(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 March 31, 2020 and December 31, 2019 | ||||
for the Three Months Ended March 31, 2020 and 2019 | ||||
for the Three Months Ended March 31, 2020 and 2019 | ||||
for the Three Months Ended March 31, 2020 and 2019 | ||||
for the Three Months Ended March 31, 2020 and 2019 | ||||
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 |
March 31, 2020 | December 31, 2019 | |||||||
($ in millions) | ||||||||
CURRENT ASSETS: | ||||||||
Cash and cash equivalents ($2 and $2 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 (($748) and ($713) attributable to our VIE) | ( | ) | ( | ) | ||||
Property and equipment held for sale, net | ||||||||
Total Property and Equipment, Net | ||||||||
LONG-TERM ASSETS: | ||||||||
Other long-term assets | ||||||||
TOTAL ASSETS | $ | $ | ||||||
March 31, 2020 | December 31, 2019 | |||||||
($ in millions) | ||||||||
CURRENT LIABILITIES: | ||||||||
Accounts payable | $ | $ | ||||||
Current maturities of long-term debt, net | ||||||||
Accrued interest | ||||||||
Short-term derivative liabilities | ||||||||
Other current liabilities ($1 and $1 attributable to our VIE) | ||||||||
Total Current Liabilities | ||||||||
LONG-TERM LIABILITIES: | ||||||||
Long-term debt, net | ||||||||
Long-term derivative liabilities | ||||||||
Asset retirement obligations, net of current portion | ||||||||
Other long-term liabilities | ||||||||
Total Long-Term Liabilities | ||||||||
EQUITY: | ||||||||
Chesapeake Stockholders’ Equity: | ||||||||
Preferred stock, $0.01 par value, 20,000,000 shares authorized 5,563,458 shares outstanding | ||||||||
Common stock, $0.01 par value, 22,500,000 and 15,000,000 shares authorized: 9,783,773 and 9,772,793 shares issued(a) | ||||||||
Additional paid-in capital(a) | ||||||||
Accumulated deficit | ( | ) | ( | ) | ||||
Accumulated other comprehensive income | ||||||||
Less: treasury stock, at cost; 0 and 26,224 common shares(a) | ( | ) | ||||||
Total Chesapeake Stockholders’ Equity (Deficit) | ( | ) | ||||||
Noncontrolling interests | ||||||||
Total Equity (Deficit) | ( | ) | ||||||
TOTAL LIABILITIES AND EQUITY | $ | $ | ||||||
(a) | Amounts and shares have been retroactively adjusted to reflect a 1-for-200 (1:200) reverse stock split effective April 14, 2020. See Note 17 for additional information. |
Three Months Ended March 31, | |||||||||
2020 | 2019 | ||||||||
($ 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 | |||||||||
Severance and ad valorem taxes | |||||||||
Exploration | |||||||||
Marketing | |||||||||
General and administrative | |||||||||
Restructuring and other termination costs | |||||||||
Provision for legal contingencies, net | |||||||||
Depreciation, depletion and amortization | |||||||||
Impairments | |||||||||
Other operating expense | |||||||||
Total Operating Expenses | |||||||||
LOSS FROM OPERATIONS | ( | ) | ( | ) | |||||
OTHER INCOME (EXPENSE): | |||||||||
Interest expense | ( | ) | ( | ) | |||||
Losses on investments | ( | ) | ( | ) | |||||
Gains on purchases or exchanges of debt | |||||||||
Other income | |||||||||
Total Other Expense | ( | ) | ( | ) | |||||
LOSS BEFORE INCOME TAXES | ( | ) | ( | ) | |||||
Income tax benefit | ( | ) | ( | ) | |||||
NET LOSS | ( | ) | ( | ) | |||||
Net loss attributable to noncontrolling interests | |||||||||
NET LOSS ATTRIBUTABLE TO CHESAPEAKE | ( | ) | ( | ) | |||||
Preferred stock dividends | ( | ) | ( | ) | |||||
NET LOSS AVAILABLE TO COMMON STOCKHOLDERS | $ | ( | ) | $ | ( | ) | |||
LOSS PER COMMON SHARE:(a) | |||||||||
Basic | $ | ( | ) | $ | ( | ) | |||
Diluted | $ | ( | ) | $ | ( | ) | |||
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in thousands):(a) | |||||||||
Basic | |||||||||
Diluted | |||||||||
(a) | All share and per share information has been retroactively adjusted to reflect a 1-for-200 (1:200) reverse stock split effective April 14, 2020. See Note 17 for additional information. |
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions) | ||||||||
NET LOSS | $ | ( | ) | $ | ( | ) | ||
OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX: | ||||||||
Reclassification of losses on settled derivative instruments(a) | ||||||||
Other Comprehensive Income | ||||||||
COMPREHENSIVE LOSS | ( | ) | ( | ) | ||||
COMPREHENSIVE LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS | ||||||||
COMPREHENSIVE LOSS ATTRIBUTABLE TO CHESAPEAKE | $ | ( | ) | $ | ( | ) | ||
(a) | Deferred tax activity incurred in other comprehensive income was offset by a valuation allowance. |
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions) | ||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
NET LOSS | $ | ( | ) | $ | ( | ) | ||
ADJUSTMENTS TO RECONCILE NET LOSS TO CASH PROVIDED BY OPERATING ACTIVITIES: | ||||||||
Depreciation, depletion and amortization | ||||||||
Deferred income tax benefit | ( | ) | ( | ) | ||||
Derivative (gains) losses, net | ( | ) | ||||||
Cash receipts on derivative settlements, net | ||||||||
Stock-based compensation | ||||||||
Gains on sales of assets | ( | ) | ||||||
Impairments | ||||||||
Exploration | ||||||||
Losses on investments | ||||||||
Gains 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 | ||||||||
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 | ( | ) | ( | ) | ||||
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 | $ | $ | ||||||
Supplemental disclosures to the condensed consolidated statements of cash flows are presented below: | ||||||||
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ 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 | $ | $ | ||||||
Change in accrued drilling and completion costs | $ | ( | ) | $ | ||||
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions) | ||||||||
PREFERRED STOCK: | ||||||||
Balance, beginning and end of period | $ | $ | ||||||
COMMON STOCK:(a) | ||||||||
Balance, beginning of period | ||||||||
Common shares issued for WildHorse Merger | ||||||||
Balance, end of period | ||||||||
ADDITIONAL PAID-IN CAPITAL:(a) | ||||||||
Balance, beginning of period | ||||||||
Common shares issued for WildHorse Merger | ||||||||
Stock-based compensation | ( | ) | ||||||
Dividends on preferred stock | ( | ) | ( | ) | ||||
Balance, end of period | ||||||||
ACCUMULATED DEFICIT: | ||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||
Net loss attributable to Chesapeake | ( | ) | ( | ) | ||||
Balance, end of period | ( | ) | ( | ) | ||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | ||||||||
Balance, beginning of period | ( | ) | ||||||
Hedging activity | ||||||||
Balance, end of period | ( | ) | ||||||
TREASURY STOCK – COMMON:(a) | ||||||||
Balance, beginning of period | ( | ) | ( | ) | ||||
Purchase of 17,901 and 12,697 shares for company benefit plans | ( | ) | ( | ) | ||||
Release of 44,126 and 553 shares from company benefit plans | ||||||||
Balance, end of period | ( | ) | ||||||
TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY (DEFICIT) | ( | ) | ||||||
NONCONTROLLING INTERESTS: | ||||||||
Balance, beginning of period | ||||||||
Net loss attributable to noncontrolling interests | ( | ) | ||||||
Balance, end of period | ||||||||
TOTAL EQUITY (DEFICIT) | $ | ( | ) | $ | ||||
(a) | Amounts and shares have been retroactively adjusted to reflect a 1-for-200 (1:200) reverse stock split effective April 14, 2020. See Note 17 for additional information. |
1. | Basis of Presentation and Summary of Significant Accounting Policies |
2. | Going Concern |
Three Months Ended March 31, | ||||||
2020 | 2019 | |||||
(in thousands) | ||||||
Common stock equivalent of our preferred stock outstanding(a) | ||||||
Common stock equivalent of our convertible senior notes outstanding(a) | ||||||
Participating securities(a) | ||||||
(a) | Amount has been retroactively adjusted to reflect a 1-for-200 (1:200) reverse stock split effective April 14, 2020. See Note 17 for additional information. |
4. | Debt |
March 31, 2020 | December 31, 2019 | ||||||||||||||
Principal Amount | Carrying Amount | Principal Amount | Carrying Amount | ||||||||||||
($ in millions) | |||||||||||||||
Revolving credit facility | $ | $ | $ | $ | |||||||||||
Term loan due 2024 | |||||||||||||||
11.5% senior secured second lien notes due 2025 | |||||||||||||||
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 | |||||||||||||||
8.00% senior notes due 2025 | |||||||||||||||
5.5% convertible senior notes due 2026(a)(b) | |||||||||||||||
7.5% senior notes due 2026 | |||||||||||||||
8.00% senior notes due 2026 | |||||||||||||||
8.00% senior notes due 2027 | |||||||||||||||
Debt issuance costs | — | ( | ) | — | ( | ) | |||||||||
Total debt, net | |||||||||||||||
Less current maturities of long-term debt, net(c) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Total long-term debt, net | $ | $ | $ | $ | |||||||||||
(a) | 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 |
(b) | Prior to maturity under certain circumstances and at the holder’s option, the notes are convertible. During the Current Quarter, the price of our common stock was below the threshold level for conversion and, as a result, the holders do not have the option to convert their notes in the second quarter of 2020. |
(c) | As of March 31, 2020, net current maturities of long-term debt includes our |
Notes Repurchased | ||||
($ in millions) | ||||
6.625% senior notes due 2020 | $ | |||
6.875% senior notes due 2020 | ||||
4.875% senior notes due 2022 | ||||
5.75% senior notes due 2023 | ||||
Total | $ | |||
March 31, 2020 | December 31, 2019 | |||||||||||||||
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) | $ | $ | $ | $ | ||||||||||||
5. | Contingencies and Commitments |
March 31, 2020 | ||||
($ in millions) | ||||
Remainder of 2020 | $ | |||
2021 | ||||
2022 | ||||
2023 | ||||
2024 | ||||
2025 – 2034 | ||||
Total | $ | |||
6. | Other Liabilities |
March 31, 2020 | December 31, 2019 | |||||||
($ in millions) | ||||||||
Revenues and royalties due others | $ | $ | ||||||
Accrued drilling and production costs | ||||||||
Joint interest prepayments received | ||||||||
VPP deferred revenue(a) | ||||||||
Accrued compensation and benefits(b) | ||||||||
Other accrued taxes | ||||||||
Other | ||||||||
Total other current liabilities | $ | $ | ||||||
March 31, 2020 | December 31, 2019 | |||||||
($ in millions) | ||||||||
VPP deferred revenue(a) | $ | $ | ||||||
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. |
(b) | In the Current Quarter, we terminated our nonqualified deferred compensation plan. Accordingly, we derecognized the asset associated with the plan after the participants’ investments were liquidated. The cash was distributed to the participants and we extinguished the corresponding $ |
7. | Revenue |
Three Months Ended March 31, 2020 | ||||||||||||||||
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 | ||||||||||||||||
Marketing revenue | $ | $ | $ | $ | ||||||||||||
Three Months Ended March 31, 2019 | ||||||||||||||||
Oil | Natural Gas | NGL | Total | |||||||||||||
($ in millions) | ||||||||||||||||
Marcellus | $ | $ | $ | $ | ||||||||||||
Haynesville | ||||||||||||||||
Eagle Ford | ||||||||||||||||
Brazos Valley | ||||||||||||||||
Powder River Basin | ||||||||||||||||
Mid-Continent | ||||||||||||||||
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 | ||||||||||||||||
Losses on marketing derivatives | ( | ) | ( | ) | ||||||||||||
Marketing revenue | $ | $ | $ | $ | ||||||||||||
March 31, 2020 | December 31, 2019 | |||||||
($ in millions) | ||||||||
Oil, natural gas and NGL sales | $ | $ | ||||||
Joint interest | ||||||||
