BP America Inc., Houston, a subsidiary of British major BP Plc, (NYSE: BP) has closed its acquisition of approximately 90,000 net acres of leasehold and producing properties in the Woodford shale play in Oklahoma’s Arkoma Basin from Chesapeake Energy Corp., Oklahoma City, (NYSE: CHK) for $1.7 billion in cash.

Chesapeake is exiting the region with the sale. The assets are in Atoka, Coal, Hughes and Pittsburg counties. Production is approximately 50 million cubic feet of equivalent per day.

Aubrey K. McClendon, Chesapeake chief executive, says, “This transaction completes another aspect of our asset monetization program and enables Chesapeake to redeploy capital to our Haynesville, Barnett and Marcellus shale plays and further improves the company’s capital structure. We now turn our focus to negotiating joint-venture arrangements in the Fayetteville and Marcellus shale plays.”

Referring to the Haynesville joint venture with Plains Exploration & Production Co., Houston, (NYSE: PXP) he says, “We anticipate selling 25% of our interest in those two plays using a “PXP-style” transaction in which we receive partial consideration in cash at closing and then receive a tax-efficient carry of development costs over time as wells are drilled. There is strong industry interest in both plays and also in our preferred deal structure. We hope to announce transaction details by the end of the third quarter.”

Meagher Oil & Gas Properties Inc. was advisor to Chesapeake.