WHEELING, W.Va. — Southwestern Energy Co. officials plan to spend nearly $30 billion developing West Virginia oil and natural gas over the next 20 years, while fellow driller Antero Resources is spending more than $1 billion in the Mountain State this year alone.
However, during Wednesday’s West Virginia Oil and Natural Gas Association conference at Oglebay Park, Southwestern Chairman and CEO Steven L. Mueller and Antero Vice President Al Schopp acknowledged their industry faces numerous challenges amid an environment of depressed selling prices and opposition from extreme environmentalists.
“There is enough gas here to do anything you want to do in West Virginia,” Schopp said, adding that his Denver-based firm now controls about 390,000 acres in the state, including significant holdings in Wetzel and Tyler counties.
“We were not the first guy in, but we want to be the last guy out,” he said of the driller that also operates in Belmont and Monroe counties on the other side of the Ohio River.
Mueller’s firm continues proceeding with its work throughout the Mountain State in the aftermath of purchasing the assets from Chesapeake Energy for $5 billion last year.
Combined with the $24 billion Southwestern President and Chief Operating Officer William Way recently said the company will use for operations over the next two decades, the driller’s expenditures would approach $30 billion.
“We are the third-largest producer of natural gas in the U.S.,” Mueller said, adding the firm controls about 443,000 acres in West Virginia and southwestern Pennsylvania.
Southwestern is the only horizontal driller with active operations in Ohio and Brooke counties, while it also works in Marshall and Wetzel counties.
On Wednesday, Mueller said he believes the supply of natural gas will allow firms such as his to export the liquefied form of the product at facility’s such Dominion Resources’ Cove Point terminal in Maryland. However, he believes the production will help the U.S., and West Virginia specifically, attract new business.
“We’ll see businesses coming here,” he said. “Not only are we going to have LNG exports leaving the country, we are going to see companies coming here.”
Mueller said his firm’s acquisition of the Chesapeake acreage last year is a sign of the times because there are just so many companies working in the oil and natural gas fields.
Regarding company’s such as his that perform the exploration and production aspect of the industry, Mueller said, there are more firms doing this now than at anytime in history, so he believes “consolidation is inevitable.”
In terms of industry opposition, Mueller and Schopp said environmental activists are becoming more organized and aggressive.
“Their new target is radioactivity,” Schopp acknowledged of concerns over the relatively small amounts of uranium, radium and plutonium that can be found in drill cuttings.
Meanwhile, Dominion Director of State and Government Affairs Robert Orndorff said investments by companies such as Southwestern and Antero bolster the state’s position in global economic affairs.
“West Virginia is becoming the energy gorilla of the world,” he said.
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