CHK Expects to See Significant Oil Growth in the Powder River Basin
Powder River Basin
Chesapeake Energy (CHK) owns 307,000 acres in the PRB (Powder River Basin) and has 2.7 billion barrels of oil equivalent gross recoverable resource potential. The company considers the PRB to be its next “oil-growth asset.”
Meanwhile, negotiated midstream contracts negotiations have helped reduce its gathering and processing costs (We’ll discuss this further in the next part of the series).
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In October 2016, Williams Partners (WPZ) and Crestwood Equity Partners (CEQP), 50-50 joint venture partners in the Bucking Horse natural gas processing plant and Jackalope Gas Gathering System, announced that they had signed an agreement with Chesapeake Energy for gas gathering and processing services in the PRB.
Doug Lawler, Chesapeake’s Chief Executive Officer, stated the following in a recent press release: “The new attractive fixed-fee structure will allow Chesapeake to accelerate our development plans, improve margins, and achieve the full potential of our Powder River acreage.”
Now let’s take a look at CHK’s focus in the Eagle Ford.