Chesapeake delays Utica Shale operations report

May 27, 2014

SALEM, Ohio - During Chesapeake Energy's first quarter earnings call, Chris Doyle, senior vice president of operations for the northern division, said the company will provide more detailed information regarding its Utica Shale play operations soon.

Chesapeake is the largest oil and gas leaseholder in Ohio and has many leases in Columbiana County.

There are 102 oil and gas horizontal drilling permits in Columbiana County, and there are 43 drilled wells with 22 of those producing.

The Ohio Department of Natural Resources said that as of May 3 there were 35 drilling rigs in the Utica/Point Pleasant region and 1,248 horizontal permits issued to date.

Statewide, 847 horizontal wells have been drilled and 396 are producing.

Drilling permits have been issued in 24 of Ohio's 88 counties.

Three of the easternmost wells are in Unity Township in Columbiana County, the Fowler well, leased to Chesapeake Exploration (drilled), the Dalton well, leased to SWEPI LP (permitted) and three Firestone Homestead wells (two drilled, one permitted) leased to Atlas Noble LLC.

The northernmost well is in Wayne Township in Ashtabula County and is leased to Beusa Energy LLC, the southernmost well is now being drilled in Center Township in Morgan County by PDC Energy Inc., and westernmost there are two wells in Morgan Township in Knox County, leased to Devon Energy Production Co.

Knox County is northeast of Columbus.

During the first quarter earnings call, regarding the production mix of oil gases versus natural gas liquids that Chesapeake is producing, Doyle said, "I think we'll probably get into that kind of detail next week. What I'll say is that our trajectory has not changed."

The transcribed remarks are on the Seeking Alpha website.

Doyle said, "You look at our total gross process in capacity. We've laid out back in February. We said we're going to ride that capacity all the way up through the end of the year. We are definitely in line to do exactly that.

"I'd say right now, just a rough approximation, the components splits probably 10 percent oil, 30 percent natural gas liquids (NGL) and 60 percent gas plus or minus."

Doyle said they were excited about some of the dry gas tests but noted there's probably two or three generations of completions to go.

"So we are out there, we will be out there testing that dry gas window and excited about hundreds of thousands of acres we've got in it, but then I also say it's not just about dry gas window.

"We are testing every part of that play and just have a tremendous amount of excitement about what we are seeing and we'll share a lot more next week."

"I'll say, what we're forecasting is not requiring any growth out of that asset honestly, what we have is a tremendous position in one of the greatest dry gas basins known and our wells continue to outperform our expectations and industry's expectation and so what we are focused on is capital efficiency and we've got a lot of optionality and we'll share that, with you next week, where we could ramp up and potentially grow the asset, but we are not, we don't need that growth to grow the company and we are in a fantastic position and like the flexibility, when it comes our expectations for Marcellus."



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