Chesapeake plans to sell some $11.5 billion in assets by the end of the year as it tries to shore up its finances. The company has also said it would sell oil-rich assets in the Permian Basin of Texas and spin-off a royalty trust to develop its Mississippian Limestone deposits.

Shares of Chesapeake are up about 1% at $15.25 in a 52-week range of $13.32-$35.75.

Chesapeake sold a one-third interest in its Niobrara leaseholds to Cnooc Ltd. (NYSE: CEO), the US arm of China Offshore Oil Co., for about $1.3 billion in January 2011.

According to the Budget, Chesapeake has sought assistance from the Boots & Coots division of Halliburton Co. (NYSE: HAL) in controlling the well.

The horizontal portion of the well had been drilled and the company was installing the well’s casing before the hydraulic fracturing process could begin. Last year Chesapeake had a blowout on a well in the Marcellus shale play in Pennsylvania that resulted in drilling and fracking fluids being spilled.

There is no estimate of the amount of gas leaking into the atmosphere, but there appears to be rather limited danger of explosion.

Paul Ausick

American International Group Inc. (NYSE: AIG) Raised to Outperform at William Blair.

Bankrate, Inc. (NYSE: RATE) Started as Buy at SunTrust Robinson Humphrey.

Comerica Inc. (NYSE: CMA) Cut to Market Perform at BMO.

CNOOC Ltd. (NYSE: CEO) Raised to Hold at Jefferies.

Cree Inc. (NASDAQ: CREE) Cut to Hold at ThinkEquity.

Deckers Outdoor Corporation (NASDAQ: DECK) Raised to Neutral at Stern Agee.

First Solar, Inc. (NASDAQ: FSLR) Raised to Hold at Cantor Fitzgerald; Cut to Sell at Wunderlich; Maintained as Buy but cut target $40 from $50 at Argus.

Intel Corporation (NASDAQ: INTC) Maintained Outperform with $35 target and raised 2013 estimates at Credit Suisse.

International Business Machines Corporation (NYSE: IBM) Cut to Neutral at Macquarie; Raised estimates but maintained as Neutral at Credit Suisse.

SAP AG (NYSE: SAP) Reiterated Buy with $84 target at Argus.

T. Rowe Price Group (NASDAQ: TROW) named as Bull of the Day at Zacks.

Tata Motors Ltd. (NYSE: TTM) maintained as the most undervalued stock on the price-to-book versus return on equity valuation model at Credit Suisse.

United Continental Holdings, Inc. (NYSE: UAL) named as Bear of the Day at Zacks.

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JON C. OGG

The company’s CEO, formerly the head of Cnooc Ltd. (NYSE: CEO), said that Sinopec would try to balance its dominant position as a refiner — it’s China’s largest refiner — by adding more upstream assets in foreign countries. Sinopec also wants to explore for more hydrocarbons in western China and to speed up development of domestic shale gas fields. The catch is that the country produces no shale gas at the moment.

Sinopec Group, parent of Sinopec, has purchased some $48.1 billion worth of foreign assets since 2008 according to Reuters. The parent is expected to contribute some foreign assets to Sinopec Corp. over the next few years, assets that are expected to improve the company’s profitability.

We are presently owned by a group of investors who don’t think gas prices will ever go above $4. I want to be owned by investors who live in a part of the world that believes gas prices will never go below $10.

That part of the world is Asia, where Chesapeake has already sold stakes in some of the company’s Eagle Ford play to Cnooc Ltd. (NYSE: CEO) for more than $2 billion. The company also sold a stake in the Utica shale to France’s Total SA (NYSE: TOT) for $2.3 billion earlier this year.

Chesapeake’s theory is that natural gas prices demand for natural gas from Japan, South Korea, China, and other Asian buyers will keep the price for liquefied natural gas (LNG) around its current range of $16/thousand cubic feet, nearly 8x US natural gas prices. In order to realize that price, though, Chesapeake needs an export terminal, and the one closest to being started is the Sabine Pass LNG receiving terminal owned by Cheniere Energy Partners LP (AMEX: CQP). First deliveries from that terminal are not due for another five years.

In order to monetize Chesapeake’s assets, McClendon has no choice but to seek partners, and his recent 52-city tour of Asia is a pretty good indicator of where those partners are likely to come from. In Chesapeake’s favor is the long-term view held by potential Chinese investors. In McClendon’s view, Chesapeake is sitting on assets worth about $100 billion and the company’s debt of $10 billion does not raise the doubts among Asian investors that it does among US investors:

They [Asian investors] don’t say, ‘You’ve got $2 billion too much debt.’ They say ‘You’ve got what the world wants, and someday gas prices are going to be unlocked from the jail cell where they are today, and you’re going to be the biggest winner.

Chesapeake’s shares are down about -2% this morning, at $24.08 in a 52-week range of $2041-$35.75.

