Current and former Fayetteville Shale leaders Southwestern Energy and BHP Billiton (Chesapeake Energy) sent signals through the energy industry late this week that both are ready to expand their drilling programs well beyond the Arkansas shale reservoir.
In announcing impressive second quarter results, Chesapeake and Southwestern touted new exploration programs that could boost profits for both U.S.-based drillers for years to come.
Chesapeake highlighted energy stock performance in stock market trading Friday (July 29) after the Oklahoma City based driller announced a new “major discovery” in Ohio. Company officials boasted that the discovery was superior to the Eagle Ford Shale – the huge gas-liquids shale play in South and West Texas with an estimated 4 billion barrels in recoverable reserves.
“Chesapeake believes that its industry-leading 1.25 million net leasehold acres in the Utica Shale play could be worth $15 - $20 billion in increased value to the company,” Chesapeake said in its second-quarter earnings report. “As a result of its analysis, the company believes the Utica Shale will be characterized by a western oil phase, a central wet gas phase and an eastern dry gas phase and is likely most analogous, but economically superior to, the Eagle Ford Shale in South Texas.”
The news of the projected multi-billion oil and natural gas discovery sent the company’s stock up more than 3% in mid-day trading on Friday. The share price eventually settled at $34.35, up 92 cents over Thursday’s close. In April, Chesapeake exited the Fayetteville Shale with the sale of 2.4 trillion cubic feet of proven reserves to Australia-based BHP Billiton Petroleum for $4.75 billion in cash.
Source: The City Wire
For Oil Investments or Energy Stock News
No comments:
Post a Comment