Chesapeake Energy on Tuesday blamed many of its recent woes on an "unprecedented negative media campaign" and vowed that its continuing shift from natural gas to liquids production would "carry the day."
In an investor presentation released at the UBS analyst conference in Austin, Texas, the Oklahoma City-based producer said it has over the past five weeks "withstood an unprecedented negative media campaign."
The presentation, which apparently referenced unflattering press reports about the company's financial situation and the activities of its CEO Aubrey McClendon, stated that "while damaging in the short run to our reputation, these attacks have failed, and will continue to fail, to reduce the value of the company's assets and our long-term attractiveness to investors."
Jeff Mobley, Chesapeake's senior vice president of investor relations, assured the analysts that the company was "asset rich," and was moving forward with its forays into liquids-rich plays, such as the Eagle Ford Shale of South Texas.
In its investor presentation, Chesapeake noted that in recent weeks, "an incredible 1.2 billion shares of stock have been traded, equal to 180% of our outstanding shares."
However, the company said "successful asset sales, ongoing transition to liquids and moving to an asset harvest strategy from an asset capture strategy will carry the day."
The selloff of Chesapeake shares represents "a buying opportunity," Oppenheimer analyst Fadel Gheit said in a note to investors.
"CHK shares have plummeted in recent weeks on relentless attacks by the media, deserved and undeserved, for excessive compensation of its CEO and board, lack of transparency and complex financial structure. Although some changes have been made, more are needed," the analyst said.
"To survive the severe financial impact of low natural gas prices, CHK is accelerating its liquids production growth and asset monetization," Gheit noted.
He added that Chesapeake "is confident in its ability to sell" $9 billion to $11.5 billion of non-core assets this year and another $4.5 billion to $5 billion of assets next year to close its funding gaps in these years and reduce debt.
"Although CHK is fighting an uphill battle, we think its net asset value, after the pending asset sales, is several times its current share price," he said.
A Chesapeake spokesman did not immediately respond to a Platts call and email requesting comment.
