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New York Stock Exchange halts, restarts trading on Chesapeake shares

Chesapeake Energy's corporate headquarters. [THE OKLAHOMAN ARCHIVES]
Chesapeake Energy's corporate headquarters. [THE OKLAHOMAN ARCHIVES]

The New York Stock Exchange halted trading of Chesapeake Energy Corp. stock on Tuesday morning, before allowing trading on its shares to resume.

Exchange officials took those steps after pre-market trading pushed the value of its stock, traded on the New York Stock Exchange under the ticker CHK, markedly lower.

A share of the stock closed Monday at $69.92. After a Bloomberg report on the company's expected bankruptcy filing, pre-market trading pushed its value down to $40.26 at the start of trading Tuesday.

When the market opened, share officials suspended trading on the issue. Once trading resumed at about 11:45 a.m., Chesapeake shares opened at $19.20. The stock closed at $23.85, down about 66% from Monday's close.

The company announced in May it was considering bankruptcy as an option after posting a net loss of about $8.3 billion — about $853 a share — for the first quarter of 2020.

The company, hammered by low commodity prices caused by a global price war and depressed demand caused by COVID-19, stated in its filing with the U.S. Securities and Exchange Commission it had to take a non-cash impairment charge on its assets of about $8.5 billion during the January through March period.

A few days before that, the Oklahoma City energy company notified regulators and investors its board cut some bonuses for senior executives, while also creating a quarterly bonus incentives program for its approximately 1,900 rank and file employees.

A stock value that continued to trend lower over the previous year also had forced the company in April to ask its shareholders to approve its proposal to execute a 1-for-200 share reverse stock split.

That move boosted the stock’s price by reducing its total number of authorized common shares from 3 billion to 22.5 million.

Chesapeake was among many oil and natural gas exploration and production companies that have seen values of their shares plummet since mid-2019.

While its stock value bottomed out before the coronavirus pandemic went global, the resulting cut in global demand for crude oil certainly hasn’t helped.

Chesapeake officials declined to comment. A spokesman for the exchange couldn't be reached Tuesday afternoon.

Jack Money

Jack Money has worked for The Oklahoman for more than 20 years. During that time, he has worked for the paper’s city, state, metro and business news desks, including serving for a while as an assistant city editor. Money has won state and regional... Read more ›