Chesapeake Seeing the Reward of Utica Shale Investments
From The Motley Fool:
Former Chesapeake Energy (NYSE: CHK) CEO Aubrey McClendon once called the Utica Shale the "best thing to hit Ohio since the plow." Some laughed at that remark a few years back, especially after early returns didn't show that the play held much producible oil. Bold statements like that, combined with poor returns, forced McClendon into an early retirement from Chesapeake. However, after looking through the oil and gas producer's most recent results, McClendon is probably the one who's laughing.
Last quarter, Chesapeake's production in the Utica shot up by 91% compared to the prior quarter. The company produced 164 million cubic feet of natural gas equivalent per day after it connected 63 wells to pipelines. There's even more growth on the way. After drilling 377 wells in the play, Chesapeake Energy still has 208 wells still in various stages of completion.
New CEO Doug Lawler noted that while Texas' Eagle Ford shale would fuel Chesapeake's oil production growth next year, the Utica and Marcellus shales would do the heavy lifting to fuel production growth for both natural gas and natural gas liquids. The big reason why the Utica is starting to deliver results is because infrastructure is finally starting to come online to unlock the play's potential.