Research Update: Chesapeake Energy Corp. And Affiliates Rating Outlook Revised To Negative; 'BB+' Credit Rating Affirmed Feb 12

Standard & Poors, February 2012

Abstract
Depressed natural gas prices are having a negative impact on U.S.-based Chesapeake Energy Corp.'s (Chesapeake) operating cash flow. We believe this will increase the company's near-term free cash flow deficit, notwithstanding some planned reduction in capital investment. We are affirming our ratings on Chesapeake ('BB+' corporate credit rating and senior unsecured debt issue rating) and on two affiliates--Chesapeake Oilfield Operating LLC and Chesapeake Midstream Partners L.P. We also revised our rating outlooks to negative from stable. Unless Chesapeake can fund its cash requirements through means that do not entail an increase in financial leverage on an adjusted basis, we could lower the ratings. (Watch the related CreditMatters TV segment titled, "Chesapeake Energy: Weak Natural Gas Prices Fuel Standard & Poor's...

Companies mentioned in this report are: Chesapeake Energy Corp.,Chesapeake Midstream Partners L.P.,Chesapeake Oilfield Operating LLC
Action: Affirmed
Action: Outlook: Negative

Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.

Product Type: Research Update
Research updates complement media releases. They offer more depth and detail than summary analyses by incorporating all information published in the media release. They are more up to date than summaries in that they are published simultaneously with media releases.

Chesapeake Energy Corp.,Chesapeake Midstream Partners L.P.,Chesapeake Oilfield Operating LLC

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