NEW YORK (Reuters) - Chesapeake Energy (CHK.N) will meet with many of its major lenders in Oklahoma City later this week, as the second-largest U.S. natural gas producer scrambles to raise cash to close a $9 billion to $10 billion funding shortfall, according to sources familiar with the matter.
One of the sources said that it was a regularly scheduled meeting. But the company is expected to talk about its plans and liquidity needs at the meeting, the sources said, at a time when it is under immense pressure due to low natural gas prices and governance problems.
A company spokesman was not immediately available for comment.
Like other natural gas producers, Chesapeake has suffered as prices for the fuel sank to the lowest levels in a decade, shrinking cash flows and raising worries that companies may need to reduce the estimated value of their properties.
The company has also been embroiled in a corporate governance crisis that prompted its move to replace co-founder and Chief Executive Aubrey McClendon as chairman.
Analysts and investors have called for change at the company after Reuters reported that McClendon had taken out more than $1 billion in loans using his interest in thousands of company wells as collateral.
Billionaire investor Carl Icahn, who owns a 7.6 percent stake in the company, has called for the natural gas producer to replace at least four directors, saying the board has failed “in a dramatic fashion” in its oversight of management.
Editing by Phil Berlowitz