Brocade Communications Systems Inc. (NASDAQ: BRCD) Reiterated Hold at Argus.
Cabela’s, Inc. (NYSE: CAB) named as value stock of the day at Zacks.
Chesapeake Energy Corporation (NYSE: CHK) Reiterated Neutral at Credit Suisse.
CNOOC Ltd (NYSE: CEO) Cut to Neutral at Credit Suisse.
Excel Maritime Carriers (NYSE: EXM) Cut to Underperform as Bear of the Day at Zacks.
Hewlett-Packard Co. (NYSE: HPQ) Reiterated Neutral at Credit Suisse.
Juniper Networks Inc. (NYSE: JNPR) Cut to Market Perform at FBR.
Level 3 Communications Inc. (NASDAQ: LVLT) Raised to Overweight at Morgan Stanley.
LM Ericsson Telephone Company (NASDAQ: ERIC) Raised to Overweight at JPMorgan.
MercadoLibre (NASDAQ: MELI) Cut to Neutral at JPMorgan.
PetroChina Company Limited (NYSE: PTR) Raised to Outperform at Credit Suisse.
Pool Corporation (NASDAQ: POOL) named Bull of the Day at Zacks.
TJX Companies Inc. (NYSE: TJX) Reiterated Hold at Argus.
VIVUS, Inc. (NASDAQ: VVUS) reiterated Outperform but raised target to $36.00 at Credit Suisse; Raised to Hold at Brean Murray.

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JON C. OGG

A couple of developments could be responsible for the company’s casual attitude to the loss of the Pan American sale. First, its two partners in the Macondo well, Anadarko Petroleum Corp. (NYSE: APC) and Japan’s MOEX, have kicked in $4 billion and $1 billion, respectively, to the reserve fund BP has set up to pay claims resulting for the explosion that killed 11 workers and dumped millions of barrels of oil into the Gulf of Mexico. Anadarko also relinquished its 25% stake in the well.

BP still has claims outstanding against Transocean Ltd. (NYSE: RIG) and Halliburton Co. (NYSE: HAL), demanding a minimum of $40 billion from Transocean and an unspecified amount from Halliburton. BP is also seeking compensation from Cameron International Corp. (NYSE: CAM), makers of the blowout preventer that failed.

A recent federal investigation may have strengthened BP’s position in relation to both these outstanding lawsuits, so much so that Anadarko was willing to pay now in exchange for getting immunity from further payments. BP has got to be counting on at least some payments coming from Transocean and Halliburton to help ease the total $42 billion the company has so far committed to the clean-up and claims funds.

BP has so far gotten off pretty lightly in claims payments, having paid out just over $7 billion of the $20 billion it put into the claims fund back in 2010. That could lead the company to believe that it may get off the hook for as little as half the full amount. Coupled with the encouraging (for BP) report from the latest federal investigation, the $42 billion commitment may cost BP far less.

So why increase asset sales? Here’s what BP said in a statement over the weekend: “BP’s current divestment programme is focused on the sale of non-strategic assets and not driven by a requirement to raise cash. As such, BP does not currently plan to divest additional assets to offset proceeds which would have been received from the [Pan American] transaction.”

The company thinks it sees an upper limit to its liability for the Macondo disaster that is smaller than it originally planned for and believes that now is the time to return to more normal operations. The company has received permission for new drilling in the Gulf and is restarting its other operations there as well. BP also has $18 billion in cash that is not committed to the Gulf clean-up and claims funds.

BP may be right about its chances, but taking its fights with Transocean and Halliburton to court is at least as risky for BP as it is for the others. If BP is found to have been grossly negligent, its fines could jump three-fold. Even if it is ajudged innocent of gross negligence, the company remains on the hook for nearly $16 billion.

BP’s charm offensive dealing with the effects of the spill has had its intended effect on US regulators. The company’s production restart and new drilling permit are the evidence of that. The second part of its charm offensive is now going to be directed at investors through re-instated dividends and asset sales that will boost profits.

The Pan American sale could still happen, but not because BP needs the cash. If the deal happens now, it will accrue to the benefit of shareholders. That’s a pretty slick transition. And it only took BP a year to make it happen. Look for Bob Dudley to get a nice bonus in his next pay review.

Paul Ausick

Agrium, Inc. (NYSE: AGU) named Bull of the Day at Zacks.
Agnico-Eagle Mines Ltd. (NYSE: AEM) Raised to Outperform at Credit Suisse.
American Express Company (NYSE: AXP) Cut to Hold at Jefferies.
AMR Corporation (NYSE: AMR) Raised to Outperform at Rodman & Renshaw.
BHP Billiton (NYSE: BHP) Raised to Outperform at Credit Suisse.
Capital One Financial Corp. (NYSE: COF) Cut to Hold at Jefferies.
Chipotle Mexican Grill Inc. (NYSE: CMG) Started as Outperform with $370 target at Credit Suisse.
China Petroleum & Chemical Corp. (NYSE: SNP) Started as Neutral at Credit Suisse.
CNOOC Ltd. (NYSE: CEO) Started as Outperform at Credit Suisse.
The Jones Group Inc. (NYSE: JNY) Value stock of the day at Zacks.
LM Ericsson Telephone Co. (NASDAQ: ERIC) Raised to Buy at Citigroup.
PetroChina Co. Ltd. (NYSE: PTR) Started as Neutral at Credit Suisse.
Riverbed Technology, Inc. (NASDAQ: RVBD) Cut to Equal-Weight at Barclays.
SodaStream International Ltd. (NASDAQ: SODA) Raised to Buy at Deutsche Bank.
Sonoco Products Co. (NYSE: SON) Cut to Hold at Argus.
Stillwater Mining Company (NYSE: SWC) Removed from Focus List ar Credit Suisse.
W.R. Berkley Corp. (NYSE: WRB) named Bear of the Day at Zacks.

