Chesapekes sets stock sale and shares slip

HOUSTON (Reuters) - Natural gas company Chesapeake Energy Corp (CHK.N: Quote, Profile, Research) said on Tuesday it plans to sell 25 million shares of its common stock in a public offering, with proceeds going to temporarily pay down debt.

Shares of the Oklahoma City company slipped 3.5 percent in after hours trading.

Chesapeake also said it also expects to tap the revolving bank credit facility again to fund its plans to expand drilling and leasehold acquisition in areas including the Haynesville Shale in northern Louisiana.

In March, Chesapeake said Haynesville might hold as much as 20 trillion cubic feet equivalent of potential natural gas reserves.

Last month, the company said it had already locked up the rights to drill on 500,000 acres and said it planned to step up its efforts to acquire acreage there after seeing results from wells drilled in the area.

(Reporting by Anna Driver in Houston, editing by Leslie Gevirtz)