One of the pioneers of the hydraulic fracturing boom died in a fiery car wreck in Oklahoma City on Wednesday, a day after federal prosecutors accused him of rigging bids on oil and gas leases.
Aubrey McClendon, the former CEO of Chesapeake Energy, died when his 2013 Chevy Tahoe crossed the median of a road on the outskirts of Oklahoma City and slammed into a freeway embankment at high speed, police said. McClendon, 56, was also the co-owner of the NBA's Oklahoma City Thunder, which plays in an arena named for his old company.
"His vehicle was engulfed in flames immediately, and he did not survive the accident," Oklahoma City police Capt. Paco Balderrama told reporters.
McClendon had just been indicted on charges of conspiring to rig bids for oil and gas leases in northwest Oklahoma, the Justice Department announced Tuesday. Prosecutors accused him of orchestrating a scheme in which companies would avoid competing against each other, keeping the prices of those leases down, in exchange for a share of the eventual profits.
"His actions put company profits ahead of the interests of leaseholders entitled to competitive bids for oil and gas rights on their land," Assistant Attorney General Bill Baer, the head of the Justice Department's anti-trust division, said in a statement laying out the charges. "Executives who abuse their positions as leaders of major corporations to organize criminal activity must be held accountable for their actions."
— CNBC (@CNBC) March 2, 2016
The charges carried a potential sentence of 10 years in prison and a $1 million fine. But in a statement issued Wednesday morning through his new firm, American Energy Partners, McClendon called the charges "wrong and unprecedented."
"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," he said. "All my life I have worked to create jobs in Oklahoma, grow its economy, and to provide abundant and affordable energy to all Americans. I am proud of my track record in this industry, and I will fight to prove my innocence and to clear my name."
Shortly afterward, McClendon's SUV slammed into a concrete abutment beneath Interstate 44 after veering across the centerline of a road on the east side of Oklahoma City, police said. He was the Tahoe's sole occupant, and was not wearing a seat belt.
An investigation into the crash is under way, and state medical examiners will perform an autopsy. But there was no immediate sign of any connection between the fatal wreck and the indictments, said Sgt. Ashley Peters, an Oklahoma City police spokeswoman.
Mike Terry, the president of the Oklahoma Independent Petroleum Association (OIPA), called McClendon "a groundbreaking pioneer" and "a true visionary whose accomplishments will long go unmatched."
"His steadfast dedication to this industry, Oklahoma and his hometown of Oklahoma City helped usher in a new era of oil and natural gas exploration in the Sooner State and across the nation," Terry said in a statement issued by the OIPA. "By focusing on unconventional resource reservoirs and the use of horizontal drilling, Aubrey helped put in motion our nation's push toward energy independence, and his use of these unconventional techniques in the development of natural gas was copied by oil and natural gas producers across the nation."
We are saddened to hear news of the death of Aubrey McClendon today. Our thoughts are with his family, friends & colleagues at this time.
— Oklahoma Oil & Gas (@OKOGA1919) March 2, 2016
McClendon was the co-founder of Chesapeake Energy, now the nation's second-largest natural gas producer. The company is not named in the indictment—butat the timeprosecutors say the bid-rigging scheme took place, McClendon was the company's CEO. He left the company in 2013 amid financial turmoil and a Securities and Exchange Commission probe and formed American Energy Partners.
The divorce was not amicable: Chesapeake sued McClendon, accusing him of taking trade secrets with him when he left. The company also pleaded no contest to bid-rigging charges in Michigan and paid a $25 million settlement over allegations dating back to 2010.
In an American Energy Partners statement, McClendon's attorneys said the charges took "practices well-known in the Oklahoma and American energy industries … and twisted these business practices to allege an antitrust violation that did not occur." Prosecutors "have wrongfully singled out Aubrey McClendon and have wrongly charged an innocent man," they wrote.
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