Chesapeake falls following asset sale announcement

Norway-based StatoilHydro will pay about $3.38 billion for a 32.5 percent stake in the company's Marcellus Shale gas assets in the Appalacian region, the company said.

This was one more large sale of the company's assets in a series of stake sales over the last two months. In September British oil company BP PLC announced plans to buy a 25 percent stake in Chesapeake's Fayetteville Shale assets in Arkansas for $1.9 billion, just one month after BP America bought Chesapeake's Arkoma Basin Woodford Shale assets in Oklahoma for $1.7 billion.

In October, Chief Executive Aubrey McClendon was forced to sell almost 95 percent of his holdings--more than 31 million shares valued at about $570 million--which represented more than a 5 percent stake in the company.

Analysts had expected this recent sale and the subsequent boost in liquidity would bolster Chesapeake share prices.

"Given the environment and generally lower high-water markes in the Marcellus, we view the price paid as favorable for Chesapeake," said Stifel, Nicolaus & Co. analyst Michael A. Hall.

Goldman Sachs analyst Brian Singer said in a note on Tuesday that the sale was positive for both Chesapeake and the sector. However, company shares retreated, as did the overall energy market, which has been hit hard by tanking oil prices. Crude sank below $60 a barrel on Tuesday for the first time in 20 months. In two days the International Energy Agency will release a report, which some analysts expect will cut its 2009 oil demand forecast for the third consecutive month.

Shares of Chesapeake lost $1.39, or 5.9 percent, to $22.30 in afternoon trading. The stock is down 68 percent from its 12-month peak of $74 in July.