | ||||||||
| Minimum | London Interbank Offered Rate (LIBOR) | Revolving credit facility | Chesapeake revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Variable rate percentage | 1.50% | ||||||||
| Minimum | London Interbank Offered Rate (LIBOR) | Revolving credit facility | BVL revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Variable rate percentage | 1.50% | ||||||||
| Maximum | Revolving credit facility | BVL revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Commitment fee | 0.50% | ||||||||
| Maximum | Alternative Base Rate (ABR) | Revolving credit facility | Chesapeake revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Variable rate percentage | 2.00% | ||||||||
| Maximum | Alternative Base Rate (ABR) | Revolving credit facility | BVL revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Variable rate percentage | 1.50% | ||||||||
| Maximum | Eurodollar | Revolving credit facility | BVL revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Variable rate percentage | 2.50% | ||||||||
| Maximum | London Interbank Offered Rate (LIBOR) | Revolving credit facility | Chesapeake revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Variable rate percentage | 3.00% | ||||||||
| Maximum | London Interbank Offered Rate (LIBOR) | Revolving credit facility | BVL revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Variable rate percentage | 2.50% | ||||||||
| Forecast | Revolving credit facility | Chesapeake revolving credit facility | |||||||||
| Long-Term Debt Instrument [Line Items] | |||||||||
| Leverage ratio | 4.00 | ||||||||
| Secured leverage ratio | 2.50 | ||||||||
| Fixed charge coverage ratio | 2.50 | 2.25 | 2.00 | ||||||
Oil and Natural Gas Property Transactions - Purchase Price Allocation (Details) - USD ($) $ / shares in Units, $ in Millions |
Feb. 01, 2019 |
Mar. 31, 2019 |
|---|---|---|
| Fair Value of Assets Acquired: | ||
| Common shares, outstanding (in shares) | 717,376,170 | |
| Share price (in dollars per share) | $ 2.84 | |
| Wildhorse Resource Development Corporation | ||
| Consideration: | ||
| Cash | $ 381 | |
| Fair value of Chesapeake’s common stock issued in the Merger (a) | 2,037 | |
| Total consideration | 2,418 | |
| Fair Value of Liabilities Assumed: | ||
| Current liabilities | 166 | |
| Long-term debt | 1,379 | |
| Deferred tax liabilities | 314 | $ 314 |
| Other long-term liabilities | 36 | |
| Amounts attributable to liabilities assumed | 1,895 | |
| Fair Value of Assets Acquired: | ||
| Cash and cash equivalents | 28 | |
| Other current assets | 128 | |
| Proved oil and natural gas properties | 3,264 | |
| Unproved properties | 756 | |
| Other property and equipment | 77 | |
| Other long-term assets | 60 | |
| Amounts attributable to assets acquired | 4,313 | |
| Total identifiable net assets | $ 2,418 |
Derivative and Hedging Activities (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of estimated fair values of oil, natural gas and NGL derivative instruments | The estimated fair values of our oil, natural gas and NGL derivative instrument assets (liabilities) as of September 30, 2019 and December 31, 2018 are provided below:
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| Schedule of effect of derivative instruments, condensed consolidated balance sheets | The following table presents the fair value and location of each classification of derivative instrument included in the condensed consolidated balance sheets as of September 30, 2019 and December 31, 2018 on a gross basis and after same-counterparty netting:
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| Schedule of effect of derivative instruments, condensed consolidated statements of operations | The components of oil, natural gas and NGL revenues for the Current Quarter, the Prior Quarter, the Current Period and the Prior Period are presented below:
The components of marketing revenues for the Current Quarter, the Prior Quarter, the Current Period and the Prior Period are presented below:
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| Schedule of effect of derivative instruments, accumulated other comprehensive income (loss) | A reconciliation of the changes in accumulated other comprehensive income (loss) in our condensed consolidated statements of stockholders’ equity related to our cash flow hedges is presented below:
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| Schedule of financial assets (liabilities) | The following table provides information for financial assets (liabilities) measured at fair value on a recurring basis as of September 30, 2019 and December 31, 2018:
A summary of the changes in the fair values of our financial assets (liabilities) classified as Level 3 during the Current Period and the Prior Period is presented below:
___________________________________________ The following table provides fair value measurement information for the above-noted financial assets (liabilities) measured at fair value on a recurring basis as of September 30, 2019 and December 31, 2018:
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| Schedule of quantitative information about level 3 inputs used | The following table presents quantitative information about Level 3 inputs used in the fair value measurement of our commodity derivative contracts at fair value as of September 30, 2019:
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Change in Accounting Principle - Statements of Comprehensive Income (Loss) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
||||||||||||
| New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||
| NET INCOME (LOSS) | $ (61) | $ (146) | [1],[2] | $ 16 | $ (377) | [1],[2],[3] | |||||||||
| OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX: | |||||||||||||||
| Unrealized gains on derivative instruments | [4] | 0 | 0 | ||||||||||||
| Unrealized gains on derivative instruments | [1],[4] | 0 | 0 | ||||||||||||
| Reclassification of losses on settled derivative instruments | [4] | 8 | 26 | ||||||||||||
