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Permalink Reply by SBossierGuy on August 26, 2008 at 5:11

Some other highlights:

After just 11 wells Chesapeake is able to bring in wells making 14 million cubic feet of gas per day.

From here on all of wells will be long laterals with at least eight completion stages and Chesapeake will likely produce them on 24/64 chokes rather than the smaller chokes the company completed its first wells on. This will greatly increase the likelihood of completing wells that will begin producing at 10 million cubic feet of gas per day or even better.

Another very positive attribute of the Haynesville will be its superior gas price compared to the Barnett, Woodford, and Fayetteville. In July the Haynesville well head gas price exceeded Barnett well head gas price by about $1.50 per MCFE

With about 3 million acres in the Blob, there’s roughly 4,700 square miles in the Haynesville. At 52 BCF of recoverable gas per square mile, that equals about 2.45 BCF (shouldn't this be 245 TCF?) of recoverable gas in the Haynesville, exactly consistent with what Chesapeake had predicted from the beginning.

In time this [Haynesville] acreage will be worth at least $50,000 per net acre to Chesapeake or $37.00 per share.

Jeff Robertson (Lehman Brothers): So, the [Haynesville] gas doesn’t need to be processed either, does it?
Steven C. Dixon (Chesapeake): "No, it does not. It’s right on the edge, there is some CO2 but we’re able to sell that. We’ll just keep an eye on that."

Cost of well: "We’re on $6.5 to $7 million range on these wells and we feel very confident that we can get that down to $6.5. We’re at 45 to 50 days drilling the wells and that should go down also with experience and time."

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Permalink Reply by ETOilman on August 26, 2008 at 10:53

I read that the other day. I doubt very seriously it will ever get to $50,000 per acre. IMHO.

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Permalink Reply by wpt9452 on August 26, 2008 at 11:36

Now we are beginning to sound like professional football players. We want more and more until it gets unreasonable. Why not 1 million per acre? Maybe there will be another shale in another part of the country that is bigger than the Haynesville and then what? They will pack their bags and go somewhere else. We all have a right to a fair price but let's not price our way out the whole deal.

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Permalink Reply by Snake Stewart on August 26, 2008 at 12:02

And many thousands left available in this current admitted state of play . Not to mention the add ons from when they have to start releasing info from some of these upcoming wells ! Don't think for 1 second that there aren't some people left that are willing to drive the price up. Come catch a ride with us my friend !

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Permalink Reply by Snake Stewart on August 26, 2008 at 12:08

Hey wpt9452 , That sounded almost ridiculous. They haven't picked up and left the Barnet and they are paying huge amounts over there. You need to do a little more homework before you say things like that.When the CEO's of these companies state that $30,000 bonuses are chicken feed , that doesn't leave your comments with much room for credibility.Have you heard of the O&G's signing a lease that paid more then the property was worth on these last 2 shale plays ? Not hardly. They are paying much more money on the Barnett for a whole lot less gas then we have. If you think that these offers today are ridiculous then just wait till the Super Bowl !

If you have already signed , then sit back and enjoy the game! This is still just the pre-season. If not , then see if you can make them pay you too much.

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Permalink Reply by Iris on August 26, 2008 at 11:37

What does IMHO mean?

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Permalink Reply by Snake Stewart on August 26, 2008 at 11:57

In my humble opinion

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Permalink Reply by Snake Stewart on August 26, 2008 at 13:15

That isn't what the question was and I would certainly like for you to stay on point ! chuckle, chuckle .

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Permalink Reply by Iris on September 5, 2008 at 2:46

LOL, anyway thanks snake...

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Permalink Reply by wpt9452 on August 26, 2008 at 12:08

It's true they have leased over 500,000 acres and still want more. My big question is how can they possibly drill enough wells fast enough to hold all these leases. I agree 100 percent that we need alternative and clean fuel to run our nation but that is years away. As much as it would help so many people economically, if we see crude oil drop back to $50 a barrel and gas back to 2 bucks a gallon; all these alternative and clean fuels will go back into the closet and put off until another crisis. I doubt that it will happen though with the political turmoil and big oils money in Washington. In ten years clean water may be more valuable than oil and gas. We must find a balance in all things

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Permalink Reply by Snake Stewart on August 26, 2008 at 13:14

With all due respect , If gas goes back to $2 per gallon I may not need a big bonus.The O&G's WILL leave town before that happens. I agree about the environmental issues that you refer to. Water may be our biggest concern 10 years from now. That has nothing to do with trying to do the very best you can on your lease. Most that are privy about the money are also wanting a safe ,earth friendly lease as well. Most of the folks that I have talked with on this subject live on the land they are leasing and will continue to do so.They certainly put quality of living high up on the shelf , for the most part. People that are strictly money driven always have a price. People that care more about their area and lifestyle don't move as easy.Just my opinion.

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Permalink Reply by Meauxmoney on August 26, 2008 at 13:27

Hey wpt9452

You asked:My big question is how can they possibly drill enough wells fast enough to hold all these leases.

Read Chesapeake's newest release of earnings.....
it says
...in the past, once Chesapeake found gas it only had one way to make money from it and that was to sell the gas over time as the well gradually depleted. Now, however, Chesapeake has developed a way to accelerate that process and that’s by selling off a portion of the company’s new plays to partners at very attractive prices.
My guess is there will be companies from all over the world trying to get in, and CHK will be the seller...

taken from CHK Earnings Call

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