OKLAHOMA CITY, Aug. 4 (UPI) -- Struggling U.S. shale player Chesapeake Energy said it reported a loss for the second quarter, but reduced debt by more than $1 billion.
The company said second quarter revenue declined 54 percent year-on-year and the loss was around $1.8 billion. Chesapeake said the primary driver of the loss was weak energy prices, which for crude oil are down more than 12 percent from last year and more than 50 percent below peak levels in 2014.
Chesapeake, meanwhile, was able to cut its debt load by more than $1 billion as it worked to keep costs under control.
"Financial discipline remains our top priority," CEO Doug Lawler said in a statement.
Chesapeake in early February retained the services of longtime counsel Kirkland & Ellis to help manage debt and strengthen its balance sheet, though it said it had no plans to pursue bankruptcy.
The late Aubrey McClendon helped establish Chesapeake as a shale oil and natural gas pioneer before he was ousted through an investor rebellion in 2013. Under his tenure, the company became one of the largest natural gas producers in the United States.
In the first quarter, the company suspended payment of preferred dividends in order to redirect about $170 million in cash toward its debts.
Chesapeake said it has 10 drilling rigs spread across Texas and other regional shale basins and the Utica shale in and around the Great Lakes states.
Second quarter daily production was around 657,100 barrels of oil equivalent per day and the company raised its full-year expectations for output by 3 percent. Looking forward, however, Chesapeake said next year would be relatively stable.
"As for an initial look into 2017, we believe our oil production will be relatively flat in 2017 as compared to 2016," Lawler said.