| Reclassification of losses on settled derivative instruments | [1],[4] | 8 | 25 | ||||||||||||
| Other Comprehensive Income | 8 | 8 | [1] | 26 | 25 | [1] | |||||||||
| COMPREHENSIVE INCOME (LOSS) | (53) | (138) | [1] | 42 | (352) | [1] | |||||||||
| COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS | 0 | 0 | [1] | 0 | (1) | [1] | |||||||||
| COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | (53) | (138) | [1] | 42 | (353) | [1] | |||||||||
| Under Full Cost | |||||||||||||||
| New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||
| NET INCOME (LOSS) | 144 | 85 | 634 | 363 | |||||||||||
| OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX: | |||||||||||||||
| Unrealized gains on derivative instruments | [4] | 0 | 0 | ||||||||||||
| Unrealized gains on derivative instruments | [4] | 0 | 0 | ||||||||||||
| Reclassification of losses on settled derivative instruments | 8 | 26 | |||||||||||||
| Reclassification of losses on settled derivative instruments | 8 | 25 | |||||||||||||
| Other Comprehensive Income | 8 | 8 | 26 | 25 | |||||||||||
| COMPREHENSIVE INCOME (LOSS) | 152 | 93 | 660 | 388 | |||||||||||
| COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS | 0 | (1) | (1) | (3) | |||||||||||
| COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | 152 | 92 | 659 | 385 | |||||||||||
| Successful Efforts Adjustment | |||||||||||||||
| New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||
| NET INCOME (LOSS) | (205) | (231) | (618) | (740) | |||||||||||
| OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX: | |||||||||||||||
| Unrealized gains on derivative instruments | [4] | 0 | 0 | ||||||||||||
| Unrealized gains on derivative instruments | [4] | 0 | 0 | ||||||||||||
| Reclassification of losses on settled derivative instruments | 0 | 0 | |||||||||||||
| Reclassification of losses on settled derivative instruments | 0 | 0 | |||||||||||||
| Other Comprehensive Income | 0 | 0 | 0 | 0 | |||||||||||
| COMPREHENSIVE INCOME (LOSS) | (205) | (231) | (618) | (740) | |||||||||||
| COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS | 0 | 1 | 1 | 2 | |||||||||||
| COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | $ (205) | $ (230) | $ (617) | $ (738) | |||||||||||
| |||||||||||||||
Income Taxes - Narrative (Details) - USD ($) |
3 Months Ended | 9 Months Ended | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Mar. 31, 2019 |
Sep. 30, 2018 |
[1] | Sep. 30, 2019 |
Sep. 30, 2018 |
[1] | Feb. 01, 2019 |
|||
| Business Acquisition [Line Items] | ||||||||||
| Effective income tax rate | 0.00% | |||||||||
| Income tax benefit | $ 1,000,000 | $ (1,000,000) | $ 315,000,000 | $ 8,000,000 | ||||||
| Ownership change, cumulative shift | 40.00% | |||||||||
| Wildhorse Resource Development Corporation | ||||||||||
| Business Acquisition [Line Items] | ||||||||||
| Deferred tax liabilities | $ 314,000,000 | $ 314,000,000 | ||||||||
| Income tax benefit | 1,000,000 | 314,000,000 | $ 315,000,000 | |||||||
| Deferred tax liability, plant, property and equipment and prepaid compensation | 401,000,000 | |||||||||
| Deferred tax assets, operating loss carryforward, limitations | $ 61,000,000 | 61,000,000 | ||||||||
| Wildhorse Resource Development Corporation | Federal | ||||||||||
| Business Acquisition [Line Items] | ||||||||||
| Deferred tax asset, operating loss carryforward | $ 87,000,000 | |||||||||
| Wildhorse Resource Development Corporation | State | ||||||||||
| Business Acquisition [Line Items] | ||||||||||
| Income tax benefit | $ 314,000,000 | |||||||||
| ||||||||||
Leases - Maturity Analysis of Finance and Operating Lease Liabilities (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| Finance Leases, After Adoption of 842: | ||
| Remainder of 2019 | $ 3 | |
| 2020 | 10 | |
| 2021 | 10 | |
| 2022 | 0 | |
| 2023 | 0 | |
| Thereafter | 0 | |
| Total lease payments | 23 | |
| Less imputed interest | (3) | |
| Financing, present value of lease liabilities | 20 | |
| Less current maturities | (9) | |
| Present value of lease liabilities, less current maturities | 11 | |
| Operating Leases, After Adoption of 842: | ||
| Remainder of 2019 | 2 | |
| 2020 | 9 | |
| 2021 | 5 | |
| 2022 | 3 | |
| 2023 | 2 | |
| Thereafter | 7 | |
| Total lease payments | 28 | |
| Less imputed interest | (3) | |
| Operating, present value of lease liabilities | 25 | |
| Less current maturities | (9) | |
| Present value of lease liabilities, less current maturities | $ 16 | |
| Capital Leases, Before Adoption of 842: | ||
| 2019 | $ 10 | |
| 2020 | 10 | |
| 2021 | 10 | |
| Total minimum lease payments | 30 | |
| Operating Leases, After Adoption of 842: | ||
| 2019 | 3 | |
| 2020 | 1 | |
| 2021 | 0 | |
| Total minimum lease payments | $ 4 |
Condensed Consolidating Financial Information - Statement of Operations (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | $ 2,087 | $ 2,424 | [1] | $ 6,669 | $ 7,237 | [1] | ||||||
| Gains on sales of assets | 13 | (10) | [1] | 33 | 27 | [1],[2] | ||||||
| OPERATING EXPENSES: | ||||||||||||
| Production taxes | 35 | 34 | [1] | 109 | 91 | [1] | ||||||
| General and administrative | 66 | 81 | [1] | 258 | 273 | [1] | ||||||
| Restructuring and other termination costs | 0 | 0 | [1] | 0 | 38 | [1] | ||||||
| Provision for legal contingencies, net | 0 | 8 | [1] | 3 | 17 | [1] | ||||||
| Depreciation, depletion and amortization | 573 | 405 | [1] | 1,672 | 1,335 | [1],[2] | ||||||
| Impairments | 9 | 58 | [1] | 11 | 122 | [1],[2] | ||||||
| Other operating (income) expense | 15 | 0 | [1] | 79 | (1) | [1] | ||||||
| Total Operating Expenses | 2,041 | 2,342 | [1] | 6,527 | 7,273 | [1] | ||||||
| INCOME (LOSS) FROM OPERATIONS | 46 | 82 | [1] | 142 | (36) | [1] | ||||||
| OTHER INCOME (EXPENSE): | ||||||||||||
| Interest expense | (177) | (165) | [1] | (513) | (482) | [1] | ||||||
| Gains (losses) on investments | (4) | 0 | [1] | (28) | 139 | [1] | ||||||
| Gains (losses) on purchases or exchanges of debt | 70 | (68) | [1] | 70 | (68) | [1] | ||||||
| Other income | 3 | 6 | [1] | 30 | 62 | [1] | ||||||
| Equity in net earnings of subsidiary | 0 | 0 | 0 | 0 | ||||||||
