Chesapeake CEO: finding natural gas support not easy, but necessary

Chesapeake Energy Corp. CEO Aubrey K. McClendon acknowledged the dominance of coal and oil in the power-generation and transportation sectors, but reiterated his belief that natural gas is the only viable way to reduce both carbon dioxide emissions and foreign oil imports.

The Oklahoma native touched on a range of topics during a Nov. 13 speech in Downtown, and used the opportunity to again drum up support for initiatives that would favor increased natural gas demand, much like businessman T. Boone Pickens has done since July 2008 with his Pickens Plan.

“There is only one scalable, affordable, clean way to reduce foreign oil and that is to begin to move our transportation system away from oil to natural gas,” said McClendon, speaking to an audience at the Petroleum Club of Fort Worth. He asked, “Would you be willing to use a fuel that’s made in America, creates American jobs, puts off 50 percent less CO2 than gasoline and costs only half as much? Who would not sign up for that at the end of the day?”

He put it simply, “If you are not for natural gas, you are for foreign oil or in the power sector you are for coal.”

Natural gas accounts for about 20 percent of U.S. power generation, while natural gas vehicles are not as widely used in the United States as they are in other countries. Natural gas advocates want to change both those facts.

During a question-and-answer session following McClendon’s speech, Arlington Mayor Robert Cluck asked about news reports, both local and national, regarding high levels of benzene in and around DISH, Texas, which is home to more than 10 compressor stations to which gas is sent for pressurization and distribution elsewhere. More studies are being conducted to determine the levels of toxins in the area and their cause.

“That particular story … is one that we’re still trying to get our hands around,” McClendon said. “It is a site where there are a large number of compressor stations. We don’t think that those are the cause of it, but we have read the reports and our own environmental health and safety people are studying that.”

He added, “We do deal in our business with chemicals that are harmful if treated the wrong way and it is incumbent upon us to be very careful with what we do.”

Although Barnett Shale activity has slowed in the past 16 months, McClendon said the 1,800 wells Chesapeake Energy has drilled are only a small part of what the company expects to over the life of the North Texas gas play.

“We feel like we’ve only drilled about 15 percent of the wells we will ultimately need to drill to fully develop this resource,” he said. Going forward, the company will increase its focus on Tarrant County development and less so on its Johnson County acreage.