Chesapeake reports $2.1 billion loss

Chesapeake Energy Corp. reported a $2.1 billion loss for the third quarter of 2012, down from an $879 million gain in the same period a year ago.

The results included a $2 billion estimated write down in value for the company’s natural gas assets.

Excluding those and other write downs, Chesapeake’s adjusted net income was $33 million.

Chesapeake, the nation’s second-largest natural gas producer behind Exxon Mobile Corp., accounted for about a 10 percent loss of value for some of its natural gas assets and included write downs for undeveloped leaseholds in some shale plays.

Although 79 percent of the company’s overall production still comes from natural gas, Chesapeake was able to grow its oil production by 96 percent.

Chesapeake, based in Oklahoma City, now produces 97,785 barrels of oil a day, the company said, accounting for 14 percent of its production.

Its overall production grew 24 percent compared with the third quarter of 2011, to 4.1 billion cubic feet of natural gas equivalent hydrocarbons, with most gains coming from oil and other liquids.

Chesapeake has been embroiled in a struggle to survive since natural gas prices plummeted to decade-low levels early this year, leaving it scrambling to cover its operating expenses with high-interest short-term loans and asset sales.

The company announced early Thursday it had agreed to take out another loan, worth $2 billion, to allow it to pay off other debt and enable it to continue pursuing its strategy of increasing oil production, selling assets and cutting down its long-term debt.

Although Chesapeake CEO Aubrey McClendon reiterated, in a statement, his goal of cutting the company’s long-term debt below $9.5 billion, the figure is currently $15.8 billion, according to Chesapeake’s earnings release.