| Total Other Expense | (108) | (227) | [1] | (441) | (349) | [1] | ||||||
| LOSS BEFORE INCOME TAXES | (62) | (145) | [1] | (299) | (385) | [1] | ||||||
| INCOME TAX (BENEFIT) EXPENSE | (1) | 1 | [1] | (315) | (8) | [1] | ||||||
| NET INCOME (LOSS) | (61) | (146) | [1],[3] | 16 | (377) | [1],[2],[3] | ||||||
| Net income attributable to noncontrolling interests | 0 | 0 | [1],[3] | 0 | (1) | [1],[3] | ||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | (61) | (146) | [1] | 16 | (378) | [1] | ||||||
| Other comprehensive income | 8 | 8 | [3] | 26 | 25 | [3] | ||||||
| COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | (53) | (138) | [3] | 42 | (353) | [3] | ||||||
| Eliminations | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| Gains on sales of assets | 0 | 0 | 0 | 0 | ||||||||
| OPERATING EXPENSES: | ||||||||||||
| Production taxes | 0 | 0 | 0 | 0 | ||||||||
| General and administrative | 0 | 0 | 0 | 0 | ||||||||
| Restructuring and other termination costs | 0 | |||||||||||
| Provision for legal contingencies, net | 0 | 0 | 0 | |||||||||
| Depreciation, depletion and amortization | 0 | 0 | 0 | 0 | ||||||||
| Impairments | 0 | 0 | 0 | 0 | ||||||||
| Other operating (income) expense | 0 | 0 | 0 | |||||||||
| Total Operating Expenses | 0 | 0 | 0 | 0 | ||||||||
| INCOME (LOSS) FROM OPERATIONS | 0 | 0 | 0 | 0 | ||||||||
| OTHER INCOME (EXPENSE): | ||||||||||||
| Interest expense | 0 | 0 | 0 | 0 | ||||||||
| Gains (losses) on investments | 0 | 0 | 0 | |||||||||
| Gains (losses) on purchases or exchanges of debt | 0 | 0 | 0 | 0 | ||||||||
| Other income | 0 | 0 | 0 | 0 | ||||||||
| Equity in net earnings of subsidiary | (27) | (86) | (41) | (162) | ||||||||
| Total Other Expense | (27) | (86) | (41) | (162) | ||||||||
| LOSS BEFORE INCOME TAXES | (27) | (86) | (41) | (162) | ||||||||
| INCOME TAX (BENEFIT) EXPENSE | 0 | 0 | 0 | 0 | ||||||||
| NET INCOME (LOSS) | (27) | (86) | (41) | (162) | ||||||||
| Net income attributable to noncontrolling interests | 0 | 0 | 0 | 0 | ||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | (27) | (86) | (41) | (162) | ||||||||
| Other comprehensive income | 0 | 0 | 0 | 0 | ||||||||
| COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | (27) | (86) | (41) | (162) | ||||||||
| Parent | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| Gains on sales of assets | 0 | 0 | 0 | 0 | ||||||||
| OPERATING EXPENSES: | ||||||||||||
| Production taxes | 0 | 0 | 0 | 0 | ||||||||
| General and administrative | 0 | 0 | 0 | 0 | ||||||||
| Restructuring and other termination costs | 0 | |||||||||||
| Provision for legal contingencies, net | 0 | 0 | 0 | |||||||||
| Depreciation, depletion and amortization | 0 | 0 | 0 | 0 | ||||||||
| Impairments | 0 | 0 | 0 | 0 | ||||||||
| Other operating (income) expense | 0 | 0 | 0 | |||||||||
| Total Operating Expenses | 0 | 0 | 0 | 0 | ||||||||
| INCOME (LOSS) FROM OPERATIONS | 0 | 0 | 0 | 0 | ||||||||
| OTHER INCOME (EXPENSE): | ||||||||||||
| Interest expense | (161) | (163) | (475) | (480) | ||||||||
| Gains (losses) on investments | 0 | 0 | 0 | |||||||||
| Gains (losses) on purchases or exchanges of debt | 64 | (68) | 64 | (68) | ||||||||
| Other income | 0 | 0 | 0 | 0 | ||||||||
| Equity in net earnings of subsidiary | 25 | 86 | 129 | 162 | ||||||||
| Total Other Expense | (72) | (145) | (282) | (386) | ||||||||
| LOSS BEFORE INCOME TAXES | (72) | (145) | (282) | (386) | ||||||||
| INCOME TAX (BENEFIT) EXPENSE | (11) | 1 | (298) | (8) | ||||||||
| NET INCOME (LOSS) | (61) | (146) | 16 | (378) | ||||||||
| Net income attributable to noncontrolling interests | 0 | 0 | 0 | 0 | ||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | (61) | (146) | 16 | (378) | ||||||||
| Other comprehensive income | 0 | 0 | 0 | 0 | ||||||||
| COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | (61) | (146) | 16 | (378) | ||||||||
| Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 1,849 | 2,419 | 6,116 | 7,223 | ||||||||
| Gains on sales of assets | 13 | (10) | 33 | 27 | ||||||||
| OPERATING EXPENSES: | ||||||||||||
| Production taxes | 25 | 33 | 83 | 90 | ||||||||
| General and administrative | 43 | 81 | 193 | 272 | ||||||||
| Restructuring and other termination costs | 38 | |||||||||||
| Provision for legal contingencies, net | 8 | 3 | 17 | |||||||||
| Depreciation, depletion and amortization | 421 | 403 | 1,295 | 1,330 | ||||||||
| Impairments | 9 | 58 | 11 | 122 | ||||||||
| Other operating (income) expense | 15 | 41 | (1) | |||||||||
| Total Operating Expenses | 1,828 | 2,337 | 5,936 | 7,261 | ||||||||
| INCOME (LOSS) FROM OPERATIONS | 21 | 82 | 180 | (38) | ||||||||
| OTHER INCOME (EXPENSE): | ||||||||||||
| Interest expense | 3 | (2) | 13 | (2) | ||||||||
| Gains (losses) on investments | (4) | (4) | 139 | |||||||||
| Gains (losses) on purchases or exchanges of debt | 0 | 0 | 0 | 0 | ||||||||
| Other income | 3 | 6 | 28 | 62 | ||||||||
| Equity in net earnings of subsidiary | 2 | 0 | (88) | 1 | ||||||||
| Total Other Expense | 4 | 4 | (51) | 200 | ||||||||
| LOSS BEFORE INCOME TAXES | 25 | 86 | 129 | 162 | ||||||||
| INCOME TAX (BENEFIT) EXPENSE | 0 | 0 | 0 | 0 | ||||||||
| NET INCOME (LOSS) | 25 | 86 | 129 | 162 | ||||||||
| Net income attributable to noncontrolling interests | 0 | 0 | 0 | (1) | ||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | 25 | 86 | 129 | 161 | ||||||||
| Other comprehensive income | 8 | 8 | 26 | 25 | ||||||||
| COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | 33 | 94 | 155 | 186 | ||||||||
| Non-Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 238 | 5 | 553 | 14 | ||||||||
| Gains on sales of assets | 0 | 0 | 0 | 0 | ||||||||
| OPERATING EXPENSES: | ||||||||||||
| Production taxes | 10 | 1 | 26 | 1 | ||||||||
| General and administrative | 23 | 0 | 65 | 1 | ||||||||
| Restructuring and other termination costs | 0 | |||||||||||
| Provision for legal contingencies, net | 0 | 0 | 0 | |||||||||
| Depreciation, depletion and amortization | 152 | 2 | 377 | 5 | ||||||||
| Impairments | 0 | 0 | 0 | 0 | ||||||||
