OKLAHOMA CITY–Expand Energy Corporation may be a new name on the energy marquee, but precious few companies have a longer pedigree or a deeper technical bench in shale gas resource plays.

Expand Energy’s predecessors, Chesapeake Energy and Southwestern Energy, were early—and big—movers in unconventional gas, and their names became synonymous with plays such as the Marcellus, Utica and Haynesville. They were also innovators, helping pioneer many of the core technologies and methodologies that have become standard in both shale gas and tight oil development.

The new entity emerges as America’s premier natural gas company and ranks at the very top of the list of natural gas producers. It is concentrating all of its experiences and its expertise on a singular mission: “fueling a more affordable, reliable and lower carbon future” for citizens of the United States and every other nation on the globe.

“The world is short energy, and we produce the most important commodity for resolving that shortfall,” says President and Chief Executive Officer Nick Dell’Osso. “North America produces more natural gas than anywhere else, which puts the region in a position of being the leader to remedy this problem. We are energized by that fact and by how our company can play a significant role in it for the good of our economy and for people around the world.”

Noting that billions of people lack access to affordable, reliable and clean energy, Dell’Osso says one of humanity’s greatest challenges is effectively addressing this crisis. “We believe natural gas is the best positioned solution to answer that call,” he relates. “By safely and responsibly delivering critical energy to markets in need, Expand Energy will help address one of the great threats to human prosperity.”

Comeback Story

Two decades ago, in the dawning days of the shale gas revolution, Expand Energy’s predecessors quickly proved up the production potential of unconventional reservoirs. Within a few short years, North American natural gas market forecasts flipped 180-degrees from “chronic tightness and high costs” to long-term “abundance and affordability.” Seemingly all of the sudden, analysts went from talking about shortages to surpluses. It was one of the greatest—and arguably least celebrated—comeback stories of all time.

Expand Energy emerged from the combination of Chesapeake and Southwestern as America’s premier natural gas company and its top gas producer with a daily average volume of 7 Bcfe.

However, the reach of “U.S.-made” natural gas was very short, constrained by limited export capacity on pipelines and a handful of small liquified natural gas terminals constructed to move supplies into the American market, not ship it out. The game-changer, of course, is LNG export capacity, Dell’Osso points out.

U.S. export volumes have ramped up rapidly over the past decade, touching record highs year after year as new terminals and trains are commissioned. The world now has access to U.S. gas, and markets everywhere are taking advantage of the supply surety and affordability that American consumers have enjoyed for years. In 2025, outbound LNG cargoes from American terminals are projected to average 14 billion cubic feet a day, according to the U.S. Energy Information Administration.

Counting the announced construction projects currently under way (with a freeze on new projects lifted and even more plants on the drawing board), EIA estimates that U.S. exports will double between 2023 and 2028, helping fuel prosperity in even the most energy-strapped countries around the globe.

It takes a lot of production output to sustain that level of growth in LNG exports, let alone expansion in other domestic market sectors. That’s where Expand Energy enters the picture. The company’s fourth-quarter gas production is expected to close the year averaging nearly 6.4 Bcfe/d from the Appalachian and Haynesville Shale basins, “delivering critical energy to markets in need,” as Dell’Osso puts it.

Starring Role

One thing is certain: Expand Energy’s expansive leasehold in Appalachia and the Haynesville positions it to play a starring supply-side role for many years to come. Expand Energy’s portfolio includes 1.2 million net acres in Northeast Pennsylvania, West Virginia and Ohio and 650,000 acres in the Haynesville, where 20% of its production in northern Louisianna moves south to Gulf Coast LNG terminals servicing overseas demand centers.

“We are really excited about how all of this sets up for our company,” Dell’Osso says. “We have tremendous resources in the ground. We have a tremendously talented team that is always focused on getting those resources out of the ground and to market at the lowest cost.”

For preliminary guidance, the company estimates a 2025 capital budget of $2.7 billion to maintain daily production at 7 Bcfe. Expand Energy will run 10-12 rigs and five to six frac crews, reports Executive Vice President and Chief Operating Officer Josh Viets.

In Louisiana, the company’s midstream infrastructure and inventory depth provide growth flexibility as LNG demand grows. Expand Energy has been working eight rigs and three frac crews in the Haynesville and holds an average 91% working interest per well with average net revenue interest of 72%.

The Northeast Appalachia position includes abundant dry gas reserves in Susquehanna, Wyoming, Bradford, Sullivan, Lycoming and Tioga counties, with lateral lengths on more than 15 wells extending beyond 18,000 feet. Although gas accounts for 90% of companywide production, oil and natural gas liquids make up 35% of output in West Virginia and Ohio.

Technological Advancement

Throughout the company’s operational footprint, technological advancement will continue to drive efficiency improvements, production gains and ultimate recovery, Viets says, with the focus in 2025 continuing to be on increasing lateral lengths and optimizing completion designs.

In 2024, lateral lengths in Northeast Appalachia increased by almost 20% and drilling footage per day rose 25%, Viets notes. Southwestern drilled a lateral in Southwest Appalachia that Expand Energy believes is the longest in the Lower 48 at more than 25,000 feet, according to Viets. The ability to extend lateral lengths while successively improving drilling times is an indication of the company’s commitment to excellence in project execution and its overall focus on increasing returns on every dollar invested.

Machine learning and artificial intelligence are part of the strategy to achieve operational and performance objectives. Sophisticated AI-based analytics first deployed in the Haynesville are now being used in Appalachia as well. Example applications include monitoring mechanical condition and performance of bottom-hole drilling assemblies to avoid unnecessary pipe trips. In tandem with machine learning, another application is placing wells and predicting production performance within 2% of actual measured results.

