Chesapeake Energy Paying $2,500 per Acre to Lease Utica Shale
An article on the Forbes website covers a recent energy conference held by Yale alumni. The focus of the article is on how America’s shale gas has turned around chemical companies. But MDN found this interesting paragraph talking about the Utica Shale:
Shale gas is expected to supply 45% of the U.S. market by 2025. That’s bad news for producers with expensive reserves, and even low-cost producers were fretting at the conference about a growing bubble as drillers punch holes in the ground simply to avoid losing control of leases that require drilling or they expire. This use-it-or-lose-it behavior has trapped drillers in previous gas booms and once again, Chesapeake Energy seems to be leading the charge, paying $2,500 an acre for dirt in the Utica Shale that others acquired for as little as $150.*
In many places where there is Marcellus Shale, if you go another mile or so beneath it, you will find the Utica Shale layer. This is a news site about drilling in the Marcellus because that’s where the action is right now. But increasingly MDN hears about the Utica Shale. So from time to time when those stories come along we may share a few of them as it may impact landowners who also have Marcellus Shale.
*Forbes (Apr 9, 2011) – Shale Gas Sparks A U.S. Chemicals Renaissance