HOUSTON (Dow Jones), Oct. 30, 2009
Chevron Corp. is confident in its ability to exploit shale gas in the U.S. despite the challenges this type of resource poses for oil major companies, the head of the company said Friday.
"Our drilling organization and our company is quite capable of multiple-well programs," Chief Executive David O'Reilly said on an earnings conference call. "We have demonstrated that capability."
Taking full advantage of the vast shale gas deposits in the U.S. is seen as a challenge for large producers. Shale gas is trapped in rocks formations, requiring intensive horizontal drilling to be unlocked -- a different set of skills than the oil giants have acquired developing large, massive oil projects based on vertical drilling. Independent, smaller producers are the ones that have been able to produce domestic shale gas successfully.
O'Reilly said Chevron is trying to replicate its experience drilling multiple wells in the Gulf of Thailand where it is now producing conventional natural gas.
"I feel pretty confident that it can be done," O'Reilly said. "But we have to be able to do that on scale to move the needle."
Copyright (c) 2009 Dow Jones & Company, Inc.
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