?When energy investor and Tulsa, Okla., billionaire George Kaiser stepped up to the plate and slammed nearly $500 million into cash-strapped, Oklahoma City-based producers Chesapeake Energy Corp. (NYSE: CHK) and SandRidge Energy Inc. (NYSE: SD) in January in two transactions, his home-run confidence may have defined the turning point for the energy industry in the ongoing financial maelstrom.


Kaiser’s fund Argonaut Private Equity, with more than $3.5 billion under management, first bought South Texas production from Chesapeake in a volumetric production payment for $412 million. It followed with a $50-million private transaction with SandRidge chief executive Tom Ward for some of his personal stock in SandRidge.


Kaiser has acquired approximately 8.9 million shares of SandRidge from Ward in a deal valued at $50 million. Kaiser acquired the shares at $5.62 each and can sell the shares back to Ward at that price on Feb. 16. Ward now beneficially owns 29.05 million SD common shares, or 17.5%.


SandRidge has E&P assets in West Texas, the Cotton Valley Trend in East Texas, the Gulf Coast, the Midcontinent and the Gulf of Mexico. Net proved reserves at year-end 2007 were 1.5 trillion cu. ft. of gas equivalent (86% gas).


Ward says, “This was necessary for debt-service and tax-planning needs. Although I am disappointed to sell shares at this price, I am pleased to have completed a negotiated, private transaction with such a highly regarded investor rather than an open-market sale.


“I continue to have the highest regard for our company and the assets we hold.”


The Chesapeake deal, having a Dec. 31 closing date, helped CEO Aubrey McClendon live up to his promise to investors to get the deal done by year-end, although a few million dollars short of his targeted $450 million.


During the heady days of the commodity-price run-up, Chesapeake spent money readily, according to JPMorgan analyst Joe Allman, but was able to raise some $12 billion in asset sales and credit lines during 2008 to pull out of a nosedive and avert catastrophe.


A few days following, Kaiser, also chairman of private Kaiser-Francis Oil, bought the 5% stake in SandRidge, representing a 23% chunk from Ward’s personal holding. Ward was a co-founder of Chesapeake and the chief operating officer until splitting to form SandRidge in 2007.


Of note, Ward sold his personal working interests in SandRidge-operated wells back to SandRidge for $60 million in October.


Tudor, Pickering, Holt & Co. Securities Inc. analysts like the combo, calling it a “vote of confidence” that Chesapeake and SandRidge assets are “pretty solid.” Kaiser is “a well-regarded energy money-maker” and historically has “knocked the ball out of the park in both commodities and the E&P business.


“We’ve got a savvy local buyer stepping up.”

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