Another Chesapeake Asset Sale Jolts Shale Stocks (CHK, BHP, CEO, TOT, ERF, CNX, DVN)

Tickerspy’s Shale Gas Index

SHALE GAS INVESTING IDEAS

• Popular long ideas: CHK, KMP, ERF
• Popular short ideas: CHK, CNX, SWN
• Top dividend plays: BBEP, ERF, KMP
• Pro favorites: DVN, KMP, PXD

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SHALE GAS COVERAGE

Companies focused on the extraction of oil and gas from shale formations

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SHALE GAS CHART

SHALE GAS METRICS

Avg. Market Cap:	$6.0B
Avg. P/E Ratio:	38.8
Avg. Div Yield:	1.4%

Natural gas futures have endured a multi-year slide, but the picture is far rosier for shares of shale gas stocks, which are bouncing today thanks in part to some more asset sales in the sector. The Shale Gas Stocks Index is higher by 0.3% and has jumped 15% in the past three months.

Chesapeake Energy (CHK), the second-largest U.S. natural gas producer, is surging 8% after announcing the sale of Fayetteville Shale assets to BHP Billiton (BHP), the world’s largest mining company, for $4.75 billion. The assets include 487,000 acres which produce 400 million cubic feet of natural gas per day. BHP, the Anglo-Australian mining giant, has previously said it is targeting acquisitions in the oil and gas market.

Oklahoma-based Chesapeake has been shedding gas assets to raise cash to reduce its debt load and to increase its exposure to oil. In January, the company sold shale assets in Colorado and Wyoming to CNOOC (CEO), China’s third-largest oil producer, for over $500 million. That deal followed a shale deal in Texas in October between the two companies worth over $1 billion. Chesapeake also sold over $2 billion in shale assets to Total SA (TOT), Europe’s third-largest oil company, in early 2010.

Enerplus Resources Fund (ERF) is also participating to the upside with a 3% gain. Consol Energy (CNX) and Devon Energy (DVN) are both up 1% on the day.

Investors can track the Shale Gas Stocks Index for performance trends and a suite of other metrics at tickerspy.com.

Tags: BHP, CEO, CHK, CNX, DVN, ERF, TOT