Chesapeake Energy 1996 Annual Report Download - page 21

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with up to 500 undrilled locations in
what has quickly become one of the
most active onshore exploration plays
iii the U.S. in several decades.
Chesapeake's drilling results from
its initial round of wells in the Mas-
ters Creek portion of the Louisiana
Trend have been encouraging. As a
result, the company is increasing its
CHESAPEAKE ENERGY CORPORATION
drilling activity in this area from five
wells started in fiscal 1996 to 25-35
wells planned for fiscal 1997. Increas-
ing production from this area should
be the driver that provides the oppor-
tunity for the company to double its
production during the next two years.
During fiscal 1997, Chesapeake
plans to test and begin developing
AREAS OF OPERATION
Louisiana Austin Chalk Trend
Drilled Wells 15
Undrilled Locations up to 500
each of its six prospect areas in the
Louisiana Trend: South Brookeland,
Leesville, Masters Creek, St. Landry,
Baton Rouge and Livingston. In con-
junction with its Austin Chalk drill-
ing, Chesapeake will also begin test-
ing its geological theory that the
deeper and more prolific Tuscaloosa
formation underlying the Baton
Rouge portion of our Louisiana
Trend acreage may be productive.
In addition, Chesapeake is partici-
pating in several gas infrastructure
expansion projects that should result
in higher wellhead pricing for the
company's production in the Louisi-
ana Trend. These projects include a
15% ownership in a gas processing
plant and a 50% ownership in the
Louisiana Chalk Gathering System,
a 350 million cubic feet of gas per
day system designed for the Masters
Creek and St. Landry areas.