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CHESAPEAKE ENERGY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
17. Condensed Consolidating Financial Information
Chesapeake Energy Corporation is a holding company and owns no operating assets and has no
significant operations independent of its subsidiaries. Our obligations under our outstanding senior notes and
contingent convertible senior notes listed in Note 3 are fully and unconditionally guaranteed, jointly and
severally, by certain of our wholly owned subsidiaries on a senior unsecured basis. Our midstream subsidiary,
CMD, is not a guarantor and is subject to covenants in the midstream revolving bank credit facility referred to in
Note 3 that restricts it from paying dividends or distributions or making loans to Chesapeake.
Set forth below are condensed consolidating financial statements for Chesapeake Energy Corporation
(parent) on a stand-alone, unconsolidated basis, and its combined guarantor and combined non-guarantor
subsidiaries as of December 31, 2010 and 2009 and for the years ended December 31, 2010, 2009 and 2008.
The financial information may not necessarily be indicative of results of operations, cash flows or financial
position had the subsidiaries operated as independent entities.
CONDENSED CONSOLIDATING BALANCE SHEET
AS OF DECEMBER 31, 2010
($ in millions)
Parent
Guarantor
Subsidiaries Non-Guarantor
Subsidiaries Eliminations Consolidated
CURRENT ASSETS:
Cash and cash equivalents ........ $ — $ 2 $ 100 $ — $ 102
Other ......................... 7 3,065 123 (31) 3,164
Total Current Assets ........... 7 3,067 223 (31) 3,266
PROPERTY AND EQUIPMENT:
Natural gas and oil properties, at
cost based on full-cost
accounting ................... — 27,822 4 — 27,826
Other property and equipment,
net.......................... — 3,230 1,322 — 4,552
Total Property and Equipment . . . — 31,052 1,326 — 32,378
Other assets ................... 166 669 700 — 1,535
Investments in subsidiaries and
intercompany advance ......... 1,217 263 — (1,480) —
TOTAL ASSETS ................ $ 1,390 $ 35,051 $ 2,249 $ (1,511) $ 37,179
CURRENT LIABILITIES:
Current liabilities ................ $ 302 $ 4,082 $ 137 $ (31) $ 4,490
Intercompany payable (receivable)
from parent ................... (23,664) 21,939 1,612 113 —
Total Current Liabilities ......... (23,362) 26,021 1,749 82 4,490
LONG-TERM LIABILITIES:
Long-term debt, net .............. 8,934 3,612 94 — 12,640
Deferred income tax liabilities ...... 482 1,879 136 (113) 2,384
Other liabilities .................. 72 2,322 7 — 2,401
Total Long-Term Liabilities ...... 9,488 7,813 237 (113) 17,425
EQUITY:
Chesapeake stockholders’ equity ... 15,264 1,217 263 (1,480) 15,264
Noncontrolling interest ........... — — — — —
Total Equity .................. 15,264 1,217 263 (1,480) 15,264
TOTAL LIABILITIES AND
EQUITY ..................... $ 1,390 $ 35,051 $ 2,249 $ (1,511) $ 37,179
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