Boston, MA 08/01/2014 (wallstreetpr) – Chesapeake Energy Corporation (NYSE:CHK) has won two royalty fights. It finally emerged as a winner in issue of royalty payments related with northern Texas’ Barnett Shale region. The legal case was going in the 5th Circuit Court of Appeals. The court reiterated the decision of the lower court and gave the decision in Chesapeake favour.
The matter
The two royalty owners, Brandy West and Gordon Potts were not happy with the royalty paid. They consider it as underpaid as Chesapeake reduces postproduction costs from the royalty. They have sued the company on the matter. The lower court has said that Chesapeake Energy Corporation (NYSE:CHK) has the right to calculate market value at the point of sale. It can deduct the costs before the royalty payment. The higher court upheld the same decision. The lower court gave the decision two weeks back in North Texas.
The ruling
All the allegations against the Chesapeake were dismissed with prejudice. The royalty owners cannot take the case again in court. They are forbidden to take any legal actions on the same matter. In the first case, Javeed also sued Chesapeake Energy Corporation (NYSE:CHK). His claims dismissal is kept without prejudice.
Adding oil to business
Apart from getting the win in royalty cases, Chesapeake has also got other good news coming from different segments. It said that it would bring more oil to its businesses. It will invest the funds to have more access to oil-soaked shale in Wyoming. Also, it has plans to buyback preferred shares of CKH Utica Unit.
Chesapeake wants to get more access of the regions in the Powder River Basin. It aims to increase the area base, and that will be possible by opting for the land swap through RKI Exploration & Production LLC. The main focus has shifted on oil production rather on the conventional gas drilling activities. All the steps will help Chesapeake to solve the tangled financial agreements existing within Chesapeake Energy Corporation (NYSE:CHK).
