That gas boom?
A gas glut, and reduced prices, has prompted Chesapeake Energy to trim its drilling plans, the Wall Street Journal reports. Impact on Arkansas not totally clear.
But Talk Business picks up more detail from the Chesapeake news release, which indicates its planned $3.2 billion Fayetteville shale exploration will be cut by 25 percent, or about $800 million. (UPDATE: It appears, however, that this cut doesn't necessarily mean a reduction in exploration. Rather it's a reduction in Chesapeake expenditures as a result of selling a quarter of the venture to BP.)
BY THE WAY: I'm going to post this item shortly on our new house blog, Shale Watch, devoted to the Fayetteville shale play. Gerard Matthews, who's done some reporting already on shale issues, is going to generally oversee the effort. It will be a work in progress. But we welcome contributions from others about life in the shale -- production, profit, environment, etc. Write him at gerard@arktimes.com
Comments
The Talk Business Article re: capital expenditure cut backs in AR is a bit misleading. Chesapeake's news release says: "Of the $3.2 billion drilling capex reduction, $0.8 billion is attributable to the drilling capex carry associated with the company's recently closed Fayetteville Shale joint venture with BP America (NYSE:BP).." which suggests that this $800 million is being covered by BP, not CHK, resulting in a reduction in expenditures from CHK's funds, but not necessarily an $800 million reduction in capex expenditures in AR.
Posted by: NorthCentral![[TypeKey Profile Page]](http://www.arktimes.com/blogs/arkansasblog/nav-commenters.gif)
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September 23, 2008 09:55 AM
Oh thanks No Central. Now those royal checks can keep flowing. God is on the move again.
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Posted by: eLwood![[TypeKey Profile Page]](http://www.arktimes.com/blogs/arkansasblog/nav-commenters.gif)
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September 23, 2008 10:14 AM