Chesapeake Energy Cuts 2015 Capex, Production Outlook

Chesapeake Energy Corp. cut its outlook for 2015 capital expenditures in response to continued weak commodity prices. The oil and natural-gas producer now budgets capex of $3.5 billion to $4 billion, down from a previous estimate of $4 billion to $4.5 billion. The company now plans to operate 25 to 35 rigs in 2015, less than half the 2014 average of 64 rigs. As a result, Chesapeake lowered its 2015 targeted production to 231 million to 236 million barrels of oil equivalent, which is 1% to 3% above 2014. "We entered 2015 with a strong liquidity position and we intend to manage it prudently," said Chief Executive Doug Lawler. "In response to continued weak commodity prices, we are further reducing capital expenditures and associated drilling activity." The stock, which was unchanged in after-hours trade, has tumbled 28% so far this year, while the S&P 500 has gained 2.2%.