Other | ||||||||
Allowance for doubtful accounts | ( | ) | ( | ) | ||||
Total accounts receivable, net | $ | $ | ||||||
8. | Income Taxes |
9. | Equity |
Three Months Ended March 31, | ||||||
2020 | 2019 | |||||
(in thousands) | ||||||
Beginning balance(a) | ||||||
Common shares issued for WildHorse Merger(a) | ||||||
Restricted stock issuances (net of forfeitures and cancellations)(a)(b) | ||||||
Ending balance(a) | ||||||
(a) | All share information has been retroactively adjusted to reflect a 1-for-200 (1:200) reverse stock split effective April 14, 2020. See Note 17 for additional information. |
(b) |
10. | Share-Based Compensation |
Shares of Unvested Restricted Stock(a) | Weighted Average Grant Date Fair Value Per Share(a) | ||||||
(in thousands) | |||||||
Unvested restricted stock as of January 1, 2020 | $ | ||||||
Granted | $ | ||||||
Vested | ( | ) | $ | ||||
Forfeited | $ | ||||||
Unvested restricted stock as of March 31, 2020 | $ | ||||||
(a) | All share information has been retroactively adjusted to reflect a 1-for-200 (1:200) reverse stock split effective April 14, 2020. See Note 17 for additional information. |
Number of Shares Underlying Options(a) | Weighted Average Exercise Price Per Share(a) | Weighted Average Contract Life in Years | Aggregate Intrinsic Value(b) | ||||||||||
(in thousands) | ($ in millions) | ||||||||||||
Outstanding as of January 1, 2020 | $ | $ | |||||||||||
Granted | $ | ||||||||||||
Exercised | $ | $ | |||||||||||
Expired | ( | ) | $ | ||||||||||
Forfeited | $ | ||||||||||||
Outstanding as of March 31, 2020 | $ | $ | |||||||||||
Exercisable as of March 31, 2020 | $ | $ | |||||||||||
(a) | All share information has been retroactively adjusted to reflect a 1-for-200 (1:200) reverse stock split effective April 14, 2020. See Note 17 for additional information. |
(b) | 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 March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions) | ||||||||
General and administrative expenses | $ | $ | ||||||
Oil and natural gas properties | ||||||||
Oil, natural gas and NGL production expenses | ||||||||
Total restricted stock and stock option compensation | $ | $ | ||||||
Grant Date Fair Value | March 31, 2020 | ||||||||||||||
Units(a) | Fair Value | Vested Liability | |||||||||||||
($ in millions) | ($ in millions) | ||||||||||||||
2019 PSU Awards: | |||||||||||||||
Payable 2021 and 2022 | $ | $ | $ | ||||||||||||
2018 PSU Awards: | |||||||||||||||
Payable 2021 | $ | $ | $ | ||||||||||||
2017 PSU Awards: | |||||||||||||||
Payable 2020 | $ | $ | $ | ||||||||||||
2018 CRSU Awards: | |||||||||||||||
Payable 2021 | $ | $ | $ | ||||||||||||
(a) | All share information has been retroactively adjusted to reflect a 1-for-200 (1:200) reverse stock split effective April 14, 2020. See Note 17 for additional information. |
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ 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 | $ | ( | ) | $ | ||||
11. | 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 sell, and occasionally buy, call 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. If the market price is lower than the fixed price of the call option, no payment is due from either party. |
• | Call Swaptions: We sell call swaptions to counterparties in exchange for a premium. Swaptions 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. |
• | Put spreads: These instruments contain a fixed floor price (bought put) and sub floor price (sold put). If the market price exceeds the bought put strike, we receive the market price. If the market price is between the bought put and sold put strike prices, we receive the bought put price. If the market price falls below the sub floor, we receive the market price plus the difference between the sold put and bought put. |
March 31, 2020 | December 31, 2019 | |||||||||||||
Notional Volume | Fair Value | Notional Volume | Fair Value | |||||||||||
($ in millions) | ($ in millions) | |||||||||||||
Oil (mmbbl): | ||||||||||||||
Fixed-price swaps | $ | $ | ( | ) | ||||||||||
Call options (sold) | ( | ) | ||||||||||||
Collars | ||||||||||||||
Basis protection swaps | ( | ) | ||||||||||||
Total oil | ||||||||||||||
Natural gas (bcf): | ||||||||||||||
Fixed-price swaps | ||||||||||||||
Call options | ( | ) | ||||||||||||
Call swaptions | ( | ) | ( | ) | ||||||||||
Put spreads | ||||||||||||||
Basis protection swaps | ||||||||||||||
Total natural gas | ||||||||||||||
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 Sheets | |||||||||
($ in millions) | ||||||||||||
As of March 31, 2020 | ||||||||||||
Commodity Contracts: | ||||||||||||
Short-term derivative asset | $ | $ | ( | ) | $ | |||||||
Short-term derivative liability | ( | ) | ||||||||||
Long-term derivative liability | ( | ) | ( | ) | ||||||||
Total derivatives | $ | $ | $ | |||||||||
As of December 31, 2019 | ||||||||||||
Commodity Contracts: | ||||||||||||
Short-term derivative asset | $ | $ | ( | ) | $ | |||||||
Short-term derivative liability | ( | ) | ( | ) | ||||||||
Long-term derivative liability | ( | ) | ( | ) | ||||||||
Total derivatives | $ | $ | $ | |||||||||
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ 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 March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions) | ||||||||
Marketing revenues | $ | $ | ||||||
Losses on undesignated marketing natural gas derivatives | ( | ) | ||||||
Total marketing revenues | $ | $ | ||||||
Three Months Ended March 31, | ||||||||||||||||
2020 | 2019 | |||||||||||||||
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 March 31, 2020 | ||||||||||||||||
Derivative Assets (Liabilities): | ||||||||||||||||
Commodity assets | $ | $ | $ | $ | ||||||||||||
Commodity liabilities | ( | ) | ( | ) | ||||||||||||
Total derivatives | $ | $ | $ | $ | ||||||||||||
As of December 31, 2019 | ||||||||||||||||
Derivative Assets (Liabilities): | ||||||||||||||||
Commodity assets | $ | $ | $ | $ | ||||||||||||
Commodity liabilities | ( | ) | ( | ) | ( | ) | ||||||||||
Total derivatives | $ | $ | $ | $ | ||||||||||||
Commodity Derivatives | Utica Contingent Consideration | |||||||
($ in millions) | ||||||||
Balance, as of January 1, 2020 | $ | $ | ||||||
Total gains (losses) (realized/unrealized): | ||||||||
Included in earnings(a) | ||||||||
Total purchases, issuances, sales and settlements: | ||||||||
Settlements | ( | ) | ||||||
Balance, as of March 31, 2020 | $ | $ | ||||||
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 March 31, 2019 | $ | $ | ||||||
(a) | Commodity Derivatives | ||||||||
2020 | 2019 | ||||||||
($ 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(a) | Fair Value March 31, 2020 | ||||||
($ in millions) | ||||||||||
Oil trades | Oil price volatility curves | 26.50% – 242.41% | $ | |||||||
Natural gas trades | Natural gas price volatility curves | 20.56% – 141.43% | $ | ( | ) | |||||
(a) | Weighted average volatility is weighted by relative volume. |
12. | Exploration Expense |
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions) | ||||||||
Impairments of unproved properties | $ | $ | ||||||
Dry hole expense | ||||||||
Geological and geophysical expense and other | ||||||||
Exploration expense | $ | $ | ||||||
13. | Impairments |
• | We calculated the expected undiscounted future net cash flows of our long-lived assets using management’s assumptions and expectations of (i) commodity prices, which are based on the NYMEX strip pricing escalated by an inflationary rate after |
• | Unprecedented volatility in the price of oil due to the decrease in demand has led us to rely on NYMEX strip pricing, which represents a Level 1 input. |
• | Significant inputs associated with the calculation of discounted future net cash flows include estimates of (i) recoverable reserves, (ii) production rates, (iii) future operating and development costs, (iv) future commodity prices escalated by an inflationary rate after |
14. | Capitalized Exploratory Well Costs |
Three Months Ended March 31, 2020 | ||||
($ in millions) | ||||
Balance as of January 1 | $ | |||
Charges to exploration expense | ( | ) | ||
Balance as of March 31 | $ | |||
15. | Investments |
16. | Other Operating Expense |
17. | Subsequent Events |
Oil | Natural Gas | NGL | Total | |||||||||
(mmbbl) | (bcf) | (mmbbl) | (mmboe) | |||||||||
March 31, 2020 | ||||||||||||
Proved reserves, beginning of period | 358 | 6,566 | 120 | 1,572 | ||||||||
Extensions, discoveries and other additions | 3 | 91 | 1 | 19 | ||||||||
Revisions of previous estimates | (136 | ) | (2,298 | ) | (40 | ) | (560 | ) | ||||
Production | (12 | ) | (173 | ) | (3 | ) | (43 | ) | ||||
Proved reserves, end of period | 213 | 4,186 | 78 | 988 | ||||||||
Proved developed reserves: | ||||||||||||
Beginning of period | 201 | 3,377 | 82 | 846 | ||||||||
End of period | 198 | 3,371 | 73 | 832 | ||||||||
Proved undeveloped reserves: | ||||||||||||
Beginning of period | 157 | 3,189 | 38 | 726 | ||||||||
End of period | 15 | 815 | 5 | 156 | ||||||||
ITEM 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Oil Derivatives(a) | |||||||
Year | Type of Derivative Instrument | Notional Volume | Average NYMEX Price | ||||
(mmbbls) | |||||||
2020 | Swaps | 21 | $59.63 | ||||
2020 | Two-way collars | 1 | $65.00/$83.25 | ||||
2020 | Basis protection swaps | 10 | $2.58 | ||||
2021 | Calls | 5 | $61.58 | ||||
2022 | Calls | 4 | $61.58 | ||||
Natural Gas Derivatives(a) | |||||||
Year | Type of Derivative Instrument | Notional Volume | Average NYMEX Price | ||||
(bcf) | |||||||
2020 | Swaps | 199 | $2.76 | ||||
2020 | Calls | 17 | $12.00 | ||||
2020 | Basis protection swaps | 46 | ($0.28) | ||||
2020 | Put spread | 94 | $2.06/$1.80 | ||||
2021 | Calls | 96 | $2.75 | ||||
2021 | Call swaptions | 14 | $2.80 | ||||
2022 | Call swaptions | 15 | $2.80 | ||||
(a) | Includes amounts settled in April and May 2020. |
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions) | ||||||||
Cash provided by operating activities | $ | 397 | $ | 456 | ||||
Proceeds from divestitures of proved and unproved properties, net | 7 | 26 | ||||||
Proceeds from revolving credit facility borrowings, net | 310 | 436 | ||||||
Proceeds from sales of other property and equipment, net | — | 1 | ||||||
Total sources of cash and cash equivalents | $ | 714 | $ | 919 | ||||
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions) | ||||||||
Oil and Natural Gas Expenditures: | ||||||||
Drilling and completion costs | $ | 501 | $ | 515 | ||||
Acquisitions of proved and unproved properties | 6 | 6 | ||||||
Total oil and natural gas expenditures | 507 | 521 | ||||||
Other Uses of Cash and Cash Equivalents: | ||||||||
Cash paid to purchase debt | 93 | 1 | ||||||
Business combination, net | — | 353 | ||||||
Additions to other property and equipment | 11 | 9 | ||||||
Dividends paid | 22 | 23 | ||||||
Other | 5 | 8 | ||||||
Total other uses of cash and cash equivalents | 131 | 394 | ||||||
Total uses of cash and cash equivalents | $ | 638 | $ | 915 | ||||
Three Months Ended March 31, 2020 | |||||||||||||||||||||||||||
Oil | Natural Gas | NGL | Total | ||||||||||||||||||||||||
mbbl per day | $/bbl | mmcf per day | $/mcf | mbbl per day | $/bbl | mboe per day | % | $/boe | |||||||||||||||||||
Marcellus | — | — | 976 | 1.97 | — | — | 163 | 34 | 11.85 | ||||||||||||||||||
Haynesville | — | — | 556 | 1.68 | — | — | 93 | 19 | 10.10 | ||||||||||||||||||
Eagle Ford | 63 | 48.53 | 159 | 2.18 | 19 | 11.71 | 108 | 23 | 33.38 | ||||||||||||||||||
Brazos Valley | 41 | 46.30 | 69 | 0.60 | 9 | 5.26 | 61 | 13 | 32.55 | ||||||||||||||||||