| Other operating (income) expense | 0 | 38 | 0 | |||||||||
| Total Operating Expenses | 213 | 5 | 591 | 12 | ||||||||
| INCOME (LOSS) FROM OPERATIONS | 25 | 0 | (38) | 2 | ||||||||
| OTHER INCOME (EXPENSE): | ||||||||||||
| Interest expense | (19) | 0 | (51) | 0 | ||||||||
| Gains (losses) on investments | 0 | (24) | 0 | |||||||||
| Gains (losses) on purchases or exchanges of debt | 6 | 0 | 6 | 0 | ||||||||
| Other income | 0 | 0 | 2 | 0 | ||||||||
| Equity in net earnings of subsidiary | 0 | 0 | 0 | (1) | ||||||||
| Total Other Expense | (13) | 0 | (67) | (1) | ||||||||
| LOSS BEFORE INCOME TAXES | 12 | 0 | (105) | 1 | ||||||||
| INCOME TAX (BENEFIT) EXPENSE | 10 | 0 | (17) | 0 | ||||||||
| NET INCOME (LOSS) | 2 | 0 | (88) | 1 | ||||||||
| Net income attributable to noncontrolling interests | 0 | 0 | 0 | 0 | ||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | 2 | 0 | (88) | 1 | ||||||||
| Other comprehensive income | 0 | 0 | 0 | 0 | ||||||||
| COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | 2 | 0 | (88) | 1 | ||||||||
| Oil, natural gas and NGL | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 1,170 | 1,199 | [1] | 3,553 | 3,424 | [1] | ||||||
| Oil, natural gas and NGL | Eliminations | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| Oil, natural gas and NGL | Parent | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| Oil, natural gas and NGL | Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 932 | 1,194 | 3,000 | 3,410 | ||||||||
| Oil, natural gas and NGL | Non-Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 238 | 5 | 553 | 14 | ||||||||
| Marketing | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 889 | 1,219 | [1] | 3,038 | 3,738 | [1] | ||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 901 | 1,238 | [1] | 3,071 | 3,798 | [1] | ||||||
| Marketing | Eliminations | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 0 | 0 | 0 | 0 | ||||||||
| Marketing | Parent | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 0 | 0 | 0 | 0 | ||||||||
| Marketing | Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 889 | 1,219 | 3,038 | 3,738 | ||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 901 | 1,238 | 3,071 | 3,798 | ||||||||
| Marketing | Non-Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 0 | 0 | 0 | 0 | ||||||||
| Oil, natural gas and NGL and Marketing | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 2,059 | 2,418 | [1] | 6,591 | 7,162 | [1] | ||||||
| Oil, natural gas and NGL and Marketing | Eliminations | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| Oil, natural gas and NGL and Marketing | Parent | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| Oil, natural gas and NGL and Marketing | Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 1,821 | 2,413 | 6,038 | 7,148 | ||||||||
| Oil, natural gas and NGL and Marketing | Non-Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 238 | 5 | 553 | 14 | ||||||||
| Other | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 15 | 16 | [1] | 45 | 48 | [1] | ||||||
| Other | Eliminations | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| Other | Parent | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| Other | Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 15 | 16 | 45 | 48 | ||||||||
| Other | Non-Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 0 | 0 | 0 | 0 | ||||||||
| Oil, natural gas and NGL production | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 155 | 132 | [1] | 453 | 417 | [1] | ||||||
| Oil, natural gas and NGL production | Eliminations | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 0 | 0 | 0 | 0 | ||||||||
| Oil, natural gas and NGL production | Parent | Reportable legal entities | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 0 | 0 | 0 | 0 | ||||||||
| Oil, natural gas and NGL production | Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 129 | 132 | 384 | 417 | ||||||||
| Oil, natural gas and NGL production | Non-Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 26 | 0 | 69 | 0 | ||||||||
| Oil, natural gas and NGL gathering, processing and transportation | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 270 | 364 | [1] | 815 | 1,060 | [1] | ||||||
| Oil, natural gas and NGL gathering, processing and transportation | Eliminations | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 0 | 0 | 0 | 0 | ||||||||
| Oil, natural gas and NGL gathering, processing and transportation | Parent | Reportable legal entities | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 0 | 0 | 0 | 0 | ||||||||
| Oil, natural gas and NGL gathering, processing and transportation | Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 268 | 362 | 802 | 1,055 | ||||||||
| Oil, natural gas and NGL gathering, processing and transportation | Non-Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 2 | 2 | 13 | 5 | ||||||||
| Exploration | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 17 | 22 | [1] | 56 | 123 | [1] | ||||||
| Exploration | Eliminations | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 0 | 0 | 0 | 0 | ||||||||
| Exploration | Parent | Reportable legal entities | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 0 | 0 | 0 | 0 | ||||||||
| Exploration | Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 17 | 22 | 53 | 123 | ||||||||
| Exploration | Non-Guarantor Subsidiaries | Reportable legal entities | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | $ 0 | $ 0 | $ 3 | $ 0 | ||||||||
| ||||||||||||
Restructuring and Other Termination Costs |
9 Months Ended |
|---|---|
Sep. 30, 2019 | |
| Restructuring and Related Activities [Abstract] | |
| Restructuring and Other Termination Costs | Restructuring and Other Termination Costs On January 30, 2018, we underwent a reduction in workforce impacting approximately 13% of employees across all functions, primarily on our Oklahoma City campus. In connection with the reduction, we incurred a total charge in the Prior Period of approximately $38 million for one-time termination benefits.
