In my completely uninformed opinion ..... CHK would want to sell for a good price and for this they would need to make the play look attractive.
I recall SSN collaborating on 3d at some point and would presume (ie. wildly guess) that CHK would also have been shooting 3d to allow this to happen. Performance by SSN's well's will add to the prospective value of what CHK has.
You say "SSN can survive on lower producing and shorter production wells". I can't understand why as CHK has the economies of scale. Notwithstanding some unfortunate strategic decisions (and bad market contitions) CHK are not idiots just as Terry is not some O&G god.
I certainly do hope SSN holds the good stuff but the differentiation could be overstated a tad. What differentiates CHK to SSN is a need for cash and a need to maintain and grow HC liquids production in the near to medium term. Being cash solid with no supply commitments to feed expenses SSN can better align development (of possibly less productive areas) to times of POO market strength if need be.
To an extent we may be seeing a POO supply side issue .... in that if people want oil they will have to pay for it (whether they like the price or not). US prices have to rise pending greater reliance on gas.
Cheers
SSN Price at posting:
12.0¢ Sentiment: None Disclosure: Held