Powder River Basin | 17 | 43.23 | 89 | 1.84 | 6 | 13.30 | 38 | 8 | 26.01 | ||||||||||||||||||
Mid-Continent | 5 | 44.75 | 49 | 2.24 | 3 | 14.06 | 16 | 3 | 23.38 | ||||||||||||||||||
Retained assets(a) | 126 | 46.93 | 1,898 | 1.86 | 37 | 10.71 | 479 | 100 | 20.53 | ||||||||||||||||||
Divested assets | — | — | — | — | — | — | — | — | — | ||||||||||||||||||
Total | 126 | 46.93 | 1,898 | 1.86 | 37 | 10.71 | 479 | 100 | % | 20.53 | |||||||||||||||||
Three Months Ended March 31, 2019 | |||||||||||||||||||||||||||
Oil | Natural Gas | NGL | Total | ||||||||||||||||||||||||
mbbl per day | $/bbl | mmcf per day | $/mcf | mbbl per day | $/bbl | mboe per day | % | $/boe | |||||||||||||||||||
Marcellus | — | — | 948 | 3.54 | — | — | 158 | 33 | 21.23 | ||||||||||||||||||
Haynesville | — | — | 759 | 2.94 | — | — | 126 | 26 | 17.63 | ||||||||||||||||||
Eagle Ford | 61 | 59.78 | 148 | 3.58 | 24 | 21.70 | 109 | 23 | 43.01 | ||||||||||||||||||
Brazos Valley(b) | 23 | 59.32 | 23 | 2.04 | 3 | 8.25 | 30 | 6 | 47.55 | ||||||||||||||||||
Powder River Basin | 16 | 50.93 | 82 | 3.38 | 6 | 18.57 | 36 | 7 | 33.70 | ||||||||||||||||||
Mid-Continent | 8 | 52.93 | 58 | 2.82 | 6 | 21.64 | 23 | 5 | 30.77 | ||||||||||||||||||
Retained assets(a) | 108 | 57.85 | 2,018 | 3.27 | 39 | 20.03 | 482 | 100 | 28.23 | ||||||||||||||||||
Divested assets | 1 | 48.05 | 5 | 2.48 | — | — | 2 | — | 25.59 | ||||||||||||||||||
Total | 109 | 57.80 | 2,023 | 3.27 | 39 | 20.03 | 484 | 100 | % | 28.22 | |||||||||||||||||
(a) | Includes assets retained as of March 31, 2020. |
Three Months Ended March 31, | |||||||||||
2020 | 2019 | Change | |||||||||
($ in millions) | |||||||||||
Oil | $ | 539 | $ | 566 | (5 | )% | |||||
Natural gas | 320 | 595 | (46 | )% | |||||||
NGL | 35 | 69 | (49 | )% | |||||||
Oil, natural gas and NGL sales | $ | 894 | $ | 1,230 | (27 | )% | |||||
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions) | ||||||||
Oil derivatives – realized gains (losses) | $ | 127 | $ | 10 | ||||
Oil derivatives – unrealized gains (losses) | 712 | (269 | ) | |||||
Total gains (losses) on oil derivatives | 839 | (259 | ) | |||||
Natural gas derivatives – realized gains (losses) | 51 | (36 | ) | |||||
Natural gas derivatives – unrealized gains (losses) | 17 | (6 | ) | |||||
Total gains (losses) on natural gas derivatives | 68 | (42 | ) | |||||
Total gains (losses) on oil and natural gas derivatives | $ | 907 | $ | (301 | ) | |||
Three Months Ended March 31, | |||||||||||
2020 | 2019 | Change | |||||||||
($ in millions) | |||||||||||
Marketing revenues | $ | 724 | $ | 1,233 | (41 | )% | |||||
Marketing expenses | 746 | 1,230 | (39 | )% | |||||||
Marketing margin | $ | (22 | ) | $ | 3 | 833 | % | ||||
Three Months Ended March 31, | |||||||||||
2020 | 2019 | Change | |||||||||
($ in millions) | |||||||||||
Other revenue | $ | 16 | $ | 15 | 7 | % | |||||
Three Months Ended March 31, | |||||||||||
2020 | 2019 | Change | |||||||||
($ in millions, except per unit) | |||||||||||
Marcellus | $ | 9 | $ | 9 | — | % | |||||
Haynesville | 11 | 14 | (21 | )% | |||||||
Eagle Ford | 36 | 41 | (12 | )% | |||||||
Brazos Valley | 27 | 14 | 93 | % | |||||||
Powder River Basin | 18 | 14 | 29 | % | |||||||
Mid-Continent | 21 | 25 | (16 | )% | |||||||
Retained Assets(a) | 122 | 117 | 4 | % | |||||||
Divested Assets | — | (2 | ) | (100 | )% | ||||||
Total oil, natural gas and NGL production expenses | $ | 122 | $ | 115 | 6 | % | |||||
Marcellus | $ | 0.58 | $ | 0.63 | (8 | )% | |||||
Haynesville | $ | 1.30 | $ | 1.22 | 7 | % | |||||
Eagle Ford | $ | 3.62 | $ | 4.15 | (13 | )% | |||||
Brazos Valley | $ | 4.98 | $ | 5.36 | (7 | )% | |||||
Powder River Basin | $ | 5.28 | $ | 4.36 | 21 | % | |||||
Mid-Continent | $ | 13.95 | $ | 11.79 | 18 | % | |||||
Retained Assets(a) | $ | 2.80 | $ | 2.69 | 4 | % | |||||
Divested Assets | $ | — | $ | (10.24 | ) | (100 | )% | ||||
Total oil, natural gas and NGL production expenses per boe | $ | 2.80 | $ | 2.64 | 6 | % | |||||
Three Months Ended March 31, | |||||||||||
2020 | 2019 | Change | |||||||||
($ in millions, except per unit) | |||||||||||
Oil, natural gas and NGL gathering, processing and transportation expenses | $ | 285 | $ | 274 | 4 | % | |||||
Oil ($ per bbl) | $ | 3.40 | $ | 3.47 | (2 | )% | |||||
Natural gas ($ per mcf) | $ | 1.32 | $ | 1.21 | 9 | % | |||||
NGL ($ per bbl) | $ | 5.70 | $ | 5.57 | 2 | % | |||||
Total ($ per boe) | $ | 6.55 | $ | 6.29 | 4 | % | |||||
Three Months Ended March 31, | |||||||||||
2020 | 2019 | Change | |||||||||
($ in millions, except per unit) | |||||||||||
Severance taxes | $ | 31 | $ | 34 | (9 | )% | |||||
Ad valorem taxes | 23 | 17 | 35 | % | |||||||
Severance and ad valorem taxes | $ | 54 | $ | 51 | 6 | % | |||||
Severance taxes per boe | $ | 0.71 | $ | 0.78 | (9 | )% | |||||
Ad valorem taxes per boe | 0.53 | 0.37 | 43 | % | |||||||
Severance and ad valorem taxes per boe | $ | 1.24 | $ | 1.15 | 8 | % | |||||
Three Months Ended March 31, | |||||||||||
2020 | 2019 | Change | |||||||||
($ in millions) | |||||||||||
Impairments of unproved properties | $ | 272 | $ | 18 | 1,411 | % | |||||
Dry hole expense | 7 | — | n/a | ||||||||
Geological and geophysical expense and other | 3 | 6 | (50 | )% | |||||||
Exploration expense | $ | 282 | $ | 24 | 1,075 | % | |||||
Three Months Ended March 31, | |||||||||||
2020 | 2019 | Change | |||||||||
($ in millions, except per unit) | |||||||||||
Gross compensation and overhead | $ | 161 | $ | 195 | (17 | )% | |||||
Allocated to production expenses | (30 | ) | (35 | ) | (14 | )% | |||||
Allocated to marketing expenses | (4 | ) | (4 | ) | — | % | |||||
Allocated to exploration expenses | — | (4 | ) | (100 | )% | ||||||
Allocated to sand mine expenses | (2 | ) | — | n/a | |||||||
Capitalized general and administrative expenses | (21 | ) | (13 | ) | 62 | % | |||||
Reimbursed from third parties | (39 | ) | (36 | ) | 8 | % | |||||
General and administrative expenses, net | $ | 65 | $ | 103 | (37 | )% | |||||
General and administrative expenses, net per boe | $ | 1.50 | $ | 2.34 | (36 | )% | |||||
Three Months Ended March 31, | |||||||||||
2020 | 2019 | Change | |||||||||
($ in millions, except per unit) | |||||||||||
Depreciation, depletion and amortization | $ | 603 | $ | 519 | 16 | % | |||||
Depreciation, depletion and amortization per boe | $ | 13.83 | $ | 11.90 | 16 | % | |||||
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions) | ||||||||
Impairments of proved oil and natural gas properties | $ | 8,446 | $ | — | ||||
Impairments of other fixed assets and other | 76 | 1 | ||||||
Total impairments | $ | 8,522 | $ | 1 | ||||
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions) | ||||||||
Other operating expense | $ | 83 | $ | 61 | ||||
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
($ in millions, except per unit) | ||||||||
Interest expense on senior notes | $ | 129 | $ | 144 | ||||
Interest expense on term loan | 38 | — | ||||||
Amortization of discount, issuance costs and other | 7 | 6 | ||||||
Amortization of premium | (44 | ) | — | |||||
Interest expense on revolving credit facility | 22 | 17 | ||||||
Realized gains on interest rate derivatives | — | (1 | ) | |||||
Unrealized losses on interest rate derivatives | — | 1 | ||||||
Capitalized interest | (7 | ) | (6 | ) | ||||
Total interest expense | $ | 145 | $ | 161 | ||||
Interest expense per boe | $ | 3.34 | $ | 3.72 | ||||
Average senior notes borrowings | $ | 5,783 | $ | 8,207 | ||||
Average credit facilities borrowings | $ | 1,648 | $ | 1,021 | ||||
Average term loan borrowings | $ | 1,500 | $ | — | ||||
Obligors | ||||||||
March 31, 2020 | December 31, 2020 | |||||||
($ in millions) | ||||||||
Current assets | $ | 1,761 | $ | 1,158 | ||||
Total property and equipment, net | $ | 4,671 | $ | 10,480 | ||||
Long-term assets | $ | 144 | $ | 166 | ||||
Current liabilities | $ | 2,085 | $ | 2,231 | ||||
Long-term liabilities | $ | 9,453 | $ | 9,380 | ||||
Obligors | ||||
Three Months Ended March 31, 2020 | ||||
$ in millions | ||||
REVENUES: | ||||
Oil, natural gas and NGL | $ | 1,619 | ||
Marketing | 724 | |||
Total Revenues | 2,343 | |||
Other | 14 | |||
Total Revenues and Other | 2,357 | |||
OPERATING EXPENSES: | ||||
Oil, natural gas and NGL production | 95 | |||
Oil, natural gas and NGL gathering, processing and transportation | 275 | |||
Production taxes | 38 | |||
Exploration | 120 | |||
Marketing | 745 | |||
General and administrative | 65 | |||
Restructuring and other termination costs | 5 | |||
Provision for legal contingencies, net | 1 | |||
Depreciation, depletion and amortization | 430 | |||
Impairments | 5,589 | |||
Other operating expense | 82 | |||
Total Operating Expenses | 7,445 | |||
LOSS FROM OPERATIONS | (5,088 | ) | ||
OTHER INCOME (EXPENSE): | ||||
Interest expense | (148 | ) | ||
Losses on investments | (23 | ) | ||
Gains on purchases or exchanges of debt | 63 | |||
Other income | 6 | |||
Total Other Expense | (102 | ) | ||
LOSS BEFORE INCOME TAXES | (5,190 | ) | ||
INCOME TAX BENEFIT | (13 | ) | ||
NET LOSS | (5,177 | ) | ||
Net loss attributable to noncontrolling interests | — | |||
NET LOSS ATTRIBUTABLE TO CHESAPEAKE | (5,177 | ) | ||
Other comprehensive income | 9 | |||
COMPREHENSIVE LOSS ATTRIBUTABLE TO CHESAPEAKE | $ | (5,168 | ) | |
• | the impact of the COVID-19 pandemic and its effect on our business, financial condition, employees, contractors, vendors and the global demand for oil and natural gas and U.S. and world financial markets; |
• | 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 impact of any strategic alternatives; |
• | the volatility of oil, natural gas and NGL prices, which are affected by general economic and business conditions, as well as increased demand for (and availability of) alternative fuels and electric vehicles; |
• | 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; |
• | legislative and regulatory initiatives addressing environmental concerns, including initiatives addressing the impact of global climate change or further regulating hydraulic fracturing, methane emissions, flaring or water disposal; |
• | 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 2019 Form 10-K and this Form 10-Q. |
ITEM 3. | Quantitative and Qualitative Disclosures About Market Risk |
Years of Maturity | |||||||||||||||||||||||||||
2020 | 2021 | 2022 | 2023 | 2024 | Thereafter | Total | |||||||||||||||||||||
($ in millions) | |||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||
Debt – fixed rate | $ | 253 | $ | 294 | $ | 272 | $ | 167 | $ | 624 | $ | 4,060 | $ | 5,670 | |||||||||||||
Average interest rate | 6.70 | % | 5.80 | % | 4.88 | % | 5.75 | % | 7.00 | % | 9.34 | % | 7.58 | % | |||||||||||||
Debt – variable rate | $ | — | $ | — | $ | — | $ | 1,900 | $ | 1,500 | $ | — | $ | 3,400 | |||||||||||||
Average interest rate | — | % | — | % | — | % | 3.81 | % | 9.00 | % | — | % | 6.10 | % | |||||||||||||
ITEM 4. | Controls and Procedures |
ITEM 1. | Legal Proceedings |
ITEM 1A. | Risk Factors |
• | 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) | ||||||||||||||
January 1, 2020 through January 31, 2020 | 131 | $ | 158.00 | — | $ | — | ||||||||
February 1, 2020 through February 29, 2020 | 17,770 | $ | 90.00 | — | $ | — | ||||||||
March 1, 2020 through March 31, 2020 | — | $ | — | — | $ | — | ||||||||
Total | 17,901 | $ | 90.50 | — | ||||||||||
(a) | Includes shares of common stock purchased on behalf of our deferred compensation plan, which we terminated in January 2020 in accordance with its terms. All share information has been retroactively adjusted to reflect a 1-for-200 (1:200) reverse stock split effective April 14, 2020. See Note 6 and Note 17 for additional information. |