|
Share-Based Compensation |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-Based Compensation | Share-Based Compensation Our share-based compensation program consists of restricted stock, stock options, performance share units (PSUs) and cash restricted stock units (CRSUs) granted to employees and restricted stock granted to non-employee directors under our long-term incentive plans. The restricted stock and stock options are equity-classified awards and the PSUs and CRSUs are liability-classified awards. Equity-Classified Awards Restricted Stock. We grant restricted stock units to employees and non-employee directors. A summary of the changes in unvested restricted stock during the Current Period is presented below:
The aggregate intrinsic value of restricted stock that vested during the Current Period was approximately $15 million based on the stock price at the time of vesting. As of September 30, 2019, there was approximately $24 million of total unrecognized compensation expense related to unvested restricted stock. The expense is expected to be recognized over a weighted average period of approximately 1.92 years. Stock Options. In the Current Period and the Prior Period, we granted members of management stock options that vest ratably over a three-year period. Each stock option award has an exercise price equal to the closing price of our common stock on the grant date. Outstanding options expire seven years to ten years from the date of grant. We utilize the Black-Scholes option pricing model to measure the fair value of stock options. The expected life of an option is determined using the simplified method. Volatility assumptions are estimated based on the average historical volatility of Chesapeake stock over the expected life of an option. The risk-free interest rate is based on the U.S. Treasury rate in effect at the time of the grant over the expected life of the option. The dividend yield is based on an annual dividend yield, taking into account our dividend policy, over the expected life of the option. We used the following weighted average assumptions to estimate the grant date fair value of the stock options granted in the Current Period:
The following table provides information related to stock option activity in the Current Period:
___________________________________________
As of September 30, 2019, there was $7 million of total unrecognized compensation expense related to stock options. The expense is expected to be recognized over a weighted average period of approximately 1.26 years, net of actual forfeitures. Restricted Stock and Stock Option Compensation. We recognized the following compensation costs related to restricted stock and stock options for the Current Quarter, the Prior Quarter, the Current Period and the Prior Period:
Liability-Classified Awards Performance Share Units. In the Current Period and the Prior Period, we granted PSUs to senior management that vest ratably over a three-year performance period and are settled in cash. The ultimate amount earned is based on achievement of performance metrics established by the Compensation Committee of the Board of Directors. Compensation expense associated with PSU awards is recognized over the service period based on the graded-vesting method. The value of the PSU awards at the end of each reporting period is dependent upon our estimates of the underlying performance measures. For PSUs granted in 2017, performance metrics include a total shareholder return (TSR) component, which can range from 0% to 100% and an operational performance component based on finding and development costs, which can range from 0% to 100%, resulting in a maximum payout of 200%. The payout percentage for the 2017 PSU awards is capped at 100% if our absolute TSR is less than zero. The PSUs are settled in cash on the third anniversary of the awards. We utilized a Monte Carlo simulation for the TSR performance measure and the following assumptions to determine the grant date fair value and the reporting date fair value of the 2017 awards.
As the above assumptions and expected satisfaction of performance metrics change, the PSU liabilities will be adjusted quarterly through the end of the performance period. For PSUs granted in 2018 and 2019, performance metrics include an operational performance component based on a ratio of cumulative earnings before interest expense, income taxes, and depreciation, depletion and amortization expense (EBITDA) to capital expenditures, for which payout can range from 0% to 200%. For the 2019 award, EBITDA and capital expenditures will be adjusted for changes resulting from our conversion from the full cost method of accounting to the successful efforts method. The vested PSUs are settled in cash on each of the three annual vesting dates. We used the closing price of our common stock on the grant date to determine the grant date fair value of the PSUs. The PSU liability will be adjusted quarterly, based on changes in our stock price and expected satisfaction of performance metrics, through the end of the performance period. Cash Restricted Stock Units. In 2018, we granted CRSUs to employees that vest straight-line over a three-year period and are settled in cash on each of the three annual vesting dates. The ultimate amount earned is based on the closing price of our common stock on each of the vesting dates. We used the closing price of our common stock on the grant date to determine the grant date fair value of the CRSUs. The CRSU liability will be adjusted quarterly, based on changes in our stock price, through the end of the vesting period. The following table presents a summary of our liability-classified awards:
We recognized the following compensation costs, net of actual forfeitures, related to our liability-classified awards for the Current Quarter, the Prior Quarter, the Current Period and the Prior Period.
