Chesapeake and Statoil to Drill 17K Horizontal Marcellus Gas Wells, Statoil Does Deal with MarkWest for Gas Processing

Chesapeake Energy and Statoil ASA are making a major commitment to drilling in the Marcellus Shale over the next two decades:

Statoil holds a 32.5 percent interest in all of Chesapeake’s…acreage. The agreement between the companies covers 1.8 million acres in Appalachia, with more than 32,000 leases in West Virginia, Pennsylvania, New York and Ohio. Statoil established the 17,000-well prediction on the company’s website. [Chesapeake pegged the number closer to 20,000 wells on its website in 2009.]

Now, Statoil – a firm established in 1972 in Oslo, Norway – has inked a deal with MarkWest Liberty for the processing of natural gas liquids at MarkWest’s Majorsville complex in eastern Marshall County [West Virginia]. This facility – which is already operating near capacity – transports the valuable ethane, propane, butane and pentanes by pipeline to the MarkWest storage and marketing complex in Houston, Pa.

“We are excited to expand our existing relationship with Statoil,” said Frank Semple, chairman, president and chief executive officer of MarkWest. “MarkWest Liberty provides integrated NGL transportation, fractionation, storage and marketing services that are critical to optimizing rich-gas development in the northeast United States, and we are pleased to further strengthen our midstream presence in the liquids-rich areas of the Marcellus (Shale).”

MarkWest is close to finishing a second such facility with equal processing power in the Majorsville [West Virginia] area, with the possibility of building a third plant.*

*The Intelligencer / Wheeling News-Register (Mar 10) – Chesapeake Partners With Norwegian Driller Statoil