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 | 8-K | 001-13726 | 3.1 | 4/13/2020 | ||||||||
3.1.3 | 10-Q | 001-13726 | 3.1.4 | 11/10/2008 | ||||||||
3.1.4 | 10-Q | 001-13726 | 3.1.6 | 8/11/2008 | ||||||||
3.1.5 | 8-K | 001-13726 | 3.2 | 5/20/2010 | ||||||||
3.1.6 | 10-Q | 001-13726 | 3.1.5 | 8/9/2010 | ||||||||
3.1.7 | 8-K | 001-13726 | 3.1 | 4/13/2020 | ||||||||
3.2 | 8-K | 001-13726 | 3.2 | 6/19/2014 | ||||||||
4.1 | 8-K | 001-13726 | 4.1 | 4/23/2020 | ||||||||
22.1 | 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: May 11, 2020 | By: | /s/ ROBERT D. LAWLER | |
Robert D. Lawler President and Chief Executive Officer | |||
Date: May 11, 2020 | By: | /s/ DOMENIC J. DELL’OSSO, JR. | |
Domenic J. Dell’Osso, Jr. Executive Vice President and Chief Financial Officer | |||
Subsidiary | Jurisdiction of Formation | Registered Security | Guarantor Status |
Chesapeake AEZ Exploration, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake Appalachia, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake-Clements Acquisition, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake E&P Holding, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake Energy Louisiana, LLC | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake Energy Marketing, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake Exploration, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake Land Development Company, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake Louisiana, L.P. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake Midstream Development, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake NG Ventures Corporation | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake Operating, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake Plains, LLC | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake Royalty, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Chesapeake VRT, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
CHK Energy Holdings, Inc. | Texas | Senior Notes | Joint and Several, Fully and Unconditionally |
CHK Utica, L.L.C. | Delaware | Senior Notes | Joint and Several, Fully and Unconditionally |
Compass Manufacturing, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
EMLP, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Empress, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Empress Louisiana Properties, L.P. | Texas | Senior Notes | Joint and Several, Fully and Unconditionally |
GSF, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
MC Louisiana Minerals, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
MC Mineral Company, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Midcon Compression, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Nomac Services, L.L.C. | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
Northern Michigan Exploration Company, L.L.C. | Michigan | Senior Notes | Joint and Several, Fully and Unconditionally |
Sparks Drive SWD, Inc. | Delaware | Senior Notes | Joint and Several, Fully and Unconditionally |
Winter Moon Energy Corporation | Oklahoma | Senior Notes | Joint and Several, Fully and Unconditionally |
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. |
May 11, 2020 | 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. |
May 11, 2020 | 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. |
May 11, 2020 | 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. |
May 11, 2020 | By: | /s/ DOMENIC J. DELL’OSSO, JR. |
Domenic J. Dell’Osso, Jr. | ||
Executive Vice President and Chief Financial Officer | ||
Derivative and Hedging Activities - Narrative (Details) $ in Millions |
Mar. 31, 2020
USD ($)
counterparty
derivative
|
Dec. 31, 2019
derivative
|
|---|---|---|
| Derivative [Line Items] | ||
| Expected amount to be transferred of during the next 12 months | $ | $ 29 | |
| Credit Risk | ||
| Derivative [Line Items] | ||
| Number of counterparties in hedge facility | counterparty | 11 | |
| Designated as Hedging Instrument | ||
| Derivative [Line Items] | ||
| Derivative, number of instruments held | derivative | 0 | 0 |
Income Taxes - Narrative (Details) - USD ($) |
3 Months Ended | ||
|---|---|---|---|
Mar. 31, 2020 |
Dec. 31, 2019 |
Mar. 31, 2019 |
|
| Business Acquisition [Line Items] | |||
| Effective income tax rate | 0.10% | ||
| Deferred income tax expense | $ (10,000,000) | $ 10,000,000 | $ (314,000,000) |
| Income tax benefit | $ 13,000,000 | 314,000,000 | |
| Ownership change, cumulative shift | 40.00% | ||
| Wildhorse Resource Development Corporation | |||
| Business Acquisition [Line Items] | |||
| Deferred tax liabilities | 314,000,000 | ||
| Income tax benefit | $ 13,000,000 | 314,000,000 | |
| Deferred tax liability, plant, property and equipment and prepaid compensation | 401,000,000 | ||
| Deferred tax assets, operating loss carryforward, limitations | $ 61,000,000 | ||
| Wildhorse Resource Development Corporation | Federal | |||
| Business Acquisition [Line Items] | |||
| Deferred tax asset, operating loss carryforward | $ 87,000,000 | ||
Earnings Per Share |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 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:
____________________________________________
As a result of the Company’s reverse stock split effective on April 14, 2020, proportionate adjustments were made to the conversion price of Chesapeake’s outstanding 5.5% Convertible Senior Notes due 2026, 4.5% Cumulative Convertible Preferred Stock, 5.00% Cumulative Convertible Preferred Stock (Series 2005B), 5.75% Cumulative Convertible Non-Voting Preferred Stock (Series A) and 5.75% Cumulative Non-Voting Convertible Preferred Stock and to the outstanding awards and number of shares issued and issuable under the Company's equity compensation plans. See Note 17 for additional information.
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Income Taxes |
3 Months Ended |
|---|---|
Mar. 31, 2020 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes We estimate our annual effective tax rate (AETR) for continuing operations in recording our quarterly income tax provision 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 AETR as such items are recognized as discrete items in the quarter in which they occur. Our estimated AETR for the Current Quarter is 0.1%. The impairments recorded during the Current Quarter (See Note 13 for additional information on the impairments) resulted in the deferred tax position attributable to Texas reverting back to a net asset before valuation allowance. As such, the $10 million of deferred tax expense recorded during the fourth quarter of 2019 is being reversed through the determination of the estimated AETR and application of such to the year-to-date pre-tax book income. The estimated AETR is low as a result of projecting a full valuation allowance for the year with only the $10 million going through the estimated AETR as a deferred tax benefit. Based on all available positive and negative evidence, including projections of future taxable income, we believe it is more likely than not that our 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 March 31, 2020. Such evidence limits our ability to consider various forms of subjective positive evidence, such as any projections of 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, primarily federal net operating loss (NOL) carryforwards. A full valuation allowance was recorded against our net deferred tax asset position for federal and state purposes as of March 31, 2020 and, with the exception of Texas, as of December 31, 2019. On February 1, 2019, we completed the acquisition of WildHorse Resource Development Corporation (“WildHorse”). For federal income tax purposes, the transaction (the “WildHorse Merger”) 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 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 $13 million for the Current Quarter. The benefit for the Current Quarter was primarily a result of reversing substantially all of the deferred tax liability associated with Texas through the estimated AETR and recording a receivable for amounts previously sequestered from refunds of corporate alternative minimum tax (AMT) credits. 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. On April 23, 2020, our Board of Directors approved the adoption of a rights plan that is intended to protect value by preserving our ability to use our tax attributes, such as NOLs, to offset potential future income taxes for federal income tax purposes. See Note 17 for additional information. As of March 31, 2020, 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 and other tax attributes. However, with our cumulative shift in excess of 40%, 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 and possibly other tax attributes (which annual limitation could potentially be very low). On March 27, 2020, the President signed into law the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The CARES Act provides relief to corporate taxpayers by permitting a five year carryback of 2018 through 2020 NOLs, removing the 80% limitation on the utilization of certain NOLs carried forward to years beginning before January 1, 2021, increasing the 30% limitation on interest expense deductibility under Section 163(j) of the Code to 50% of adjusted taxable income for 2019 and 2020 and accelerating refunds for AMT credit carryforwards, along with a few other provisions. With respect to the Current Quarter, there was no impact on our income tax provision from the enactment of the CARES Act.
|
Exploration Expense (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Extractive Industries [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of exploration expense | A summary of our exploration expense for the Current Quarter and the Prior Quarter is as follows:
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Revenue (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 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 and the Prior Quarter:
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| Schedule of accounts receivable | Accounts receivable as of March 31, 2020 and December 31, 2019 are detailed below:
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Earnings Per Share (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 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:
____________________________________________ (a) Amount has been retroactively adjusted to reflect a 1-for-200 (1:200) reverse stock split effective April 14, 2020. See Note 17 for additional information.
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Exploration Expense |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Extractive Industries [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Exploration Expense | Exploration Expense A summary of our exploration expense for the Current Quarter and the Prior Quarter is as follows:
Unproved oil and natural gas properties are periodically assessed for impairment by considering future drilling and exploration plans, results of exploration activities, commodity price outlooks, planned future sales and expiration of all or a portion of the projects. The exploration expense charges during the Current Quarter are the result of non-cash impairment charges in unproved properties, primarily in our Brazos Valley, Powder River Basin, Haynesville and Mid-Continent operating areas.
