Chesapeake Energy Says Deal for Southwestern Energy to Close Early in 4Q

Chesapeake Energy’s $7 billion acquisition of rival natural gas producer Southwestern Energy is expected to close early in the fourth quarter, CEO Nick Dell’Osso said on Wednesday.

The deal was delayed earlier this year after the U.S. Federal Trade Commission requested additional information from the two. Chesapeake announced the all-stock purchase in January and originally had expected the acquisition to close by June 30.

Dell’Osso said on the sidelines of the Gastech energy conference that the U.S. natural gas market remains oversupplied.

“We are going to be pretty cautious with how we think about changing our supply picture until we see that (oversupply) is no longer the case,” he said.

Chesapeake is producing about 3 billion cubic feet per day of gas and when the Southwestern deal closes its output will rise to about 7 bcfd, he said.

(Reporting by Georgina McCartney)