HOUSTON, Feb 4 - Large oil companies such as Exxon Mobil Corp (XOM.N) snapping up shale-gas acreage overseas will likely find it hard to develop that land due to constraints such as infrastructure availability, the CEO of Chesapeake Energy Corp (CHK.N) said on Thursday.
"I think they will have a hard time over there at the end of the day," Chesapeake Chief Executive Officer Aubrey McClendon said at the Credit Suisse Energy Summit in Vail, Colo.
McClendon, whose Oklahoma City, Okla.-company secured the right to drill for natural gas on 14 million acres in shale formations in the United States, said it will be hard for the oil majors who lost out in the domestic rush to catch up overseas.
"I don't see the world being swamped by shale gas in the next 10 years," McClendon said in remarks broadcast over the Internet.
He noted he has yet to see a formation overseas that has the potential to rival those found in the United States.
To successfully develop a shale gas basin a company needs infrastructure such as processing facilities, indigenous demand for gas and favorable commercial terms. Without those factors, many basins around the world are eliminated right away, the executive said.
In fact, Chesapeake and its joint venture partner Statoil ASA (STL.OL) have narrowed their search for an overseas shale play to about 15 basins, down from an initial survey of about 200, McClendon said.
Exxon and ConocoPhillips (COP.N), the third largest U.S. oil company, are building big acreage positions in countries such as Poland and Germany in a search for formations that hold vast amounts of natural gas.
Chesapeake shares fell more than 5 percent, or $1.41, to $24.42 in afternoon trading on the New York Stock Exchange. That decline compares with a drop of about 4 percent in the Philadelphia Stock Exchange's index of natural gas companies .XNG.
"I think they will have a hard time over there at the end of the day," Chesapeake Chief Executive Officer Aubrey McClendon said at the Credit Suisse Energy Summit in Vail, Colo.
McClendon, whose Oklahoma City, Okla.-company secured the right to drill for natural gas on 14 million acres in shale formations in the United States, said it will be hard for the oil majors who lost out in the domestic rush to catch up overseas.
"I don't see the world being swamped by shale gas in the next 10 years," McClendon said in remarks broadcast over the Internet.
He noted he has yet to see a formation overseas that has the potential to rival those found in the United States.
To successfully develop a shale gas basin a company needs infrastructure such as processing facilities, indigenous demand for gas and favorable commercial terms. Without those factors, many basins around the world are eliminated right away, the executive said.
In fact, Chesapeake and its joint venture partner Statoil ASA (STL.OL) have narrowed their search for an overseas shale play to about 15 basins, down from an initial survey of about 200, McClendon said.
Exxon and ConocoPhillips (COP.N), the third largest U.S. oil company, are building big acreage positions in countries such as Poland and Germany in a search for formations that hold vast amounts of natural gas.
Chesapeake shares fell more than 5 percent, or $1.41, to $24.42 in afternoon trading on the New York Stock Exchange. That decline compares with a drop of about 4 percent in the Philadelphia Stock Exchange's index of natural gas companies .XNG.