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Other Operating Expense |
3 Months Ended |
|---|---|
Mar. 31, 2020 | |
| Other Income and Expenses [Abstract] | |
| Other Operating Expenses | Other Operating Expense In the Current Quarter, we terminated certain gathering, processing and transportation contracts and recognized a non-recurring $79 million expense related to the contract terminations. The contract terminations removed approximately $169 million of future commitments related to gathering, processing and transportation agreements. See Note 5 for further discussion of contingencies and commitments. In the Prior Quarter, we recorded approximately $23 million of costs related to our acquisition of WildHorse which consisted of consulting fees, financial advisory fees, legal fees and travel and lodging expenses. In addition, we recorded approximately $38 million of severance expense as a result of the acquisition of WildHorse. A majority of the WildHorse executives and employees were terminated. These executives and employees were entitled to severance benefits in accordance with existing employment agreements.
|
Contingencies and Commitments - Gathering Processing and Transportation Commitments Table (Details) - Gathering, processing and transportation agreement $ in Millions |
Mar. 31, 2020
USD ($)
|
|---|---|
| Other Commitments [Line Items] | |
| Remainder of 2020 | $ 815 |
| 2021 | 986 |
| 2022 | 880 |
| 2023 | 752 |
| 2024 | 681 |
| 2025 – 2034 | 3,479 |
| Total | $ 7,593 |
Earnings Per Share - Additional Information (Details) |
Mar. 31, 2020 |
|---|---|
| 4.50% Cumulative Convertible Preferred Stock | |
| Long-Term Debt Instrument [Line Items] | |
| Interest rate, stated percentage | 4.50% |
| 5.00% (2005B) | |
| Long-Term Debt Instrument [Line Items] | |
| Interest rate, stated percentage | 5.00% |
| 5.75% Cumulative Convertible Non-Voting Preferred Stock (Series A) | |
| Long-Term Debt Instrument [Line Items] | |
| Interest rate, stated percentage | 5.75% |
| 5.75% Cumulative Non-Voting Convertible Preferred Stock | |
| Long-Term Debt Instrument [Line Items] | |
| Interest rate, stated percentage | 5.75% |
| Convertible debt | 5.5% convertible senior notes due 2026 | |
| Long-Term Debt Instrument [Line Items] | |
| Interest rate, stated percentage | 5.50% |
Revenue - Accounts Receivable (Details) - USD ($) $ in Millions |
Mar. 31, 2020 |
Dec. 31, 2019 |
|---|---|---|
| Disaggregation of Revenue [Line Items] | ||
| Allowance for doubtful accounts | $ (24) | $ (21) |
| Total accounts receivable, net | 762 | 990 |
| Oil, natural gas and NGL sales | ||
| Disaggregation of Revenue [Line Items] | ||
| Accounts receivable, gross | 458 | 737 |
| Joint interest | ||
| Disaggregation of Revenue [Line Items] | ||
| Accounts receivable, gross | 178 | 200 |
| Other | ||
| Disaggregation of Revenue [Line Items] | ||
| Accounts receivable, gross | $ 150 | $ 74 |
Derivative and Hedging Activities - Marketing Revenues (Details) - USD ($) $ in Millions |
3 Months Ended | |
|---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|
| Derivative [Line Items] | ||
| Revenues | $ 894 | $ 1,230 |
| Losses on undesignated marketing natural gas derivatives | 907 | (301) |
| Revenues | 2,541 | 2,196 |
| Marketing, Gathering And Compression | Other contract | ||
| Derivative [Line Items] | ||
| Losses on undesignated marketing natural gas derivatives | 0 | (2) |
| Marketing | Marketing, Gathering And Compression | ||
| Derivative [Line Items] | ||
| Revenues | 724 | 1,235 |
| Marketing | ||
| Derivative [Line Items] | ||
| Revenues | 662 | 1,143 |
| Losses on undesignated marketing natural gas derivatives | (2) | |
| Revenues | $ 724 | $ 1,233 |
Derivative and Hedging Activities - Quantitative Disclosures Level 3 (Details) - Energy related derivative $ in Millions |
Mar. 31, 2020
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 | $ 39 |
| 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 | $ (8) |
| Price volatility | Oil | Minimum | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 0.2650 |
| Price volatility | Oil | Maximum | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 2.4241 |
| Price volatility | Oil | Weighted average | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 0.4297 |
| Price volatility | Natural Gas | Minimum | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 0.2056 |
| Price volatility | Natural Gas | Maximum | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 1.4143 |
| Price volatility | Natural Gas | Weighted average | |
| Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | |
| Measurement input | 0.4277 |
Impairments |
3 Months Ended | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2020 | |||||||||||||
| Property, Plant and Equipment [Abstract] | |||||||||||||
| Impairments | Impairments During the Current Quarter, the decrease in demand for crude oil primarily due to COVID-19 and sharp decline in commodity prices related to the combined impact of falling demand and recent increases in production from OPEC+ resulted in decreases in current and expected long-term crude oil and NGL sale prices. These conditions resulted in reductions to the market capitalization of peer companies in the energy industry. We determined these adverse market conditions represent a triggering event to perform an impairment assessment of our long-lived assets used in, and in support of, our operations, including proved oil and gas properties, and our sand mine assets. Proved Oil and Gas Properties Our impairment test involved a Step 1 assessment to determine if the net book value of our proved oil and natural gas properties is expected to be recovered from the estimated undiscounted future cash flows.
Certain oil and gas properties in our Eagle Ford, Brazos Valley, Powder River Basin, and Mid-Continent and other non-core operating areas failed the Step 1 assessment. For these assets, we used a discounted cash flow analysis to estimate fair value. The expected future net cash flows were discounted using a rate of 11%, which we believe represents the estimated weighted average cost of capital of a theoretical market participant. Based on Step 2 of our long-lived assets impairment test, we recognized an $8.446 billion impairment because the carrying value exceeded estimated fair market value as of March 31, 2020.
Sand Mine Our in-field sand mine assets predominately service the oil and gas properties in our Brazos Valley operating area. Based on management’s assumptions and expectations of (i) future commodity prices, (ii) capital investment plans in the Brazos Valley operating area, and (iii) future operating cost of the sand mine, management expects the market for sand to significantly decrease for the foreseeable future. As a result, we recognized a $76 million impairment related to our sand mine assets for the difference between fair value and the carrying value as of March 31, 2020. The inputs used are classified as Level 3 fair value assumptions.
|
Subsequent Events |
3 Months Ended |
|---|---|
Mar. 31, 2020 | |
| Subsequent Events [Abstract] | |
| Subsequent Events | Subsequent Events Reverse Stock Split On April 13, 2020, our Board of Directors and our shareholders approved a 1-for-200 (1:200) reverse stock split of our common stock and a reduction of the total number of authorized shares of our common stock as determined by a formula based on two-thirds of the reverse stock split ratio. The reverse stock split became effective as of the close of business on April 14, 2020. Our common stock began trading on a split-adjusted basis on the NYSE at the market open on April 15, 2020. The par value of the common stock was not adjusted as a result of the reverse stock split. The reverse stock split was intended to, among other things, increase the per share trading price of our common shares to satisfy the $1.00 minimum closing price requirement for continued listing on the NYSE. As a result of the reverse stock split, each 200 pre-split shares of common stock outstanding were automatically combined into one issued and outstanding share of common stock. The fractional shares that resulted from the reverse stock split were canceled by paying cash in lieu of the fair value. The number of outstanding shares of common stock were reduced from approximately 1.957 billion as of April 10, 2020 to approximately 9.784 million shares (without giving effect to the liquidation of fractional shares). The total number of shares of common stock that we are authorized to issue was reduced from 3,000,000,000 to 22,500,000 shares. All share and per share amounts in the accompanying condensed consolidated financial statements and notes thereto were retroactively adjusted for all periods presented to give effect to this reverse stock split, including reclassifying an amount equal to the reduction in par value of our common stock to additional paid-in capital. Preferred Stock Dividend Suspension On April 17, 2020, we announced that we were suspending payment of dividends on each series of our outstanding convertible preferred stock. Suspension of the dividends did not constitute an event of default under any of our debt instruments. Adoption of Rights Plan On April 23, 2020, the Board of Directors of the Company declared a dividend of one preferred share purchase right (a “Right”), payable on May 4, 2020, for each share of common stock, par value $0.01 per share, of the Company (the “Common Stock”) outstanding on May 4, 2020 to the stockholders of record on that date. In connection with the distribution of the Rights, the Company entered into a Section 382 Rights Agreement (the “Rights Agreement”), dated as of April 23, 2020, between the Company and Computershare Trust Company, N.A., as rights agent. Each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series B Preferred Stock, par value $0.01 per share, of the Company at a price of $90.00 subject to adjustment. The purpose of the Rights Agreement is to protect value by preserving the Company’s ability to use its tax attributes (e.g., federal NOLs) to offset potential future income taxes for federal income tax purposes. As of December 31, 2019, the Company had federal NOLs of approximately $7.6 billion available to offset future federal taxable income. The Company’s ability to use its federal NOLs as well as other tax attributes would be substantially limited if it experiences an Ownership Change. The Rights Agreement is intended to reduce the likelihood of an Ownership Change by deterring any person or group of affiliated or associated persons from acquiring beneficial ownership of 4.9% or more of the outstanding shares of Common Stock. The Rights Agreement will expire on the close of business on the day following the certification of the voting results from the Company’s 2021 annual meeting, unless the Company’s shareholders ratify the Rights Agreement at or prior to such meeting, in which case it will continue in effect until April 22, 2023, unless terminated earlier in accordance with its terms.
