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Natural gas glut, low prices, prompt Chesapeake to cut exploration and production
NEW YORK (AP) ' Faced with decade-low natural gas prices that have made some drilling operations unprofitable, Chesapeake Energy Corp. says it will drastically cut drilling and production of the fuel in the U.S.
Chesapeake, the nation's second largest natural gas producer, said Monday that its planned 8 percent production cut means the U.S. as a whole would produce the same or slightly less natural gas in 2012 than it did in 2011.
That's a change from the dramatic increase in output of recent years. Chesapeake, which produces about 9 percent of the nation's natural gas, and other drillers been tapping enormous reserves of natural gas trapped in shale formations under several states. A sharp rise in supplies has combined with mild winter weather to drive the price to its lowest level since 2002.