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 JON C. OGG

China, in particular, stirs a lot of interest because its technically recoverable shale gas deposits are estimated to be about 1,275 trillion cubic feet (Tcf). That’s about 50% more than the estimated 862 Tcf of technically recoverable shale gas in the US. And US companies like Baker Hughes Inc. (NYSE: BHI), Halliburton Co. (NYSE: HAL), Schlumberger Ltd. (NYSE: SLB), and National Oilwell Varco, Inc. (NYSE: NOV) with both deep pockets and experience in shale gas exploration and production could get a crack at developing China’s vast shale gas deposits. US producers like Chesapeake Energy Corp. (NYSE: CHK) and Devon Energy Corp. (NYSE: DVN) are less likely partners, but such a deal is not impossible.

To date, no development of China’s shale gas resources has begun. The government is mulling plans both to offer subsidies to domestic E&P companies and to permit foreign company participation in extracting the gas. China’s approach to allowing its domestic companies to develop shale gas is something of a balance between granting licenses only to big players like Sinopec, formally China Petroleum & Chemical Corp. (NYSE: SNP), Cnooc Ltd. (NYSE: CEO), and China National Petroleum Co.’s Petrochina Ltd. (NYSE: PTR) and permitting smaller players to get into the hunt.

The government wants to avoid the development of hundreds of independent companies, as happened with the coal mining industry. The unlicensed coal mines were extraordinarily lethal to miners and riddled with corruption. The central government has fought hard to bring the miners under control in the last two years or so.

The Chinese have no experience or technology to develop their shale gas resources. Royal Dutch Shell plc (NYSE: RDS-A) has already been signed on by one of the two small Chinese companies to win a lease and the company has also formed a partnership with Petrochina.  Chevron Corp. (NYSE: CVX) and BP plc (NYSE: BP) are in discussions with Sinopec to form a partnership as well. Cnooc paid Chesapeake more than $2 billion for rights to participate in developing some Eagle Ford shale leases.

As China’s government continues to explore its options regarding shale gas development, one thing does seem clear. The government is leaning towards a less restrictive approach than it has taken with other hydrocarbon development. The country is also likely to adopt some sort of subsidy policy that would encourage shale gas development. That would be enough to really get foreign companies lined up to go to work.

Paul Ausick

With American companies moving operations to China and international companies preferring the cheaper Chinese-made goods, the Economic Policy Institute found the U.S. lost 2.8 million jobs in the past decade. While all states have been affected, 24/7 Wall St. looked at the ten states that lost the most jobs to China.

Over the past decade, American imports from China have grown much more than what the country has been able to export into it, causing a massive loss of jobs. “Between 2001 and 2010, the trade deficit with China eliminated or displaced 2.8 million jobs,” the EPI noted in a paper released this month. As would be expected, 1.9 million of those jobs, or nearly 70%, were in manufacturing, the EPI found. The greatest damage occurred in the computer and electronic parts industry, as well as several finished manufactured goods sectors such as apparel and motor vehicles and parts.

China was able to achieve manufacturing cost advantage by moving millions of laborers from rural areas to cities with newly built facilities. Even American companies such as Walmart (NYSE: WMT) cannot afford to buy goods made in the U.S. when they are made so much more efficiently — and of course, so much cheaper — abroad.

Cheap labor may well be the main reason for China’s manufacturing advantage, but currency manipulation could be another, the EPI states. While the cost of labor affected China’s exports, the currency manipulation, which happened despite China joining the World Trade Organization in 2001, distorted its imports. American policymakers have long assumed that as China’s huge middle class grew, U.S. companies’ sales to these new consumers would also grow. But it did not work out that way, the EPI reports: “as a result of China’s currency manipulation and other trade distorting practices, including extensive subsidies, legal and illegal barriers to imports, dumping and suppression of wages and labor rights, the envisioned flow of U.S. exports to China did not occur.” Added to its labor cost advantage, this currency manipulation has been devastating to many U.S. companies.

24/7 Wall St. has looked at the ten states that have had the greatest number of jobs displaced or lost to China in the past decade based on the EPI report: Growing U.S. Trade Deficit with China Cost 2.8 Million Jobs Between 2001 and 2010. We also included the number of jobs lost through imports and gained through exports due to trade with China.

The EPI research does not make an exact forecast of how many more American jobs may be lost due to China’s manufacturing cost advantages and questionable trade policies. And the damage, of course, did not suddenly end in 2010, and is almost certainly ongoing. In fact, nearly half a million jobs were lost or displaced from 2008 to 2010 alone. The joblessness problem in the U.S. is so severe that any added erosion of employment opportunities from forces outside the country will make a recovery of the American economy all the more difficult.

These are the ten states losing the most jobs to China.