Oklahoma City – Chesapeake Energy Corp. said Wednesday it has agreed to acquire $300 million of mid-continent gas assets through an acquisition of a wholly- owned subsidiary of Tulsa-based ONEOK, Inc.

Based on its own internal engineers' estimates, Chesapeake said it believes it will acquire approximately 200 billion cubic feet of gas equivalent (bcfe) of proved gas reserves, approximately 60 bcfe of probable and possible gas reserves and current gas production of approximately 47,000 thousand cubic feet of gas equivalent (mcfe) per day.

Aubrey K. McClendon, Chesapeake's CEO, said the proven reserves have a reserves-to-production index of 11.0 years, are 94% natural gas and are 88% proved developed. After allocating $25 million of the purchase price to unevaluated leasehold for probable and possible reserves, Chesapeake's acquisition cost per mcfe of proven reserves will be $1.38. The acquisition is expected to close 31 January 2003 and is subject to customary closing conditions, McClendon said.

"The ONEOK acquisition fits perfectly with our existing mid-continent assets and with Chesapeake's business strategy," the CEO said. "This transaction will increase our company's proved reserves to almost 2.5 tcfe and our current production to over 565,000 mcfe per day. Based on the results achieved from our previous acquisitions in the mid-continent, we expect to substantially increase the value of ONEOK's reserves through additional drilling, lower administrative costs and reduced operating costs."

McClendon said, since January 1998, the company has discovered or acquired over three tcfe of proved natural gas reserves at less than $1.20 per mcfe. As a result, Chesapeake has become the largest producer of natural gas in the mid-continent, one of the 10 largest independent gas producers in the U.S. and one of the most profitable companies in the industry, the CEO said.