Former Chesapeake CEO indicted
Note: After our original story aired, CNBC reported that Aubrey McClendon died in a car accident.
Aubrey McClendon co-founded Chesapeake Energy in 1989. Fifteen years after the company went public in 1993, it was already regarded of as one of the more important oil and gas companies in the U.S., often spoken in the same sentence as Exxon-Mobile and Chevron. McClendon was all-in on shale and started grabbing up leases as fast as he could.
Gregory Zuckerman, author of a book about this called “The Frackers,” said these charges could signal a change in anti-trust litigation.
“Aubrey McClendon is the pioneer of this American energy renaissance,” he said. “He was on top of the world and now he’s being charged, and, it is really surprising that the Justice Department is going after him and not the company he led while doing these alleged acts.”
The charges allege McClendon helped organize deals between Chesapeake and another large energy company (yet unnamed) that were decided ahead of time. The charges said McClendon and the other energy executives would decide who would win the leases and then the winning bidder would give part of that land to the other company. McClendon denied all wrongdoing.
Gregory Zuckerman also pointed out out that competing oil and gas companies often work closely together.
“The argument is that this happens all the time,” he said. “But, that said, if they like in other industries conspired to pay as not high as they could have paid, then there could have been a law that was broken here.”
The punishment for breaking these laws isn’t light. McClendon could be looking at 10 years in prison and $1 million for each conviction, should it come to that.
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