Mark, I've made my own and also used the commercial essence. I use
0.5 to 1.5 tablespoons per gallon, but this really does vary from wine
to wine. I've used as much as 2.5 tablespoons on a really heavy
Syrah. I don't like the oak to compete with the wine, so do not
over-do it.

To make my own, I fill a one-pint mason jar with shredded French oak
that is first dampened in water. I tamp it, but don't pack it tight.
Then I add Everclear until the oak begins to rise out of the jar, put
a lid on it, and set it in a cabinet. After about two weeks I find I
can add another half cup or so of Everclear, then put it back in the
cabinet. After 3 months (although I've forgotten it and left it in
for 5 months) I strain out the Everclear (now an oak essence) into a
dark medicine bottle and add more fresh Everclear to the mason jar.
It will continue extracting good oak flavor for about 5 or 6
strainings 15 to 18 months. I then put the shredded oak in a jelly
bag with 6-8 marbles, tie it tight, and drop it in a bulk-aging port,
leaving it there for about a year.

Jack Keller, The WInemaking Home Page
http://winemaking.jackkeller.net/