Chesapeake officials say gas assets will pay off

BY JAY F. MARKS Modified: October 15, 2009 at 4:50 am •  Published: October 15, 2009
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Chesapeake Energy Corp. officials are optimistic about the future, with a stable of "legacy assets” they expect will provide revenue for years to come.

Officials touted Chesapeake’s strengths Wednesday in New York at a conference for investors and analysts that was broadcast live via the company’s Web site.

They pointed out Chesapeake is the most active driller in the United States, with substantial lease holdings in the most lucrative shale gas plays.

"We do feel like we have the No. 1 resource base in the nation,” said Steve Dixon, Chesapeake’s chief operating officer.

Dixon said Chesapeake’s shale holdings will continue producing for years to come, despite "misguided” predictions from an analyst at an industry conference in Denver earlier this week.

"We’re very confident that these types of rocks will continue to bleed gas for decades and decades,” he said.

Jeff Fisher, the company’s senior vice president of production, said the unique size of Chesapeake’s assets will allow the company to develop new technology to maximize production.

"We’ve achieved great results to date, and we’re just getting started,” Fisher said.

Chesapeake detailed its holdings in the nation’s two largest shale plays: more than 500,000 acres in the Haynesville shale in Louisiana and Texas and 1.45 million acres in the Marcellus shale in West Virginia, Pennsylvania and New York.

The company produces an average of 210 million cubic feet equivalent per day of natural gas in the Haynesville shale, a "world class” asset Chesapeake discovered in 2007.

"We’re just scratching the surface on the production side,” geoscience manager John Sharp said of the Haynesville operation, which is being supplemented by additional plays in Louisiana.

Chesapeake is the most active driller in the Marcellus shale, a massive play close to the best gas markets in the northeast.