Market volatility might result in Chesapeake Energy delay in more new wells

Chesapeake Energy Aims to Take Lead in Responsibly Sourced Gas Movement | Hart Energy


Leadership at Chesapeake Energy hinted strongly this week it might hold off on bringing more wells online if low natural gas prices continue to be a challenge.

Executives informed those on a conference call that they anticipate still more volatility in the natural gas markets.

Chesapeake said it had opted to conduct some maintenance in the Haynesville shale while gas prices were low. It also warned that it was seeing a pullback in third-party well proposals and that it anticipated a slowdown in non-operated activity reported Reuters.

Chesapeake isn’t alone in considering steps because of the low prices.

S&P Global reported Tellurian will halt its natural gas drilling operations in the Haynesville region until persistently low prices recover, the Texas-based company said May 3, in a move that comes amid a broader slowdown in gas-directed drilling activity in the US.

“Given that prices have come down very dramatically, we have decided to discontinue the drilling for the time being,” Tellurian Executive Chairman Charif Souki said in a company video address May 3 accompanying Tellurian’s earnings report for the first quarter. “We are not going to drill for now going forward until prices recover.”

Click here for Reuters