Chesapeake Energy Corp., Oklahoma City, (NYSE: CHK) reports during the third quarter it averaged 108 million cubic feet of gas per day from its Colony Granite Wash in western Oklahoma.
The Colony Granite Wash is in Custer and Washita counties and is a subset of the greater Granite Wash plays of the Anadarko Basin. In the Colony Granite Wash, Chesapeake is the largest leasehold owner with 60,000 net acres and is also the most active driller and largest producer in the play.
To further develop its 60,000 net acres of Colony Granite Wash leasehold, Chesapeake anticipates operating an average of approximately seven rigs in 2010 to drill approximately 40 net wells.
In the Texas Panhandle Granite Wash play in Hemphill, Wheeler and Roberts counties, Texas, third quarter production averaged 79 million cubic equivalent per day.
To further develop its 40,000 net acres of Texas Panhandle Granite Wash leasehold, Chesapeake anticipates operating an average of three rigs in 2010 to drill approximately 20 net wells.
Chesapeake chief executive Aubrey K. McClendon says, “While we expect natural gas prices to move higher in the months ahead, low natural gas prices at the end of the 2009 third quarter led to a 2.2 trillion cubic feet equivalent reduction of our proved reserves. Excluding these price-related revisions, Chesapeake would have reported 14.2 trillion cubic feet equivalent of proved reserves for the quarter—a level above that which we had previously targeted achieving by year-end 2009.”
He adds the company has an attractive finding and net acquisition costs of less than $0.80 per thousand cubic feet equivalent benefitted from strong drilling results, reduced drilling costs and approximately $960 million of drilling carries from its joint venture partners.
Chesapeake has oil and gas properties in Oklahoma, Texas, Alabama, Arkansas, Louisiana, Kansas, Montana, Colorado, North Dakota, Nebraska, New Mexico, West Virginia, Kentucky, Ohio, New York, Maryland, Michigan, Mississippi, Pennsylvania, Tennessee, Utah, Virginia and Wyoming.
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