|
Contingencies and Commitments (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of contractual obligation | The aggregate undiscounted commitments under our gathering, processing and transportation agreements, excluding any reimbursement from working interest and royalty interest owners, credits for third-party volumes or future costs under cost-of-service agreements, are presented below:
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue - Disaggregated Revenue (Details) - USD ($) $ in Millions |
3 Months Ended | |
|---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|
| Disaggregation of Revenue [Line Items] | ||
| Revenues | $ 894 | $ 1,230 |
| Gains (losses) on oil, natural gas and NGL derivatives | 907 | (301) |
| Revenues | 2,541 | 2,196 |
| Oil, natural gas and NGL revenue | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 1,801 | 929 |
| Marketing | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 662 | 1,143 |
| Gains (losses) on oil, natural gas and NGL derivatives | (2) | |
| Revenues | 724 | 1,233 |
| Other marketing revenue | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 62 | 92 |
| Marcellus | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 175 | 302 |
| Haynesville | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 85 | 201 |
| Eagle Ford | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 328 | 425 |
| Brazos Valley | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 180 | 127 |
| Powder River Basin | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 90 | 109 |
| Mid-Continent | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 36 | 66 |
| Oil | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 539 | 566 |
| Gains (losses) on oil, natural gas and NGL derivatives | 839 | (259) |
| Oil | Oil, natural gas and NGL revenue | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 1,378 | 307 |
| Oil | Marketing | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 508 | 613 |
| Gains (losses) on oil, natural gas and NGL derivatives | 0 | |
| Revenues | 569 | 685 |
| Oil | Other marketing revenue | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 61 | 72 |
| Oil | Marcellus | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 0 | 0 |
| Oil | Haynesville | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 0 | 0 |
| Oil | Eagle Ford | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 277 | 331 |
| Oil | Brazos Valley | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 172 | 121 |
| Oil | Powder River Basin | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 68 | 74 |
| Oil | Mid-Continent | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 22 | 40 |
| Natural Gas | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 320 | 595 |
| Gains (losses) on oil, natural gas and NGL derivatives | 68 | (42) |
| Natural Gas | Oil, natural gas and NGL revenue | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 388 | 553 |
| Natural Gas | Marketing | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 124 | 413 |
| Gains (losses) on oil, natural gas and NGL derivatives | (2) | |
| Revenues | 125 | 431 |
| Natural Gas | Other marketing revenue | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 1 | 20 |
| Natural Gas | Marcellus | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 175 | 302 |
| Natural Gas | Haynesville | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 85 | 201 |
| Natural Gas | Eagle Ford | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 31 | 48 |
| Natural Gas | Brazos Valley | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 4 | 4 |
| Natural Gas | Powder River Basin | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 15 | 25 |
| Natural Gas | Mid-Continent | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 10 | 15 |
| NGL | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 35 | 69 |
| Gains (losses) on oil, natural gas and NGL derivatives | 0 | 0 |
| NGL | Oil, natural gas and NGL revenue | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 35 | 69 |
| NGL | Marketing | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 30 | 117 |
| Gains (losses) on oil, natural gas and NGL derivatives | 0 | |
| Revenues | 30 | 117 |
| NGL | Other marketing revenue | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 0 | 0 |
| NGL | Marcellus | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 0 | 0 |
| NGL | Haynesville | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 0 | 0 |
| NGL | Eagle Ford | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 20 | 46 |
| NGL | Brazos Valley | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 4 | 2 |
| NGL | Powder River Basin | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | 7 | 10 |
| NGL | Mid-Continent | ||
| Disaggregation of Revenue [Line Items] | ||
| Revenues | $ 4 | $ 11 |
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Millions |
Total |
TOTAL CHESAPEAKE STOCKHOLDERS’ EQUITY (DEFICIT) |
PREFERRED STOCK: |
COMMON STOCK:(a) |
ADDITIONAL PAID-IN CAPITAL:(a) |
ACCUMULATED DEFICIT: |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): |
TREASURY STOCK – COMMON:(a) |
NONCONTROLLING INTERESTS: |
|||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Chesapeake stockholders’ equity, beginning of period at Dec. 31, 2018 | $ 1,671 | $ 0 | $ 14,387 | $ (13,912) | $ (23) | $ (31) | [1] | |||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
| Common shares issued for WildHorse Merger | 0 | 2,037 | ||||||||||
| Stock-based compensation | 7 | |||||||||||
| Dividends on preferred stock | (23) | |||||||||||
| Net loss attributable to Chesapeake | $ (21) | (21) | ||||||||||
| Hedging activity | 10 | |||||||||||
| Purchase of 17,901 and 12,697 shares for company benefit plans | [1] | (6) | ||||||||||
| Release of 44,126 and 553 shares from company benefit plans | [1] | 1 | ||||||||||
| Chesapeake stockholders’ equity, end of period at Mar. 31, 2019 | $ 4,097 | 0 | 16,408 | (13,933) | (13) | (36) | [1] | |||||
| Stockholders' equity attributable to noncontrolling interest, beginning of period at Dec. 31, 2018 | $ 41 | |||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
| Net loss attributable to noncontrolling interests | 0 | 0 | ||||||||||
| Stockholders' equity attributable to noncontrolling interest, end of period at Mar. 31, 2019 | 41 | |||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
| Total Equity (Deficit) | 4,138 | |||||||||||
| Total Equity (Deficit) | 4,401 | |||||||||||
| Chesapeake stockholders’ equity, beginning of period at Dec. 31, 2019 | 4,364 | $ 1,631 | 0 | 16,973 | (14,220) | 12 | (32) | [1] | ||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
| Common shares issued for WildHorse Merger | 0 | 0 | ||||||||||
| Stock-based compensation | (31) | |||||||||||
| Dividends on preferred stock | (22) | |||||||||||
| Net loss attributable to Chesapeake | (8,297) | (8,297) | ||||||||||
| Hedging activity | 9 | |||||||||||
| Purchase of 17,901 and 12,697 shares for company benefit plans | [1] | (2) | ||||||||||
| Release of 44,126 and 553 shares from company benefit plans | [1] | 34 | ||||||||||
| Chesapeake stockholders’ equity, end of period at Mar. 31, 2020 | (3,945) | $ (3,945) | $ 0 | $ 16,920 | $ (22,517) | $ 21 | $ 0 | [1] | ||||
| Stockholders' equity attributable to noncontrolling interest, beginning of period at Dec. 31, 2019 | 37 | 37 | ||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
| Net loss attributable to noncontrolling interests | 16 | (16) | ||||||||||
| Stockholders' equity attributable to noncontrolling interest, end of period at Mar. 31, 2020 | 21 | $ 21 | ||||||||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
| Total Equity (Deficit) | $ (3,924) | |||||||||||
| ||||||||||||
Contingencies and Commitments - Narrative (Details) - USD ($) |
1 Months Ended | 8 Months Ended | |
|---|---|---|---|
Jan. 05, 2014 |
Feb. 28, 2019 |
Aug. 09, 2018 |
|
| Commonwealth of Pennsylvania, royalty underpayment | Settled litigation | |||
| Loss Contingencies [Line Items] | |||
| Settlement amount | $ 36,000,000 | ||
| 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 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) $ in Millions |
Mar. 31, 2020
USD ($)
$ / shares
shares
|
Dec. 31, 2019
USD ($)
$ / shares
shares
|
|---|---|---|
| Preferred stock, par value (usd per share) | $ / shares | $ 0.01 | $ 0.01 |
| Preferred stock, shares authorized (shares) | shares | 20,000,000 | 20,000,000 |
| Preferred stock, shares outstanding (shares) | shares | 5,563,458 | 5,563,458 |
| Common stock, par value (usd per share) | $ / shares | $ 0.01 | $ 0.01 |
| Common stock, shares authorized (shares) | shares | 22,500,000 | 15,000,000 |
| Common stock, shares issued (shares) | shares | 9,783,773 | 9,772,793 |
| Treasury stock, common shares (shares) | shares | 0 | 26,224 |
| VIE, cash and cash equivalents | $ 82 | $ 6 |
| VIE, proved oil and natural gas properties | 31,251 | 30,765 |
| VIE, accumulated depreciation, depletion and amortization | (29,110) | (20,002) |
| VIE, other current liabilities | 1,152 | 1,432 |
| VIE | ||
| VIE, cash and cash equivalents | 2 | 2 |
| VIE, proved oil and natural gas properties | 755 | 755 |
| VIE, accumulated depreciation, depletion and amortization | (748) | (713) |
| VIE, other current liabilities | $ 1 | $ 1 |
Debt - Notes Repurchased (Details) $ in Millions |
3 Months Ended |
|---|---|
|
Mar. 31, 2020
USD ($)
| |
| Long-Term Debt Instrument [Line Items] | |
| Debt instrument, repurchased face amount | $ 156 |
| Senior notes | |
| Long-Term Debt Instrument [Line Items] | |
| Debt instrument, repurchased face amount | 156 |
| Debt repurchased, principal | 93 |
| Gain on repurchase of debt | 63 |
| Senior notes | 6.625% senior notes due 2020 | |
| Long-Term Debt Instrument [Line Items] | |
| Debt instrument, repurchased face amount | 31 |
| Senior notes | 6.875% senior notes due 2020 | |
| Long-Term Debt Instrument [Line Items] | |
| Debt instrument, repurchased face amount | 17 |
| Senior notes | 6.125% senior notes due 2021 | |
| Long-Term Debt Instrument [Line Items] | |
| Debt instrument, repurchased face amount | 66 |
| Senior notes | 5.375% senior notes due 2021 | |
| Long-Term Debt Instrument [Line Items] | |
| Debt instrument, repurchased face amount | $ 42 |
Derivative and Hedging Activities - Cash Flow Hedges Components of AOCI (Details) - USD ($) $ in Millions |
3 Months Ended | |||
|---|---|---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|||
| AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
| AOCI, after tax, beginning of period | $ 12 | |||
| Losses reclassified to income, after tax | [1] | 9 | $ 10 | |
| AOCI, after tax, end of period | 21 | |||
| Cash flow hedging | ||||
| AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
| AOCI, before tax, beginning of period | (45) | (80) | ||
| AOCI, after tax, beginning of period | 12 | (23) | ||
| Losses reclassified to income, before tax | 9 | |||
| Losses reclassified to income, after tax | 9 | |||
| Losses reclassified to income, before tax | 10 | |||
| Losses reclassified to income, after tax | 10 | |||
| AOCI, before tax, end of period | (36) | (70) | ||
| AOCI, after tax, end of period | $ 21 | $ (13) | ||
| ||||
Exploration Expense (Details) - USD ($) $ in Millions |
3 Months Ended | |
|---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|
| Extractive Industries [Abstract] | ||
| Impairments of unproved properties | $ 272 | $ 18 |
| Dry hole expense | 7 | 0 |
| Geological and geophysical expense and other | 3 | 6 |
| Exploration expense | $ 282 | $ 24 |
Equity (Details) |
3 Months Ended | |||
|---|---|---|---|---|
Apr. 14, 2020 |
Apr. 13, 2020 |
Mar. 31, 2020
shares
|
Mar. 31, 2019
shares
|
|
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
| Common stock, shares issued, beginning balance (shares) | 9,772,793 | 4,568,000 | ||
| Restricted stock issuances (net of forfeitures and cancellations) | 11,000 | 13,000 | ||
| Common stock, shares issued, ending balance (shares) | 9,783,773 | 8,168,000 | ||
| Subsequent Event | COMMON STOCK | ||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
| Stock split, conversion ratio | 0.005 | 0.005 | ||
| Wildhorse Resource Development Corporation | ||||
| Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
| Common shares issued for WildHorse Merger | 0 | 3,587,000 | ||
Share-Based Compensation - Equity-Classified Compensation Table (Details) - Restricted stock and stock options - USD ($) $ in Millions |
3 Months Ended | |
|---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation expense | $ 6 | $ 8 |
| General and administrative expenses | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation expense | 4 | 6 |
| Oil and natural gas properties | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation expense | 1 | 1 |
| Oil, natural gas and NGL production expenses | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation expense | $ 1 | $ 1 |
Derivative and Hedging Activities - Derivative Instruments (Details) MMBbls in Millions, Bcf in Millions, $ in Millions |
3 Months Ended | 12 Months Ended |
|---|---|---|
|
Mar. 31, 2020
USD ($)
Bcf
MMBbls
|
Dec. 31, 2019
USD ($)
Bcf
MMBbls
|
|
| Derivative [Line Items] | ||
| Derivative assets (liabilities), at fair value, net | $ 862 | $ 130 |
| Energy related derivative | ||
| Derivative [Line Items] | ||
| Derivative assets (liabilities), at fair value, net | $ 862 | $ 130 |
| Energy related derivative | Oil | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | MMBbls | 41 | 34 |
| Derivative assets (liabilities), at fair value, net | $ 717 | $ 5 |
| Energy related derivative | Oil | Fixed-price swaps | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | MMBbls | 21 | 24 |
| Derivative assets (liabilities), at fair value, net | $ 640 | $ (7) |
| Energy related derivative | Oil | Call options | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | MMBbls | 9 | 0 |
| Derivative assets (liabilities), at fair value, net | $ (9) | $ 0 |
| Energy related derivative | Oil | Collars | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | MMBbls | 1 | 2 |
| Derivative assets (liabilities), at fair value, net | $ 48 | $ 14 |
| Energy related derivative | Oil | Basis protection swaps | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | MMBbls | 10 | 8 |
| Derivative assets (liabilities), at fair value, net | $ 38 | $ (2) |
| Energy related derivative | Natural Gas | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 481 | 346 |
| Derivative assets (liabilities), at fair value, net | $ 145 | $ 125 |
| Energy related derivative | Natural Gas | Fixed-price swaps | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 199 | 265 |
| Derivative assets (liabilities), at fair value, net | $ 152 | $ 125 |
| Energy related derivative | Natural Gas | Call options | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 113 | 22 |
| Derivative assets (liabilities), at fair value, net | $ (19) | $ 0 |
| Energy related derivative | Natural Gas | Call swaptions | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 29 | 29 |
| Derivative assets (liabilities), at fair value, net | $ (4) | $ (2) |
| Energy related derivative | Natural Gas | Put spreads | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 94 | 0 |
| Derivative assets (liabilities), at fair value, net | $ 15 | $ 0 |
| Energy related derivative | Natural Gas | Basis protection swaps | ||
| Derivative [Line Items] | ||
| Derivative, nonmonetary notional amount, volume | Bcf | 46 | 30 |
| Derivative assets (liabilities), at fair value, net | $ 1 | $ 2 |
Subsequent Events (Details) $ / shares in Units, $ in Billions |
12 Months Ended | |||||
|---|---|---|---|---|---|---|
|
Apr. 23, 2020
$ / shares
|
Apr. 14, 2020 |
Apr. 13, 2020
shares
|
Dec. 31, 2019
USD ($)
$ / shares
shares
|
Apr. 10, 2020
shares
|
Mar. 31, 2020
$ / shares
shares
|
|
| Subsequent Event [Line Items] | ||||||
| Common stock, shares authorized (shares) | shares | 15,000,000 | 22,500,000 | ||||
| Common stock, par value (usd per share) | $ / shares | $ 0.01 | $ 0.01 | ||||
| Preferred stock, par value (usd per share) | $ / shares | $ 0.01 | $ 0.01 | ||||
| Net operating loss, domestic | $ | $ 7.6 | |||||
| Subsequent Event | ||||||
| Subsequent Event [Line Items] | ||||||
| Common shares, outstanding (in shares) | shares | 1,957,000,000 | |||||
| Common stock, par value (usd per share) | $ / shares | $ 0.01 | |||||
| Maximum beneficial ownership, percent | 4.90% | |||||
| Subsequent Event | Preferred Class B | ||||||
| Subsequent Event [Line Items] | ||||||
| Preferred stock, par value (usd per share) | $ / shares | $ 0.01 | |||||
| Share price (in dollars per share) | $ / shares | $ 90.00 | |||||
| Subsequent Event | COMMON STOCK | ||||||
| Subsequent Event [Line Items] | ||||||
| Stock split, conversion ratio | 0.005 | 0.005 | ||||
| Reverse stock split, number of shares (in shares) | shares | 9,784,000 | |||||
| Shares authorized prior to reverse stock split (in shares) | shares | 3,000,000,000 | |||||
| Common stock, shares authorized (shares) | shares | 22,500,000 | |||||
| Subsequent Event | PREFERRED STOCK | Preferred Class B | ||||||
| Subsequent Event [Line Items] | ||||||
| Share purchase ratio | 0.10% |
Contingencies and Commitments |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 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. 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 lawsuits 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. We intend to vigorously defend these claims. 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 $36 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. 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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Equity |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity | Equity Common Stock A summary of the changes in our common shares issued is detailed below.
