This excerpt taken from the CHK 8-K filed Nov 1, 2005.
Extensive Leasehold Now Exceed 14 Tcfe
Chesapeakes exploratory and development drilling programs and production enhancement operations continue to produce operational results that exceed the companys forecasts and distinguish the company among its peers. During the 2005 third quarter, Chesapeake drilled 241 gross (186 net) operated wells and participated in another 278 gross (32 net) wells operated by other companies. The companys drilling success rate was 97% for both company-operated wells and non-operated wells. During the quarter, Chesapeake invested $390 million in operated wells (using an average of 72 operated rigs), $75 million in non-operated wells (using an average of 65 non-operated rigs) and $91 million in acquiring new 3-D seismic data and new leasehold (excluding leasehold acquired through acquisitions).
During the past seven years, and pro forma for the pending CNR acquisition, Chesapeake has built what it believes to be the largest inventories of onshore leasehold (8.0 million net acres) and 3-D seismic (11.0 million acres) in the U.S. On this leasehold, the company has identified more than a 10-year inventory of approximately 25,000 drillsites on which it believes it can develop approximately 2.6 tcfe of proved undeveloped reserves and approximately 7.0 tcfe of non-proven reserves.
Chesapeake characterizes its drilling activity by one of four play types: conventional gas resource, unconventional gas resource, emerging gas resource and Appalachian Basin gas resource. The companys leasehold and proved undeveloped and non-proven reserve totals are set forth below:
Chesapeake continues to actively acquire more acreage throughout its operating areas with almost 500,000 acres acquired in the 2005 third quarter through an aggressive land acquisition program that is utilizing more than 600 landmen in the field. In addition to the pending CNR transaction through which the company will acquire 3.5 million net acres in the U.S. and 0.6 million net acres in Canada, Chesapeakes most significant land acquisition activities during the quarter took place in the Arkansas Fayetteville Shale play where the company has increased its acreage holdings to 600,000 net acres from the 200,000 net acres of leasehold previously disclosed. Chesapeakes initial six-well drilling program in the Fayetteville Shale is now underway.