fan_from_texas;1064161 wrote:I was reading http://online.wsj.com/article/SB10001424052970203806504577178651732511974.html?mod=WSJ_business_whatsNews
Much of the impact will probably depend on what other players in the market do.
[/URL][URL="http://www.timesreporter.com/topstories/x1251832725/Chesapeake-production-cuts-may-be-good-for-Valley"]Chesapeake Energy’s decision to cut its production of natural gas and shift its resources toward areas rich in oil and natural-gas liquids, such as propane could lead to an expanded investment in Ohio's Utica shale.
Pete Kenworthy, manager of media relations for Chesapeake Energy’s Canton office, said Monday the announcement is consistent with Chesapeake’s plan to increase activity in Ohio in 2012.
“The Utica Shale is part of our national strategy to increase expenditures in liquids-rich plays,” he said. “Our projection of operating 20 rigs in Ohio by year-end 2012 has not changed.”
The U.S. Dept of Energy says the estimated amount of gas in the Marcellus was severely overestimated. Down from 410 trillion cubic feet to 141 trillion cubic feet. At least the news is still good for Ohio's Utica formation. Seems like the energy companies will be concentrating here.QuakerOats;1039638 wrote:The deal is not to "take our natural gas", it is to become a partner in the development of the resource. Chesapeake by itself does not have the ability to completely develop the plays as aggresively as they would like, in fact they are reducing debt levels right now. Bringing in SA allows them to reduce some debt now and at the same time expand on the resource development at a faster pace. SA will get a signficant return on their investment regardless of who the end users of the gas are. There is, at least, over 500 trillion cubic feet of nat gas here --- that is almost an incomprehensible figure. If we play our cards right, this region will benefit in an enormous fashion for decades if not a century or more.
