Chesapeake Energy’s leadership is watershed issue

[ NOVEMBER 2, 2009 - OKLAHOMA CITY, OK ] - It is often said that if you can make it in New York, you can make it anywhere. Oklahoma’s own Chesapeake Energy recently proved that they have what it takes to make it in New York, just as they have proven for years elsewhere in America.

Chesapeake has announced its commitment to not drill for natural gas within the upstate New York watershed, an environmentally sensitive region that supplies unfiltered water to almost 10 million people. This region enjoys enormous natural gas reserves, known as the Marcellus Shale, that have been limited in their production ability because of local concerns about effects within the watershed. To Chesapeake’s credit, they have opted to bite the bullet on these thousands of acres of leasehold interests to prove their commitment to safe and transparent production that also achieves environmental high marks. They are leading by example.

Chesapeake Energy Corp. is one of the leading producers of natural gas in the United States. And although it’s headquartered in Oklahoma City, the company’s operations are focused on the development of onshore unconventional and conventional natural gas in several parts of America, including the Barnett Shale, Haynesville Shale, Fayetteville Shale, Marcellus Shale, Anadarko Basin, Arkoma Basin, Appalachian Basin, Permian Basin, Delaware Basin, south Texas, Texas Gulf Coast and east Texas regions of the United States.

Much of America’s enormous opportunity for cleaner energy comes in the form of its abundant natural gas, with estimates that exceed demand for the next 100 plus years. This abundance comes at a time of desperation for our economy to find cleaner forms of energy to rely upon, especially in the power generation sector, which still employs 50 percent of its power from dirty coal and accounts for much of America’s pollution.

However, this cleaner, American, natural gas opportunity remains thousands of feet below ground, unless states allow access for exploration and production, and regulation of technologies for safe recovery.

Experts have known for years that natural gas deposits existed in deep shale formations, but until recently the vast quantities of natural gas in these formations were not thought to be recoverable. Today, through the use of hydraulic fracturing, combined with sophisticated horizontal drilling, extraordinary amounts of deep shale natural gas from across the United States are being safely produced.

Hydraulic fracturing has been used by the oil and gas industry since the 1940s and has become a key element of natural gas development worldwide. In fact, this process is used in nearly all natural gas wells drilled in the U.S. today. Properly conducted modern hydraulic fracturing is a safe, sophisticated, highly engineered and controlled procedure.

But we know that in Oklahoma, and the region around us, where we have seen the safe use of hydraulic fracturing and horizontal drilling for years, to create a real boost to our economy, our air quality and our local public budgets that benefit from the cleanest of fossil fuels.

These techniques are new, however, in the eyes of many in the Big Apple. And instead of fighting for years in the bureaucratic jungle of Albany, N.Y., and New York City, Chesapeake Energy has done what leaders do. They have stepped past their own immediate pecuniary gain and opted instead for the road less traveled … a road that allows the larger development of the Marcellus Shale to be safely developed in New York.

America is better off with the greater development of these unconventional shale reserves and New York is better off because Chesapeake Energy is a leader, willing to invest and do what’s right to help the region.

Now, “It’s up to you New York, New York ....”

Jim Roth, a former Oklahoma corporation commissioner, is an attorney with Phillips Murrah P.C. in Oklahoma City, where his practice focuses on clean, green energy for Oklahoma.