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Change in Accounting Principle (Tables) |
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| Accounting Changes and Error Corrections [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of changes in accounting principles |
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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) (Parenthetical) - shares |
3 Months Ended | 9 Months Ended | ||
|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
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| PREFERRED STOCK | ||||
| Preferred stock exchanges (in shares) | 40,000 | 0 | 40,000 | 0 |
| TREASURY STOCK – COMMON: | ||||
| Purchase of shares for company benefit plans (in shares) | 53,337 | 30,509 | 2,673,903 | 1,499,033 |
| Release of shares from company benefit plans (in shares) | 37,301 | 41,617 | 296,864 | 431,474 |
| Exchange of preferred stock for shares of common stock | ADDITIONAL PAID-IN CAPITAL: | ||||
| Preferred stock exchanges (in shares) | 10,367,950 | 0 | 10,367,950 | 0 |
| Exchange of senior notes for shares of common stock | ADDITIONAL PAID-IN CAPITAL: | ||||
| Preferred stock exchanges (in shares) | 235,563,519 | 0 | 235,563,519 | 0 |
| Exchange of convertible senior notes for common stock | ADDITIONAL PAID-IN CAPITAL: | ||||
| Preferred stock exchanges (in shares) | 73,389,094 | 0 | 73,389,094 | 0 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Millions, $ in Millions |
3 Months Ended | 9 Months Ended | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
[1] | Sep. 30, 2019 |
Sep. 30, 2018 |
[1] | |||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | $ 2,087 | $ 2,424 | $ 6,669 | $ 7,237 | ||||||||
| Gains (losses) on sales of assets | 13 | (10) | 33 | 27 | [2] | |||||||
| OPERATING EXPENSES: | ||||||||||||
| Production taxes | 35 | 34 | 109 | 91 | ||||||||
| General and administrative | 66 | 81 | 258 | 273 | ||||||||
| Restructuring and other termination costs | 0 | 0 | 0 | 38 | ||||||||
| Provision for legal contingencies, net | 0 | 8 | 3 | 17 | ||||||||
| Depreciation, depletion and amortization | 573 | 405 | 1,672 | 1,335 | [2] | |||||||
| Impairments | 9 | 58 | 11 | 122 | [2] | |||||||
| Other operating (income) expense | 15 | 0 | 79 | (1) | ||||||||
| Total Operating Expenses | 2,041 | 2,342 | 6,527 | 7,273 | ||||||||
| INCOME (LOSS) FROM OPERATIONS | 46 | 82 | 142 | (36) | ||||||||
| OTHER INCOME (EXPENSE): | ||||||||||||
| Interest expense | (177) | (165) | (513) | (482) | ||||||||
| Gains (losses) on investments | (4) | 0 | (28) | 139 | ||||||||
| Gains (losses) on purchases or exchanges of debt | 70 | (68) | 70 | (68) | ||||||||
| Other income | 3 | 6 | 30 | 62 | ||||||||
| Total Other Expense | (108) | (227) | (441) | (349) | ||||||||
| LOSS BEFORE INCOME TAXES | (62) | (145) | (299) | (385) | ||||||||
| Income tax expense (benefit) | (1) | 1 | (315) | (8) | ||||||||
| NET INCOME (LOSS) | (61) | (146) | [3] | 16 | (377) | [2],[3] | ||||||
| Net income attributable to noncontrolling interests | 0 | 0 | [3] | 0 | (1) | [3] | ||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | (61) | (146) | 16 | (378) | ||||||||
| Preferred stock dividends | (23) | (23) | (69) | (69) | ||||||||
| Loss on exchange of preferred stock | (17) | 0 | (17) | 0 | ||||||||
| NET LOSS AVAILABLE TO COMMON STOCKHOLDERS | $ (101) | $ (169) | $ (70) | $ (447) | ||||||||
| LOSS PER COMMON SHARE: | ||||||||||||
| Basic (in dollars per share) | $ (0.06) | $ (0.19) | $ (0.04) | $ (0.49) | ||||||||
| Diluted (in dollars per share) | $ (0.06) | $ (0.19) | $ (0.04) | $ (0.49) | ||||||||
| WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions): | ||||||||||||
| Basic (in shares) | 1,698 | 910 | 1,570 | 909 | ||||||||
| Diluted (in shares) | 1,698 | 910 | 1,570 | 909 | ||||||||
| Oil, natural gas and NGL | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | $ 1,170 | $ 1,199 | $ 3,553 | $ 3,424 | ||||||||
| Marketing | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 889 | 1,219 | 3,038 | 3,738 | ||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 901 | 1,238 | 3,071 | 3,798 | ||||||||
| Oil, natural gas and NGL and Marketing | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 2,059 | 2,418 | 6,591 | 7,162 | ||||||||
| Other | ||||||||||||
| REVENUES AND OTHER: | ||||||||||||
| Revenues | 15 | 16 | 45 | 48 | ||||||||
| Oil, natural gas and NGL production | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 155 | 132 | 453 | 417 | ||||||||
| Oil, natural gas and NGL gathering, processing and transportation | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | 270 | 364 | 815 | 1,060 | ||||||||
| Exploration | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||
| Expense | $ 17 | $ 22 | $ 56 | $ 123 | ||||||||
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Leases |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Leases | Leases We are a lessee under various agreements for compressors, office space, vehicles and other equipment. As of September 30, 2019, these leases have remaining terms ranging from one month to 7.3 years. Certain of our lease agreements include options to renew the lease, terminate the lease early or purchase the underlying asset at the end of the lease. We determine the lease term at the lease commencement date as the non-cancelable period of the lease, including options to extend or terminate the lease when we are reasonably certain to exercise the option. The company’s vehicles are the only leases with renewal options that we are reasonably certain to exercise. The renewals are reflected in the ROU asset and lease liability balances. Upon adoption of ASC 842 on January 1, 2019, we recognized a nominal operating lease liability and a nominal related ROU asset related to vehicles we lease. On February 1, 2019, we acquired WildHorse and, as part of the purchase price allocation, we recognized additional operating lease liabilities of $40 million, a related ROU asset of $38 million, and lease incentives of $2 million related to two office space leases, a long-term hydraulic fracturing agreement and other equipment leases. Regarding our long-term hydraulic fracturing agreements, we made a policy election to treat both lease and non-lease components as a single lease component. In 2018, we sold our wholly owned subsidiary, Midcon Compression, L.L.C., to a third party and subsequently leased back some natural gas compressors for 38 months. The lease is accounted for as a finance lease liability. The following table presents our ROU assets and lease liabilities as of September 30, 2019.
