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Chesapeake gives no target date for finding a permanent CEO

BY BEN LEFEBVRE

OKLAHOMA CITY -- Chesapeake Energy acting CEO declined to say when the company expects to have a permanent CEO to succeed Aubrey McClendon.

Mr. McClendon officially stepped down as CEO. Chesapeake has been searching for a new CEO since January after Mr. McClendon agreed to leave the company he helped found, citing "philosophical differences" with board members installed by activist shareholders.

Chesapeake had been close to landing a new CEO before an agreement fell apart in late negotiations, a person familiar with the company' s inner workings had said. Chesapeake then named COO Steve Dixon as acting CEO, working in tandem with CFO Domenic J. Dell' Osso and Chairman Archie W. Dunham in a newly established office of the chairman.

Speaking with investment analysts, Mr. Dixon declined to say when Chesapeake might have a permanent  CEO in place. He also declined to address reports that Chesapeake' s negotiations with an unnamed candidate fell apart last week.

"Those are speculations and we won' t address that" he said.

The board' s delay in announcing a new CEO doesn' t bode ill for the company, which will have to find someone with experience running a large oil and gas production business and who will agree to move to the company' s Oklahoma City headquarters, said Morningstar analyst Mark Hanson.

"I don' t think it' s a negative for Chesapeake investors that a CEO hasn' t been found" Mr. Hanson said. "Being prudent is a good thing."

Chesapeake holds drilling rights to some of the most prolific sources of oil and gas in the United States. But it has been battered by natural gas prices that last year sank to their lowest level in more than a decade, forcing the company to sell assets to pay for its operations.

Chesapeake has since resorted to selling assets to keep itself afloat. The company is now focusing on selling smaller packages of acres than on blockbuster, multimillion dollar deals that had been announced under Mr. McClendon' s stewardship.

Chesapeake has already announced $1.5 billion in asset sales this year and says more deals will follow as rising natural gas prices have made its acres more attractive to potential buyers.

Natural gas prices settled above $4 a million British thermal units last week, the first time they have done so since August 2011.

"There' s certainly sentiment in the market that gas has bottomed and is on the way up" Mr. Dixon said.

Dow Jones Newswires

04/01/2013

 

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