Impact Of Chesapeake Sale To Southwestern Energy
JACKSON TOWNSHIP — One of the big players in the natural gas industry in our area has sold off a big chunk of its leased land in northeastern Pennsylvania.
Chesapeake Energy sold 162,000 acres to Southwestern Energy. Most of that land is in Susquehanna, Wyoming, Sullivan and Lackawanna Counties.
This gives Southwestern an even bigger presence in the Marcellus Shale.
Flames were pouring out of a Southwestern Energy gas well east of New Milford. This burning off process is just part of a lot of Southwestern drilling activity in this part of Susquehanna County.
Now, that company has nearly doubled its presence in this county by buying leased land from Chesapeake Energy.
“They seem anxious to please you,” said Alice Potter.
Potter has a Southwestern lease and benefits from the well just down the road and she also has a Chesapeake lease at her family homestead not far from here.
That lease will now be Southwestern’s.
“We’ve been delighted because Chesapeake went bankrupt, well, they left.”
Chesapeake didn’t go bankrupt, but has financial problems and hasn’t focused on this part of the county like Southwestern has.
Chesapeake leaseholders hope Southwestern brings more activity and royalties to their land.
“It’s my old family home and there are six of us in together and I’m sure the rest of us could use it,” Potter added.
Analysts say Southwestern wants more leased acreage in Susquehanna County, especially because of reports of wells in the area doing so well and being so productive.
“If I had a Chesapeake lease and now it belongs to Southwestern, I’d be much more pleased today than I was yesterday,” said Doug Clark.
Clark is a lawyer in Peckville focusing on the natural gas industry. He said Southwestern often lets leaseholders keep more royalties than Chesapeake. He also showed us a map of Chesapeake and Southwestern properties and said Lackawanna and Wyoming County leaseholders will see little change in activity. The biggest benefit will come to Chesapeake leaseholders in Susquehanna County.
“You’re going to see areas that were mixed Southwestern and Chesapeake and now they’re all coming together. So I think it’s going to be much easier for Southwestern to develop the area. They’ll do it more quickly and hopefully we’ll see more intense development.”
Chesapeake is holding on to highly-productive natural gas lands in Bradford and Lycoming Counties.
The $92 million sale of the other lands to Southwestern Energy is expected to close May 15.