Additional information for the Company’s operating and finance leases is presented below:
____________________________________________
Maturity analysis of finance lease liabilities and operating lease liabilities are presented below:
The aggregate undiscounted minimum future lease payments under previous lease accounting standard, ASC 840, are presented below:
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| Leases | Leases We are a lessee under various agreements for compressors, office space, vehicles and other equipment. As of September 30, 2019, these leases have remaining terms ranging from one month to 7.3 years. Certain of our lease agreements include options to renew the lease, terminate the lease early or purchase the underlying asset at the end of the lease. We determine the lease term at the lease commencement date as the non-cancelable period of the lease, including options to extend or terminate the lease when we are reasonably certain to exercise the option. The company’s vehicles are the only leases with renewal options that we are reasonably certain to exercise. The renewals are reflected in the ROU asset and lease liability balances. Upon adoption of ASC 842 on January 1, 2019, we recognized a nominal operating lease liability and a nominal related ROU asset related to vehicles we lease. On February 1, 2019, we acquired WildHorse and, as part of the purchase price allocation, we recognized additional operating lease liabilities of $40 million, a related ROU asset of $38 million, and lease incentives of $2 million related to two office space leases, a long-term hydraulic fracturing agreement and other equipment leases. Regarding our long-term hydraulic fracturing agreements, we made a policy election to treat both lease and non-lease components as a single lease component. In 2018, we sold our wholly owned subsidiary, Midcon Compression, L.L.C., to a third party and subsequently leased back some natural gas compressors for 38 months. The lease is accounted for as a finance lease liability. The following table presents our ROU assets and lease liabilities as of September 30, 2019.
Additional information for the Company’s operating and finance leases is presented below:
____________________________________________
Maturity analysis of finance lease liabilities and operating lease liabilities are presented below:
The aggregate undiscounted minimum future lease payments under previous lease accounting standard, ASC 840, are presented below:
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Earnings Per Share |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Earnings Per Share, Basic and Diluted, Other Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Earnings Per Share | Earnings Per Share Basic earnings per share (EPS) is calculated using the weighted average number of common shares outstanding during the period and includes the effect of any participating securities as appropriate. Participating securities consist of unvested restricted stock issued to our employees and non-employee directors that provide dividend rights. Diluted EPS is calculated assuming the issuance of common shares for all potentially dilutive securities, provided the effect is not antidilutive. For all periods presented, our convertible senior notes did not have a dilutive effect and, therefore, were excluded from the calculation of diluted EPS. Shares of common stock for the following securities were excluded from the calculation of diluted EPS as the effect was antidilutive:
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Equity (Tables) |
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| Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Summary of changes in common shares issued | A summary of the changes in our common shares issued is detailed below.
____________________________________________
(d)
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| Summary of changes in preferred stock outstanding | A summary of the changes in our outstanding shares of preferred stock is detailed below.
____________________________________________ (a) See discussion above regarding the exchange of our 5.75% (Series A) Cumulative Convertible Preferred Stock in the Current Quarter.
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Oil and Natural Gas Property Transactions (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of preliminary allocation of the total purchase price | The following table represents the preliminary allocation of the total purchase price of WildHorse to the identifiable assets acquired and the liabilities assumed based on the fair values as of the acquisition date. Certain data necessary to complete the purchase price allocation is not yet available, and includes, but is not limited to, valuation of pre-acquisition contingencies and final appraisals of assets acquired and liabilities assumed. We expect to complete the purchase price allocation during the 12-month period following the acquisition date, during which time the value of the assets and liabilities may be revised as appropriate.
___________________________________________ (a) Based on 717,376,170 Chesapeake common shares issued at closing at $2.84 per share (closing price as of February 1, 2019).
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| Schedule of pro forma financial information | The following unaudited pro forma financial information for the nine months ended September 30, 2019 and three and nine months ended September 30, 2018, respectively, is based on our historical consolidated financial statements adjusted to reflect as if the WildHorse acquisition had occurred on January 1, 2018. The information below reflects pro forma adjustments based on available information and certain assumptions that we believe are reasonable, including adjustments to conform the classification of expenses in WildHorse’s statements of operations to our classification for similar expenses and the estimated tax impact of pro forma adjustments.
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Contingencies and Commitments (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of contractual obligation | The aggregate undiscounted commitments under our gathering, processing and transportation agreements, excluding any reimbursement from working interest and royalty interest owners, credits for third-party volumes or future costs under cost-of-service agreements, are presented below:
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- Fair Value of Debt Table (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Long-term debt, fair value | $ 9,524 | $ 7,787 |
| Quoted Prices in Active Markets (Level 1) | Carrying Amount | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Short-term debt, fair value | 208 | 381 |
| Long-term debt, fair value | 2,790 | 3,495 |
| Quoted Prices in Active Markets (Level 1) | Estimated Fair Value | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Short-term debt, fair value | 208 | 379 |
| Long-term debt, fair value | 2,245 | 3,173 |
| Significant Other Observable Inputs (Level 2) | Carrying Amount | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Long-term debt, fair value | 6,343 | 3,846 |
| Significant Other Observable Inputs (Level 2) | Estimated Fair Value | ||
| Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
| Long-term debt, fair value | $ 4,980 | $ 3,644 |
Earnings Per Share - Antidilutive Securities Excluded from Computation of EPS Table (Details) - shares shares in Millions |
3 Months Ended | 9 Months Ended | ||
|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