____________________________________________
(b)
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Debt - Long-Term Debt Table (Details) - USD ($) |
Mar. 31, 2020 |
Dec. 31, 2019 |
|---|---|---|
| Long-Term Debt Instrument [Line Items] | ||
| Principal amount | $ 9,070,000,000 | $ 8,916,000,000 |
| Carrying amount | 9,583,000,000 | 9,458,000,000 |
| Debt issuance costs | (40,000,000) | (44,000,000) |
| Debt, current | (420,000,000) | (385,000,000) |
| Current maturities of long-term debt, net | (420,000,000) | (385,000,000) |
| Long-term debt, fair value | 8,650,000,000 | 8,531,000,000 |
| Long-term debt, net | 9,163,000,000 | 9,073,000,000 |
| Line of credit | Revolving credit facility | Revolving credit facility | ||
| Long-Term Debt Instrument [Line Items] | ||
| Principal amount | 1,900,000,000 | 1,590,000,000 |
| Chesapeake revolving credit facility | 1,900,000,000 | 1,590,000,000 |
| Term loan | ||
| Long-Term Debt Instrument [Line Items] | ||
| Principal amount | 1,500,000,000 | 1,500,000,000 |
| Carrying amount | $ 1,472,000,000 | 1,470,000,000 |
| Senior notes | 11.5% senior secured second lien notes due 2025 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 11.50% | |
| Principal amount | $ 2,330,000,000 | 2,330,000,000 |
| Carrying amount | $ 3,205,000,000 | 3,248,000,000 |
| Senior notes | 6.625% senior notes due 2020 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 6.625% | |
| Principal amount | $ 177,000,000 | 208,000,000 |
| Carrying amount | $ 177,000,000 | 208,000,000 |
| Senior notes | 6.875% senior notes due 2020 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 6.875% | |
| Principal amount | $ 76,000,000 | 93,000,000 |
| Carrying amount | $ 76,000,000 | 93,000,000 |
| Senior notes | 6.125% senior notes due 2021 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 6.125% | |
| Principal amount | $ 167,000,000 | 167,000,000 |
| Carrying amount | $ 167,000,000 | 167,000,000 |
| Senior notes | 5.375% senior notes due 2021 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 5.375% | |
| Principal amount | $ 127,000,000 | 127,000,000 |
| Carrying amount | $ 127,000,000 | 127,000,000 |
| Senior notes | 4.875% senior notes due 2022 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 4.875% | |
| Principal amount | $ 272,000,000 | 338,000,000 |
| Carrying amount | $ 272,000,000 | 338,000,000 |
| Senior notes | 5.75% senior notes due 2023 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 5.75% | |
| Principal amount | $ 167,000,000 | 209,000,000 |
| Carrying amount | $ 167,000,000 | 209,000,000 |
| Senior notes | 7.00% senior notes due 2024 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 7.00% | |
| Principal amount | $ 624,000,000 | 624,000,000 |
| Carrying amount | $ 624,000,000 | 624,000,000 |
| Senior notes | 6.875% senior notes due 2025 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 6.875% | |
| Principal amount | $ 2,000,000 | 2,000,000 |
| Carrying amount | $ 2,000,000 | 2,000,000 |
| Senior notes | 8.00% senior notes due 2025 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 8.00% | |
| Principal amount | $ 246,000,000 | 246,000,000 |
| Carrying amount | 245,000,000 | 245,000,000 |
| Senior notes | 7.5% senior notes due 2026 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Principal amount | 119,000,000 | 119,000,000 |
| Carrying amount | 119,000,000 | 119,000,000 |
| Senior notes | 8.00% senior notes due 2026 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Principal amount | 46,000,000 | 46,000,000 |
| Carrying amount | $ 44,000,000 | 44,000,000 |
| Senior notes | 8.00% senior notes due 2027 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 8.00% | |
| Principal amount | $ 253,000,000 | 253,000,000 |
| Carrying amount | $ 253,000,000 | 253,000,000 |
| Convertible debt | 5.5% convertible senior notes due 2026 | ||
| Long-Term Debt Instrument [Line Items] | ||
| Interest rate, stated percentage | 5.50% | |
| Principal amount | $ 1,064,000,000 | 1,064,000,000 |
| Carrying amount | $ 773,000,000 | $ 765,000,000 |
| 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% |
Derivative and Hedging Activities (Tables) |
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Mar. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 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 March 31, 2020 and December 31, 2019 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 March 31, 2020 and December 31, 2019 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 and the Prior Quarter are presented below:
The components of marketing revenues for the Current Quarter and the Prior Quarter 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 March 31, 2020 and December 31, 2019:
A summary of the changes in the fair values of our financial assets (liabilities) classified as Level 3 during the Current Quarter and the Prior Quarter is presented below:
___________________________________________
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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 March 31, 2020:
____________________________________________ (a) Weighted average volatility is weighted by relative volume.
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Other Liabilities (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other Liabilities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other current liabilities | Other current liabilities as of March 31, 2020 and December 31, 2019 are detailed below:
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| Other long-term liabilities | Other long-term liabilities as of March 31, 2020 and December 31, 2019 are detailed below:
____________________________________________
(b) In the Current Quarter, we terminated our nonqualified deferred compensation plan. Accordingly, we derecognized the asset associated with the plan after the participants’ investments were liquidated. The cash was distributed to the participants and we extinguished the corresponding $43 million accrued liability.
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Investments |
3 Months Ended |
|---|---|
Mar. 31, 2020 | |
| Equity Method Investments and Joint Ventures [Abstract] | |
| Investments | Investments In the Current Quarter, the hydraulic fracturing industry experienced challenging operating conditions resulting in the current fair value of our investment in FTS International, Inc. (NYSE: FTSI) falling below book value of $23 million and remaining below that value as of the end of the Current Quarter. Based on FTSI’s operating results and FTSI’s share price of $0.22 per share as of March 31, 2020, we determined that the reduction in fair value is other-than-temporary, and recognized an impairment of our entire investment in FTSI of $23 million.
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Debt (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of long-term debt | Our long-term debt consisted of the following as of March 31, 2020 and December 31, 2019:
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| Schedule of debt repurchased | In the Current Quarter, we repurchased approximately $156 million aggregate principal amount of the following senior notes for $93 million and recorded an aggregate gain of approximately $63 million.
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| Schedule of fair value of debt | Fair value is compared to the carrying value in the table below:
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Capitalized Exploratory Well Costs (Details) |
3 Months Ended |
|---|---|
|
Mar. 31, 2020
USD ($)
| |
| Changes in Capitalized Well Costs | |
| Beginning balance | $ 7,000,000 |
| Charges to exploration expense | (7,000,000) |
| Ending balance | 0 |
| Capitalized exploratory well costs that have been capitalized for period greater than one year | $ 0 |
Derivative and Hedging Activities - Oil, Natural Gas and NGL Revenues (Details) - USD ($) $ in Millions |
3 Months Ended | |
|---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|
| Derivative [Line Items] | ||
| Gains (losses) on undesignated oil, natural gas and NGL derivatives | $ 907 | $ (301) |
| Revenues | 2,541 | 2,196 |
| Oil, natural gas and NGL sales | ||
| Derivative [Line Items] | ||
| Losses on terminated cash flow hedges | (9) | (10) |
| 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 | 916 | (291) |
| Oil, natural gas and NGL | ||
| Derivative [Line Items] | ||
| Oil, natural gas and NGL revenues | 894 | 1,230 |
| Revenues | $ 1,801 | $ 929 |
Derivative and Hedging Activities - Fair Value Level 3 Measurements (Details) - USD ($) $ in Millions |
3 Months Ended | |
|---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|
| Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||
| Derivative assets (liabilities), at fair value, net, beginning of period | $ 130 | |
| Derivative assets (liabilities), at fair value, net, end of period | 862 | |
| 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 | 130 | |
| Derivative assets (liabilities), at fair value, net, end of period | 862 | |
| 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 | 12 | |
| Derivative assets (liabilities), at fair value, net, end of period | 31 | |
| 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 | 12 | $ 87 |
| Gains (loses) included in earnings | 28 | (88) |
| Settlements | (9) | 4 |
| Derivative assets (liabilities), at fair value, net, end of period | 31 | 3 |
| 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 | 28 | (88) |
| Change in unrealized gains (losses) related to assets still held at reporting date | 19 | (84) |
| 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 | 0 | 7 |
| Gains (loses) included in earnings | 0 | 0 |
| Settlements | 0 | 0 |
| Derivative assets (liabilities), at fair value, net, end of period | $ 0 | $ 7 |
Basis of Presentation and Summary of Significant Accounting Policies |
3 Months Ended |
|---|---|
Mar. 31, 2020 | |
| Accounting Policies [Abstract] | |
| Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The accompanying condensed consolidated financial statements of Chesapeake were prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the SEC. Pursuant to such rules and regulations, certain disclosures have been condensed or omitted. This Form 10-Q relates to the three months ended March 31, 2020 (the “Current Quarter”) and the three months ended March 31, 2019 (the “Prior Quarter”). Our annual report on Form 10-K for the year ended December 31, 2019 (“2019 Form 10-K”) should be read in conjunction with this Form 10-Q. The accompanying condensed consolidated financial statements reflect all normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of our condensed consolidated financial statements and accompanying notes and include the accounts of our direct and indirect wholly owned subsidiaries and entities in which we have a controlling financial interest. Intercompany accounts and balances have been eliminated. Risks and Uncertainties On March 11, 2020, the World Health Organization declared the ongoing coronavirus (COVID-19) outbreak a pandemic and recommended containment and mitigation measures worldwide. The pandemic has reached more than 200 countries and territories and has resulted in widespread adverse impacts on the global economy and on our customers and other parties with whom we have business relations. To date, we have experienced limited operational impacts as a result of the restrictions from working remotely or COVID-19 directly. As an essential business under the guidelines issued by each of the states in which we operate, we have been allowed to continue operations, although for the health and safety of our employees we chose to have our non-essential personnel work remotely. As a result, since mid-March, we have restricted access to all of our offices and have directed employees to work remotely to the extent possible. Those employees who are unable to work remotely are being closely monitored and are taking safety precautions to minimize the risk of exposure. These restrictions have allowed us to maintain the engagement and connectivity of our personnel, as well as minimize the number of employees required in the office and field. However, due to severe impacts from the global COVID-19 pandemic on the global demand for oil and natural gas, operating results for the three months ended March 31, 2020 are not necessarily indicative of financial results for the entire year as only one month of the Current Quarter was impacted by COVID-19 and the related economic volatility. Moreover, future operations could be negatively affected if a significant number of our employees are quarantined as a result of exposure to the virus. There is considerable uncertainty regarding the extent to which COVID-19 will continue to spread and the extent and duration of governmental and other measures implemented to try to slow the spread of the virus, such as large-scale travel bans and restrictions, border closures, quarantines, shelter-in-place orders and business and government shutdowns. One of the largest impacts of the pandemic has been a significant reduction in global demand for oil and, to a lesser extent, natural gas. This significant decline in demand has been met with a sharp decline in oil prices following the announcement of price reductions and production increases in March 2020 by members of the Organization of Petroleum Exporting Countries (OPEC+) and other foreign, oil-exporting countries. The resulting supply/demand imbalance is having disruptive impacts on the oil and natural gas exploration and production industry and on other industries that serve exploration and production companies. These industry conditions, coupled with those resulting from the COVID-19 pandemic, are expected to lead to significant global economic contraction generally and in our industry in particular. Oil and natural gas prices have historically been volatile; however, the volatility in the prices for these commodities has substantially increased as a result of COVID-19 and the OPEC+ decisions mentioned above. While an agreement to cut production has since been announced by OPEC+ and its allies, the situation, coupled with the impact of COVID-19, has continued to result in a significant downturn in the oil and gas industry. Oil prices declined sharply in April 2020 and remain volatile. Strip pricing for natural gas has increased as a result of the oil price war; however, the impact of these recent developments and our business are unpredictable. We expect to see continued volatility in oil and natural gas prices for the foreseeable future, and such volatility, combined with the current depressed prices, has impacted and is expected to continue to adversely impact our business. A continued low level of demand or prices for oil and natural gas or otherwise would have a continued material adverse effect on our business, cash flows, liquidity, financial condition and results of operations. We cannot predict the full impact that COVID-19 or the significant disruption and volatility currently being experienced in the oil and natural gas markets will have on our business, cash flows, liquidity, financial condition and results of operations at this time due to numerous uncertainties. The ultimate impacts will depend on future developments, including the ultimate geographic spread of the virus, the consequences of governmental and other measures designed to prevent the spread of the virus, the development of effective treatments, the duration of the outbreak, actions taken by members of OPEC+ and other foreign, oil-exporting countries, governmental authorities, customers and other third parties, workforce availability, and the timing and extent to which normal economic and operating conditions resume. Reverse Stock Split On April 13, 2020, our Board of Directors and our shareholders approved a 1-for-200 (1:200) reverse stock split of our common stock and a reduction in the total number of authorized shares of our common stock as determined by a formula based on two-thirds of the reverse stock split ratio. The reverse stock split became effective as of the close of business on April 14, 2020. Our common stock began trading on a split-adjusted basis on the New York Stock Exchange (NYSE) at the market open on April 15, 2020. The par value of the common stock was not adjusted as a result of the reverse stock split. All share and per share data have been retroactively adjusted to reflect this reverse stock split, including reclassifying an amount equal to the reduction in par value of our common stock to additional paid-in capital. See Note 17 for additional information.
