(MENAFN) Chesapeake Energy Corp, US second largest natural gas producer, plans to give up its pipeline and related assets to Global Infrastructure Partners (GIP) for more than USD4 billion, Reuters reported.
The company seeks to plug an estimated USD10 billion funding shortfall, and is trying to convince its shareholders that it is still a good investment despite steep drops in profits and corporate governance scandals centered around Chief Executive Officer Aubrey McClendon.
A decline in natural gas prices trimmed Chesapeake's earnings, putting the company under pressure to sell assets and cut spending to reduce debt.
It said it would sell its limited partner units and general partner interests in Chesapeake Midstream Partners LP to GIP for USD2 billion.
Under the deal, GIP will own all of the general partner and 69 percent of the limited partner units.
The company also agreed with Chesapeake Midstream Partners to sell certain Mid-Continent gathering and processing assets.
The company is also negotiating with GIP to sell its stake in wholly owned subsidiary Chesapeake Midstream Development LP.
Chesapeake is also considering the sale of its 1.5 million acres of lease holdings in the oil-rich Permian basin and about 337,000 acres in Ohio, and is also trying to find a joint venture partner in the liquids-rich Mississippi Lime basin.
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