The Rising Influence of Rising Affluence

[OakesCS]

North,
i know next to nothing about the Utica shale other than it's under the Marcellus. Following from the CHK website:
http://www.chk.com/News/Articles/Pages/1590490.aspx

Chesapeake Announces a Major New Liquids-Rich Discovery
in the Utica Shale in Eastern Ohio

Having achieved successful results from recent drilling activities in eastern Ohio, Chesapeake is announcing the discovery of a major new liquids-rich play in the Utica Shale. Based on its proprietary geoscientific, petrophysical and engineering research during the past two years and the results of six horizontal and nine vertical wells it has drilled, Chesapeake believes that its industry-leading 1.25 million net leasehold acres in the Utica Shale play could be worth $15 - $20 billion in increased value to the company. Chesapeake’s dataset on the Utica Shale includes approximately 2,000 well logs, full-suite petrophysical data on approximately 200 wells, 3,200 feet of proprietary core samples from nine wells and production results from three wells. As a result of its analysis, the company believes the Utica Shale will be characterized by a western oil phase, a central wet gas phase and an eastern dry gas phase and is likely most analogous, but economically superior to, the Eagle Ford Shale in South Texas.

Chesapeake is currently drilling in the Utica Shale with five operated rigs to further evaluate and develop its leasehold and anticipates increasing its rig count to eight by the end of 2011 and reaching at least a range of 16-20 rigs by year-end 2012. Also, the company believes that its leasehold position in the Utica Shale will support a drilling effort of at least 40 rigs by year-end 2014. Chesapeake is currently conducting a competitive process to monetize a portion of its Utica Shale leasehold position, which will be through an industry joint venture process or through a number of other monetization alternatives. The company anticipates completing a Utica Shale transaction in the 2011 fourth quarter.

I don't think luck had anything to do with it. I'm hoping that my colleagues contributed. In anycase, the CHK statement that makes me all warm and fuzzy is:

Because of persistent and significant oilfield service inflation and a more accelerated drilling program in the Utica Shale play, Chesapeake has increased its planned drilling and completion capital expenditure budget for each of full-year 2011 and 2012 by $500 million to a range of $6.0-$6.5 billion in each year.

cheers,
Charlie