|
Other Liabilities - Current Table (Details) - USD ($) $ in Millions |
Mar. 31, 2020 |
Dec. 31, 2019 |
|---|---|---|
| Other Liabilities Disclosure [Abstract] | ||
| Revenues and royalties due others | $ 396 | $ 516 |
| Accrued drilling and production costs | 260 | 326 |
| Joint interest prepayments received | 57 | 52 |
| VPP deferred revenue | 50 | 55 |
| Accrued compensation and benefits | 56 | 156 |
| Other accrued taxes | 132 | 150 |
| Other | 201 | 177 |
| Total other current liabilities | $ 1,152 | $ 1,432 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions |
3 Months Ended | |||
|---|---|---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|||
| Statement of Comprehensive Income [Abstract] | ||||
| NET LOSS | $ (8,313) | $ (21) | ||
| OTHER COMPREHENSIVE INCOME, NET OF INCOME TAX: | ||||
| Reclassification of losses on settled derivative instruments | [1] | 9 | 10 | |
| Other Comprehensive Income | 9 | 10 | ||
| COMPREHENSIVE LOSS | (8,304) | (11) | ||
| COMPREHENSIVE LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS | 16 | 0 | ||
| COMPREHENSIVE LOSS ATTRIBUTABLE TO CHESAPEAKE | $ (8,288) | $ (11) | ||
| ||||
Debt - Narrative (Details) |
Dec. 03, 2019
USD ($)
|
Feb. 01, 2019 |
Jun. 30, 2022 |
Mar. 31, 2022 |
Dec. 31, 2021 |
Mar. 31, 2020
USD ($)
|
Dec. 31, 2019
USD ($)
|
Dec. 02, 2019
USD ($)
|
|---|---|---|---|---|---|---|---|---|
| Long-Term Debt Instrument [Line Items] | ||||||||
| Debt instrument, principal amount | $ 9,070,000,000 | $ 8,916,000,000 | ||||||
| Revolving credit facility | Revolving credit facility | ||||||||
| Long-Term Debt Instrument [Line Items] | ||||||||
| Line of credit facility, maximum borrowing capacity | $ 1,500,000,000 | 3,000,000,000.0 | $ 1,000,000,000 | |||||
| Line of credit facility, maximum borrowing capacity, increased maximum | 4,000,000,000.0 | |||||||
| Letters of credit outstanding, amount | 89,000,000 | |||||||
| Borrowing base rate reduction | 25.00% | |||||||
| Applicable margin increase | 0.0001 | |||||||
| Covenant, liquidity | $ 250,000,000 | |||||||
| Leverage ratio | 2.50 | |||||||
| Covenant, cash proceeds | $ 50,000,000 | |||||||
| Revolving credit facility | Revolving credit facility | Forecast | ||||||||
| Long-Term Debt Instrument [Line Items] | ||||||||
| Leverage ratio | 4.00 | 4.25 | 4.50 | |||||
| Revolving credit facility | Revolving credit facility | Alternative Base Rate (ABR) | Minimum | ||||||||
| Long-Term Debt Instrument [Line Items] | ||||||||
| Variable rate percentage | 1.50% | |||||||
| Revolving credit facility | Revolving credit facility | Alternative Base Rate (ABR) | Maximum | ||||||||
| Long-Term Debt Instrument [Line Items] | ||||||||
| Variable rate percentage | 2.50% | |||||||
| Revolving credit facility | Revolving credit facility | London Interbank Offered Rate (LIBOR) | Minimum | ||||||||
| Long-Term Debt Instrument [Line Items] | ||||||||
| Variable rate percentage | 2.50% | |||||||
| Revolving credit facility | Revolving credit facility | London Interbank Offered Rate (LIBOR) | Maximum | ||||||||
| Long-Term Debt Instrument [Line Items] | ||||||||
| Variable rate percentage | 3.50% | |||||||
| Revolving credit facility | Revolving credit facility | Line of credit | ||||||||
| Long-Term Debt Instrument [Line Items] | ||||||||
| Debt instrument, principal amount | $ 1,900,000,000 | $ 1,590,000,000 |
Cover Page - shares |
3 Months Ended | |
|---|---|---|
Mar. 31, 2020 |
May 07, 2020 |
|
| Entity Information [Line Items] | ||
| Document Type | 10-Q | |
| Document Quarterly Report | true | |
| Document Period End Date | Mar. 31, 2020 | |
| Document Transition Report | false | |
| Entity File Number | 1-13726 | |
| Entity Registrant Name | CHESAPEAKE ENERGY CORPORATION | |
| Entity Incorporation, State or Country Code | OK | |
| Entity Tax Identification Number | 73-1395733 | |
| Entity Address, Address Line One | 6100 North Western Avenue, | |
| Entity Address, City or Town | Oklahoma City, | |
| Entity Address, State or Province | OK | |
| Entity Address, Postal Zip Code | 73118 | |
| City Area Code | (405) | |
| Local Phone Number | 848-8000 | |
| Entity Current Reporting Status | Yes | |
| Entity Interactive Data Current | Yes | |
| Entity Filer Category | Large Accelerated Filer | |
| Entity Small Business | false | |
| Entity Emerging Growth Company | false | |
| Entity Shell Company | false | |
| Entity Common Stock, Shares Outstanding | 9,783,101 | |
| Amendment Flag | false | |
| Document Fiscal Year Focus | 2020 | |
| Document Fiscal Period Focus | Q1 | |
| Entity Central Index Key | 0000895126 | |
| Current Fiscal Year End Date | --12-31 | |
| Common Stock, par value $0.01 | ||
| Entity Information [Line Items] | ||
| Title of 12(b) Security | Common Stock, par value $0.01 | |
| Trading Symbol | CHK | |
| Security Exchange Name | NYSE | |
| 6.625% Senior Notes due 2020 | ||
| Entity Information [Line Items] | ||
| Title of 12(b) Security | 6.625% Senior Notes due 2020 | |
| Trading Symbol | CHK20A | |
| Security Exchange Name | NYSE | |
| 6.875% Senior Notes due 2020 | ||
| Entity Information [Line Items] | ||
| Title of 12(b) Security | 6.875% Senior Notes due 2020 | |
| Trading Symbol | CHK20 | |
| Security Exchange Name | NYSE | |
| 6.125% Senior Notes due 2021 | ||
| Entity Information [Line Items] | ||
| Title of 12(b) Security | 6.125% Senior Notes due 2021 | |
| Trading Symbol | CHK21 | |
| Security Exchange Name | NYSE | |
| 5.375% Senior Notes due 2021 | ||
| Entity Information [Line Items] | ||
| Title of 12(b) Security | 5.375% Senior Notes due 2021 | |
| Trading Symbol | CHK21A | |
| Security Exchange Name | NYSE | |
| 4.875% Senior Notes due 2022 | ||
| Entity Information [Line Items] | ||
| Title of 12(b) Security | 4.875% Senior Notes due 2022 | |
| Trading Symbol | CHK22 | |
| Security Exchange Name | NYSE | |
| 5.75% Senior Notes due 2023 | ||
| Entity Information [Line Items] | ||
| Title of 12(b) Security | 5.75% Senior Notes due 2023 | |
| Trading Symbol | CHK23 | |
| Security Exchange Name | NYSE | |
| 4.50% Cumulative Convertible Preferred Stock | ||
| Entity Information [Line Items] | ||
| Title of 12(b) Security | 4.5% Cumulative Convertible Preferred Stock | |
| Trading Symbol | CHK Pr D | |
| Security Exchange Name | NYSE |
Investments (Details) - FTS International, Inc. $ / shares in Units, $ in Millions |
3 Months Ended |
|---|---|
|
Mar. 31, 2020
USD ($)
$ / shares
| |
| Schedule of Equity Method Investments [Line Items] | |
| Book value | $ 23 |
| Share price (in dollars per share) | $ / shares | $ 0.22 |
| Other than temporary impairment | $ 23 |
Share-Based Compensation - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 12 Months Ended |
|---|---|---|
Mar. 31, 2020 |
Dec. 31, 2018 |
|
| Participating securities | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Intrinsic value of restricted stock, vested | $ 1 | |
| Unrecognized compensation expense | $ 18 | |
| Share-based compensation expense, weighted average period for recognition | 2 years 1 month 24 days | |
| Stock option | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation expense, weighted average period for recognition | 1 year 4 months 6 days | |
| Unrecognized compensation expense | $ 3 | |
| 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 payout percentage | 0.00% | |
| Performance Share Units | Maximum | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Performance share units payout percentage | 200.00% | |
| Performance Share Units | Management | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| 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% | |
| Performance share units payout percentage | 200.00% | |
| 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 Compensation Table (Details) - Performance Share Units - USD ($) $ in Millions |
3 Months Ended | |
|---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation expense | $ (4) | $ 14 |
| General and administrative expenses | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation expense | (3) | 9 |
| Oil and natural gas properties | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation expense | 0 | 1 |
| Oil, natural gas and NGL production expenses | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation expense | (1) | 3 |
| Exploration expenses | ||
| Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
| Share-based compensation expense | $ 0 | $ 1 |