Chesapeake Energy Corp. negotiated a reprieve from its banks that comes at the expense of its bondholders. Under a new financing agreement the embattled oil and gas producer’s unsecured $4 billion revolver will be converted into a secured credit line, according to a company statement. Chesapeake also will be able to raise as much as $2 billion in junior-lien debt, pushing its unsecured creditors further down the pecking order in extracting recoveries during a default. The announcement sparked a selloff in the company’s bonds, erasing as much as $285 million in market value. The “junior lien provision provides a liquidity lifeline –- despite further priming for unsecured holders,” Goldman Sachs Group Inc. analyst Jason Gilbert wrote in a report Thursday. The company would still need to “monetize” more than $2 billion of assets to “address upcoming maturities and (maintain) an adequate liquidity cushion,” he said. Prior to the move, […]