“If you decided, I’m going to pass on the Barnett, pass on the Haynesville, pass on the Marcellus, and you were going to wait for the next four or five–there won’t be any,” McClendon said Wednesday during the company’s annual meeting with analysts, referring to tight, hydrocarbons-rich rock formations in Texas, Louisiana and the U.S. Northeast, respectively. “By the end of 2011 it will be over. There won’t be any basins that have escaped investigation.”

The comments come three days after Chesapeake agreed to sell a third of its interest in south Texas’ Eagle Ford shale formation to Chinese state-run Cnooc Ltd. (CEO) for $2.16 billion in cash and drilling funding.

Shale formations were believed to be impractical sources of fossil fuels until recent years. Technological advances in hydraulic fracturing–shattering the rocks to allow oil and gas to seep from the cracks–and horizontal drilling have unlocked vast reserves and prompted international companies to scramble for entry into the field pioneered by independent firms like Oklahoma City-based Chesapeake.

McClendon said Chesapeake will continue to court joint venture partners for its interests, including those in the Niobrara shale in northeast Colorado and the Permian Basin in west Texas. And Chesapeake may sell its expertise to other companies considering shale plays overseas.

But Chesapeake isn’t planning any foreign investments, McClendon said.

We aren’t going to Poland, we aren’t going to Canada,” he said. “In terms of spending Chesapeake capital overseas, I don’t see it.”

Today, in the news and on the internet there is discussion about drilling for natural gas and our water supply. There is a common perception that shale gas development used a lot of water and may impact the drinking water quality due to hydraulic fracturing. The quantity of water needed to drill and fracture a horizontal shale gas well commonly ranges from about 2 million to 4 million gallons, depending on the geologic formation.

These volumes may seem very large to you, but I assure you that they are small by comparison to some other uses of water, such as agriculture, electric power generation, and municipalities. These volumes of water also generally represent a small percentage of the total water resource use in each shale gas area.

Calculations indicate that water use for shale gas development will range from less than 0.1% to 0.8% of total water use by basin.

In some shale gas areas, the water needs may challenge supplies and infrastructure. As operators look to develop new shale gas plays, communication with local water planning agencies, state agencies, and regional water basin commissions can help operators and communities to coexist and effectively manage local water resources. A successful technique would be identification of supplies that do not interfere with the community needs. Similarly the concerns for fracturing fluid contaminating water may be low since fracturing fluid is 95% water and 5% chemicals. The service companies doing a hydraulic fracturing job ensure through state of the art monitoring systems that fracturing fluid does not leak into fresh water aquifers.

The long-term sustainability of shale gas operations in a given region depends on several factors such as: working closely with the local, state, and federal regulatory environment, coping with the stress placed on the local fresh water supplies and effective and economical wastewater management plans.

To date, not a single case of water aquifer contamination or excessive use of water straining public supply of water has been observed or reported in the United States. The role natural gas is playing in transitioning America’s energy in a more sustainable direction and thereby ridding us of our dependence on foreign oil. Natural gas is a “bridge” fuel, it’s domestically abundant, it’s cheap, and it’s clean so we should give it the go-ahead as our breakthrough solution to oil. Shale gas is the future of our gas supply and we need to encourage everyone to move to natural gas.

If you live in an area with a shale formation near you, we would love to hear from you about your views on natural gas and your local water supplies.

C. Keddy