“We continue to find ways to deploy advanced data analytics into our operations, whether that is helping us guide things like optimal well spacing or completion designs,” Viets explains. “We also see it showing up in areas like drilling, or more critically, optimizing drilling parameters through the use of advanced analytics and in our efforts to provide production surveillance and optimization within our day-to-day operations.”

Capturing Synergies

Recent estimates of the fiscal synergies from the Chesapeake-Southwestern merger were increased to $500 million per year for Expand, partly owing to the combined company’s larger scale and size. Expand Energy is headquartered on Chesapeake’s Oklahoma City campus, replete with Georgian-style architecture. The marketing and trading business is based in Houston.

Expand Energy continues to extend lateral lengths while successively improving drilling times, underscoring the company’s commitment to excellence in project execution and its overall focus on increasing returns on every dollar invested.

In the merger agreement, Chesapeake was the acquirer, tripling its proved reserve base and more than doubling its production, funding the $12.1 billion transaction with just under $8 billion of equity, the assumption of Southwestern’s $3.7 billion long-term debt, and pay down of $585 million outstanding on Southwestern’s credit facility.

After closing, Expand Energy was upgraded to investment-grade credit rating, something that especially pleases Dell’Osso, a former Chesapeake chief financial officer for 11 years who helped the company navigate a bankruptcy in the aftermath of the Covid lockdowns.

“Whether we are talking about working with utilities, working with pipelines that deliver gas to utilities, or working with Asian and European buyers of LNG, our status as an investment-grade company and the financial outlook it represents is so fundamental to how we are set up to increase people’s access to crucial energy resources,” he says.

A stronger financial position and a positive long-range outlook for gas demand allows the company to plan over years as it sets goals for creating value for employees and stakeholders, Dell’Osso insists.

“It is a fundamentally different approach to our business that we just were not afforded during years of harder times,” he comments.

All About The Team

Dell’Osso says Expand Energy will build on the combined expertise, experiences and histories of Chesapeake and Southwestern. As a standalone company, Southwestern enjoyed a 95-year history and was the first operator to kick off unconventional development in 2002 in the Fayetteville Shale in Arkansas before venturing into the Haynesville and Appalachia.

Chesapeake discovered the Marcellus and Haynesville shales in 2008 and the Utica Shale shortly thereafter during a meteoric unconventional rise that began in the Barnett Shale in North Texas in the mid-2000s. The marriage of collective experiences and capabilities will drive progress, Dell’Osso assures.

“It is all about our team,” he insists. “When you think about the history of both companies coming together and how we are positioned to succeed going forward, there is such a rich history and positive track record on both the Chesapeake side and the Southwestern side.”

Having three distinct operating areas—the Haynesville, Northeast Pennsylvania, and West Virginia and Ohio—gives Expand Energy plenty of optionality in determining where and when to drill to optimize production delivery.

The merger is part of a continuation of moves by Chesapeake in recent years to create shareholder value with divestments in the Powder River and South Texas, and acquisitions of Vine Energy and its Haynesville assets and privately held Chief E&D Holdings’ and its Appalachian position.

With the current focus on realizing value from the consolidation, Expand Energy would hold to M&A non-negotiables when future opportunities arise, Dell’Osso says. Those include assessing potential deals based on the opportunity to make the business better (not just bigger) and the chance to enhance value for shareholders and product delivery.

Dell’Osso will not rule out an expansion beyond the Haynesville Shale and Appalachia, but he says there is no need currently to look elsewhere. “We have a great asset base and we will always think creatively and constructively about anything that could make our business better, but we really like what we own,” he remarks. “We like our ability to serve many markets from the assets we own, and we like our ability to continue to create value for our shareholders through the development of those assets.”

Despite an oversupply situation in gas markets in 2024, the United States and the rest of the world will need more gas in the future, supplied partly from Expand Energy’s long runway of inventory and positions, he goes on. The goal in 2024 was to allocate capital and business activities to meet obligations while ensuring adequate production capacity to meet increasing demand in the future.

The cycle time between deciding to invest in production to getting incremental gas in the pipeline can take as much as 12 months, Dell’Osso states. The company continued to invest in long-term cycles in 2024, but also moderated and adjusted its production profile so it can be more responsive to short-term gyrations in demand patterns, he adds.

“Separating that capital investment profile from the cycle of production is how we think we can create a lot of value for shareholders, and it allows us to be more responsive to market conditions,” he details.

Making A Difference

That separation is contingent on having a significant scale of production, a strong balance sheet to invest in productive capacity and proactive hedging to mitigate risk, all of which are strategies that Expand expects to continue to apply, according to Viets.

“If you think about where both companies were historically with an aggregate capital program and the amount of production both of them could deliver, the efficiency of being able to deliver 7 Bcfe/d to the market on approximately $2.7 billion of capital is pretty impressive,” Viets emphasizes. “You are creating a lot more free cash flow and value for shareholders in that model, and you are creating 7 Bcfe/d of production for consumers with fewer dollars invested to achieve it.”

Dell’Osso points out that having three distinct operating areas—the Haynesville, Northeast Appalachia, and Southwest Appalachia—allows for plenty of optionality in determining where and when to drill and time production delivery.

Operational flexibility and a positive market outlook are reinforced by a growing understanding in the United States and elsewhere of the need for adequate energy and a growing realization that most countries have done an insufficient job of investing in energy infrastructure, Dell’Osso adds.

“The Trump administration could be quite helpful in creating better access to energy through policies that would support infrastructure growth,” he says. “We are encouraged by that.”

In the meantime, Expand Energy’s team understands that what they do matters and can make a difference at home as well as abroad. “That is a pretty empowering mission to have,” Dell’Osso concludes. “Our people understand that, and they are really proud to be a part of it.”