text: **What advantages does CHK’s unique vertical integration strategy provide?**
  Chesapeake has built a large inventory of low-risk natural gas and liquids-rich plays that we plan to develop 
  aggressively over the next two decades. As a result, we know that our company will consistently utilize a tremen- 
  dous (and growing) amount of oilfield services for this resource development. This high level of planned drilling 
  activity will create value for the provider of oilfield services, and Chesapeake’s strategy is to capture a portion 
  of this value for our shareholders rather than transfer it to third-party vendors whose interests and investments 
  are not always aligned with ours. To date, Chesapeake has invested in drilling rigs, rental tools, water manage- 
  ment equipment, trucking, compression equipment, midstream services, and most recently pressure pumping and 
  fracture stimulation equipment. Chesapeake’s activities require a high level of planning and project coordination 
  that is best accomplished through vertical integration and ownership of the oilfield services we utilize. This approach 
  creates a multitude of cost savings, an alignment of interests, operational synergies, greater capacity of equipment, 
  increased safety and better coordinated logistics. In addition, Chesapeake’s control of a large portion of the oilfield 
  service equipment it utilizes provides a unique advantage to control the timing of leasehold development. Simply 
  put, faster development of resources maximizes the present value of leasehold. This has been a key advantage for 
  Jeff Fisher 
  Senior Vice President – Production 
  
  Chesapeake over the past three years as the company has monetized leasehold investments at premium values through our joint ventures. 