Chesapeake Energy Corporation (CHK), Devon Energy Corp (DVN): Is the Utica Just Full of Hot Air?

Gulfport is certainly seeing some of the best producing wells in the play. Its first 14 wells averaged an initial rate of production of 807 barrels of condensate, 7.8 million cubic feet of natural gas and 946 barrels of natural gas liquids per day. While many of its peers have been shedding acreage in the Utica, Gulfport increased its acreage in the play by about 20% by spending $220 million to add 22,000 acres to its position.

So, while it would appear that there is much more gas than oil in the Utica, that doesn’t mean the play is a complete disappointment. Sure, this doesn’t suit the liquids-growth strategies of both Devon Energy Corp (NYSE:DVN) and Chesapeake Energy Corporation (NYSE:CHK), but the high-value liquids it does have represent a solid opportunity for Gulfport. The company and several smaller peers, including Magnum Hunter Resources Corp (NYSE:MHR) which just started drilling its first well this year, believe that ample profit can be made by drilling the liquids sweet spot in the play. While that means that the Utica might not be the best thing to hit Ohio since the plow, for the right producers it still looks like it will be a very profitable play.

The article Is the Utica Just Full of Hot Air? originally appeared on Fool.com and is written by Matt DiLlalo.

Motley Fool contributor Matt DiLallo has no position in any stocks mentioned. The Motley Fool owns shares of Devon Energy and has the following options: Long Jan 2014 $20 Calls on Chesapeake Energy, Long Jan 2014 $30 Calls on Chesapeake Energy, and Short Jan 2014 $15 Puts on Chesapeake Energy.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.