Ohio’s Utica shale may not produce as much oil as drillers had once envisioned, although energy companies remain satisfied with the other products they’re finding, Chesapeake Energy Corp. CEO Aubrey McClendon says.
The Wall Street Journal reported Wednesday that McClendon said the Utica shale under eastern Ohio is unlikely to generate a major increase in Chesapeake’s oil production.
McClendon said Chesapeake is pleased with its natural gas and natural gas liquids from the Utica shale. It will, he said, be “one of our foundational plays for decades to come.”
Chesapeake , the No. 1 player in Utica shale, has been going after lucrative natural gas liquids: ethane, butane and propane, in addition to natural gas and oil. It has leased more than 1.2 million acres in Ohio.
The Utica shale is not a place “where we are going to probably see a huge amount of oil production growth,” McClendon said Tuesday at an investor conference. “And to the extent the oil works, it will be with some other companies.”
A Chesapeake spokesman told the Wall Street Journal: “For the time being, we are pleased to let other companies commit their capital to the oil window” of the Utica shale.
Last May, McClendon said Chesapeake was confident that the company would report success in oil drilling in the Utica.
The Utica shale appears to have natural gas to the east with a wet gas deposit or window to the west. That deposit is about 35 miles wide and runs through Carroll, Harrison, Belmont, Columbiana, Guernsey and parts of surrounding counties.
It appeared likely that oil would be found west of that deposit, drillers had said.
Oklahoma-based Devon Energy Corp. had gone after the oil with wells in Medina and Ashland counties.
The company reported in August that the results from those wells were disappointing. It said it intended to move its drilling to the east to tap into the wet-gas window.
Other drillers have reported success with oil wells in parts of the Utica shale area.
Chesapeake is the No. 2 natural gas producer behind Exxon Mobil Corp., but it has shifted to production of liquids, which are more lucrative than natural gas.
That shift was triggered by low gas prices stemming from the natural gas glut.
Bob Downing can be reached at 330-996-3745 or firstname.lastname@example.org.