Energy & Environment

Ex-head of gas company charged with conspiracy

Federal prosecutors are charging Aubrey McClendon, co-founder and former chief executive of natural gas driller Chesapeake Energy Corp., with conspiring to rig bids for drilling leases.

The Department of Justice (DOJ) said late Tuesday that McClendon between 2007 and 2012 orchestrated a deal between two companies in which they did not bid against each other for leases in northwest Oklahoma.

{mosads}The winning company would then give interest in the lease to the other firm.

“His actions put company profits ahead of the interests of leaseholders entitled to competitive bids for oil and gas rights on their land,” Bill Baer, assistant attorney general for Justice’s antitrust division, said in a statement.

“Executives who abuse their positions as leaders of major corporations to organize criminal activity must be held accountable for their actions.”

DOJ filed an indictment against McClendon in an Oklahoma City-based federal court after a grand jury decided that there is enough evidence to proceed with the case.

Prosecutors didn’t say how many charges were filed or if other individuals are accused in the scheme.

McClendon forcefully denied the allegations.

“The charge that has been filed against me today is wrong and unprecedented,” he said in a statement.

“Anyone who knows me, my business record and the industry in which I have worked for 35 years, knows that I could not be guilty of violating any antitrust laws. All my life I have worked to create jobs in Oklahoma, grow its economy, and to provide abundant and affordable energy to all Americans.”

McClendon left Chesapeake three years ago amid a shareholder revolt and has since founded another energy company.

In its own statement, Chesapeake said it has been cooperating with the federal investigation in exchange for leniency and has taken steps to address issues that arose during McClendon’s tenure. The company said it does not expect to be prosecuted or fined for the alleged conspiracy.

DOJ said the charges are the first to come from a wide-ranging investigation into price fixing, bid rigging and other anticompetitive actions in the oil and natural gas industry.

Tags Chesapeake Energy Natural gas

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