Chesapeake may have made its natural gas bed, but that doesn’t mean the company intends to sleep in it.

That was one of the takeaways from CEO Aubrey McClendon’s standing-room-only Howard Weil Energy Conference presentation in New Orleans March 26.

America’s Champion of Natural Gas is now looking to champion natural gas demand even while cutting 50 rigs out of its gas drilling efforts and reducing 2012 dry gas capital spending, net of drilling carries, by 70% to $900 million.

It’s the smallest amount the profligate Oklahoma City independent will spend on dry gas drilling since the pre-joint venture days of 2005.

In the end, the only Chesapeake dry gas rigs left standing will be six each in the Haynesville and Barnett, and another 12 in the northeast Pennsylvanian Marcellus play.

With all that said, one would expect a McClendon presentation heavily focused on oil and liquids.

But one would be wrong.

Instead the Chesapeake CEO spent more than half the allotted time discussing his bullish outlook for natural gas and reprising a storyline from the great blues artist Willie Dixon, who famously moaned: “I can’t quit you baby, but I got to put you down a little while.”

Only the tune McClendon carried noted “U.S. natural gas is the most underpriced, undervalued asset in the world today.”

McClendon’s bullish thesis suggests U.S. natural gas production will roll sometime in 2012 or 2013 as shale gas follows gas rig counts lower. The CEO pooh-poohed analyst projections that associated gas from liquids would either offset the decline, or even increase overall gas production, which happened in the aftermath of the 2009 collapse in natural gas drilling.

“There is no possible chance,” the ever-loquacious McClendon unequivocally claimed.

Instead, McClendon outlined recent developments on the gas demand side, suggesting the nation’s industrial sector was stepping forward to consume cheap natural gas even as the oil and gas industry nears commercialization of a Gas-to-Liquids (GTL) effort in Louisiana that could consume 800 MMcfed, and an innovative biofuel plant, again in Louisiana, that could draw another 200 MMcfed, during the second half of the current decade.

And that’s even before electric utilities displace coal through a 10 to 15 Bcf/d switch to gas over the next decade, North American gas nears export in the form of LNG by year-end 2015, and transportation demand kicks in, according to the McClendon thesis.

Although Chesapeake has not repented its contribution to the gas over-supply problem (the company represents 9% of U.S. gas production and contributed one third, or 4.2 Bcf/d of the 14 Bcf/d increase in gas production over the last five years), it has agreed to some public penance.

McClendon noted that Chesapeake provided $160 million of the $400 million investment in Clean Energy Fuels Inc., which will add natural gas refueling pumps to 300 truck stops as part of a nationwide comprehensive network that will enable trucks to travel coast to coast on natural gas.

Chesapeake has also invested $150 million in the Sundrop Fuels Inc., Louisiana plant that will convert natural gas and waste biomass at high temperatures into “tank-ready green gasoline”, and is working with manufacturers to develop a CNG home-refueling appliance that could be installed for $1,500 in the future versus $5,000 today.

Chesapeake, according to McClendon, has also invested $50 million in a program that will add CNG refueling pumps to 200 existing stations nationwide at a cost of $250,000 per station.

Finally, Chesapeake plans to roll out its self-developed Diesel Natural Gas technology in 2012 (pending certification) that will retrofit diesel engines to run on a blend of natural gas and diesel.

Chesapeake developed the technology to reduce costs from the one million gallons of diesel fuel the company burns daily.