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| Common stock equivalent of our preferred stock outstanding prior to exchange | ||||
| Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
| Shares of common stock that were excluded from the calculation of diluted EPS (in shares) | 1 | 0 | 1 | 0 |
| Common stock equivalent of our convertible senior notes outstanding | ||||
| Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
| Shares of common stock that were excluded from the calculation of diluted EPS (in shares) | 124 | 146 | 124 | 146 |
| Participating securities | ||||
| Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
| Shares of common stock that were excluded from the calculation of diluted EPS (in shares) | 0 | 2 | 0 | 1 |
| Common stock equivalent of our preferred stock outstanding | ||||
| Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
| Shares of common stock that were excluded from the calculation of diluted EPS (in shares) | 58 | 60 | 58 | 60 |
Other Liabilities - Long-Term Table (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| Other Liabilities Disclosure [Abstract] | ||
| VPP deferred revenue | $ 22 | $ 63 |
| Unrecognized tax benefits | 55 | 53 |
| Other | 109 | 103 |
| Total other long-term liabilities | $ 186 | $ 219 |
Derivative and Hedging Activities - Cash Flow Hedges Components of AOCI (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||||
|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
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| AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||
| AOCI, after tax, beginning of period | $ (23) | ||||||||
| Losses reclassified to income, after tax | [1] | $ 8 | 26 | ||||||
| Losses reclassified to income, after tax | [1],[2] | $ 8 | $ 25 | ||||||
| AOCI, after tax, end of period | 3 | 3 | |||||||
| Cash flow hedging | |||||||||
| AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||
| AOCI, before tax, beginning of period | (62) | (97) | (80) | (114) | |||||
| AOCI, after tax, beginning of period | (5) | (40) | (23) | (57) | |||||
| Losses reclassified to income, before tax | 8 | 26 | |||||||
| Losses reclassified to income, after tax | 8 | 26 | |||||||
| Losses reclassified to income, before tax | 8 | 25 | |||||||
| Losses reclassified to income, after tax | 8 | 25 | |||||||
| AOCI, before tax, end of period | (54) | (89) | (54) | (89) | |||||
| AOCI, after tax, end of period | $ 3 | $ (32) | $ 3 | $ (32) | |||||
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Share-Based Compensation - Equity-Classified Valuation Table (Details) - Stock option |
9 Months Ended |
|---|---|
Sep. 30, 2019 | |
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
| Expected option life – years | 6 years |
| Volatility | 65.61% |
| Risk-free interest rate | 2.47% |
| Dividend yield | 0.00% |
Share-Based Compensation - Performance Share Unit Breakout (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| Performance Share Units | Award Year 2019, Payable 2020, 2021 and 2022 | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Units | 4,785,372 | |
| Fair Value | $ 7 | $ 14 |
| Vested Liability | $ 0 | |
| Performance Share Units | Award Year 2018, Payable 2020 and 2021 | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Units | 2,388,185 | |
| Fair Value | $ 3 | 7 |
| Vested Liability | $ 0 | |
| Performance Share Units | Award Year 2017, Payable 2020 | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Units | 1,174,973 | |
| Fair Value | $ 1 | 8 |
| Vested Liability | $ 1 | |
| Cash Restricted Stock Units | Award Year 2018, Payable 2020 and 2021 | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Units | 9,267,227 | |
| Fair Value | $ 13 | $ 28 |
| Vested Liability | $ 0 |
Derivative and Hedging Activities - Narrative (Details) $ in Millions |
9 Months Ended | 12 Months Ended |
|---|---|---|
|
Sep. 30, 2019
USD ($)
counterparty
derivative
|
Dec. 31, 2018
USD ($)
day
derivative
$ / BTU
|
|
| Derivative [Line Items] | ||
| Expected amount to be transferred of during the next 12 months | $ 34 | |
| Designated as Hedging Instrument | ||
| Derivative [Line Items] | ||
| Derivative, number of instruments held | derivative | 0 | 0 |
| Credit Risk | ||
| Derivative [Line Items] | ||
| Number of counterparties in hedge facility | counterparty | 15 | |
| Disposal group, disposed of by sale, not discontinued operations | Utica Shale | Future Natural Gas Prices | ||
| Derivative [Line Items] | ||
| Disposal group, including discontinued operation, consideration | $ 100 | |
| Debt instrument, convertible, threshold trading days | day | 20 | |
| Debt instrument, convertible, threshold consecutive trading days | day | 30 | |
| Unrealized gain (loss) | $ (7) | |
| 2022 NYMEX Natural Gas | Disposal group, disposed of by sale, not discontinued operations | Utica Shale | Future Natural Gas Prices | ||
| Derivative [Line Items] | ||
| Disposal group, including discontinued operation, consideration | $ 50 | |
| 2022 NYMEX Natural Gas | Disposal group, disposed of by sale, not discontinued operations | Utica Shale | Future Natural Gas Prices 2022 | ||
| Derivative [Line Items] | ||
| Average sales prices (in dollars per mmbtu) | $ / BTU | 3.00 | |
| 2022 NYMEX Natural Gas | Disposal group, disposed of by sale, not discontinued operations | Utica Shale | Future Natural Gas Prices 2023 | ||
| Derivative [Line Items] | ||
| Average sales prices (in dollars per mmbtu) | $ / BTU | 3.25 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
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| Statement of Comprehensive Income [Abstract] | |||||||||||||||
| NET INCOME (LOSS) | $ (61) | $ (146) | [1],[2] | $ 16 | $ (377) | [1],[2],[3] | |||||||||
| OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX: | |||||||||||||||
| Unrealized gains on derivative instruments | [4] | 0 | 0 | ||||||||||||
| Unrealized gains on derivative instruments | [1],[4] | 0 | 0 | ||||||||||||
| Reclassification of losses on settled derivative instruments | [4] | 8 | 26 | ||||||||||||
| Reclassification of losses on settled derivative instruments | [1],[4] | 8 | 25 | ||||||||||||
| Other Comprehensive Income | 8 | 8 | [1] | 26 | 25 | [1] | |||||||||
| COMPREHENSIVE INCOME (LOSS) | (53) | (138) | [1] | 42 | (352) | [1] | |||||||||
| COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS | 0 | 0 | [1] | 0 | (1) | [1] | |||||||||
| COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CHESAPEAKE | $ (53) | $ (138) | [1] | $ 42 | $ (353) | [1] | |||||||||
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Other Liabilities |
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other Liabilities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other Liabilities | Other Liabilities Other current liabilities as of September 30, 2019 and December 31, 2018 are detailed below:
Other long-term liabilities as of September 30, 2019 and December 31, 2018 are detailed below:
____________________________________________ (a) At the inception of our volumetric production payment (VPP) agreements, we (i) removed the proved reserves associated with the VPP, (ii) recognized VPP proceeds as deferred revenue which are being amortized on a unit-of-production basis to other revenue over the term of the VPP, (iii) retained responsibility for the production costs and capital costs related to VPP interests and (iv) ceased recognizing production associated with the VPP volumes. The remaining deferred revenue balance will be recognized in other revenues in the consolidated statement of operations through 2021, assuming the related VPP production volumes are delivered as scheduled.
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