Posted on 03/04/2016 9:26:34 PM PST by huckfillary
I was shocked and saddened yesterday to hear of the tragic death of Aubrey McClendon. McClendon died instantly when his car crashed into a aviaduct on Midwest Boulevard in Oklahoma City, the day after his indictment by a federal grand on charges of violating antitrust laws from 2007-12 while the CEO of Chesapeake Energy. McClendon died as he lived—pedal to the metal, without a seat belt.
Aubrey McClendon is not a household name. For those unfamiliar with his life and work, McClendon was perhaps the nation’s leading proponent for hydraulic fracturing techniques. More than anyone he is responsible for the fracking revolution of the last decade and the energy independence we now enjoy.
McClendon was driven to success and achievement probably from the day of his conception. As a teenager, he started a lawn- mowing business. Through it, he met Shannon Self, who, with McClendon, would sit on the Board of Chesapeake Energy, a giant in domestic energy production.
After graduating from Duke in 1981, McClendon took a job as an accountant, then as a landman with Jaytex Oil and Gas. He left a year later to pursue his own business in the oil and natural gas industry. A year after that, he and Tom L. Ward “threw in together” their initial venture into oil and gas. In 1989, they founded the Chesapeake Energy Corporation with two wells in Garvin County, Oklahoma. They were 29.
McClendon focused on drilling wells into unconventional reservoirs, becoming an early adopter of horizontal drilling and hydraulic fracturing techniques. His focus on these techniques led to his being called a “visionary leader” in the oil and gas industry.
He took Chesapeake public in 1993; in the following three years its stock was the most successful in the country, rising 274% in value from 1994-97. In 2005, Forbes named McClendon one of the country’s top-performing executives; by 2008 he was the highest-paid CEO of all the S&P 500 corporations. From 2009-13 Chesapeake grew its gas production from 5 million to 2.5 billion cubic feet per day. McClendon and his geologists and landsmen aggressively scoured every nook and cranny of every potentially productive shale formation in the country for hidden or abandoned reserves. In a 2012 opinion piece on domestic energy, McClendon was described as a “hero of the American gas industry.” Chesapeake’s discovery of large reserves was directly credited as having helped reduce natural gas prices for American consumers.
McClendon was a leading proponent of natural gas, fracking, and shale drilling throughout his career. In 2010, McClendon prophetically and boldly stated of the fracking process, “We have found something that can liberate us from the influence of OPEC, that can put several million Americans back to work, and can liberate us from four-dollar-a-gallon gasoline.” Today, we are reaping the benefits of McClendon’s belief in himself and the technology he advanced and embraced. McClendon did not invent fracking, but took it to where no man had gone before.
Aubrey McClendon was, to be sure, a flawed man, a scoundrel. It’s safe to say that if he wasn’t an outlaw, he certainly operated on the edges of legality. He was once called “America’s most reckless billionaire.” He had many vocal detractors---mostly shareholders and creditors-- and a lot of Marxist academics. Many of them today are no doubt enjoying a sense of schadenfreude at his comeuppance, that the cocky wildcatter was in death really the coward they always believed he was. No longer a step ahead of the law, his line of credit had finally run out. He had finally met margin call he couldn’t meet.
Some of his detractors no doubt feel justifiably avenged, having been victimized by his alleged shady practices. Most, I’d wager, are just crass hypocrites, green with envy of a man who despite his flaws, was a game-changer on a world scale. The chattering classes reflexively think of game-changers as the preserve of popes and presidents and power-brokers, none of whom have ever created a job or a dime’s worth of wealth, while sneering at entrepreneurs , inventors, innovators, and visionaries like Aubrey McClendon, who actually worked for a living. McClendon was all of these things, and he did it with aplomb.
Despite his flaws, we owe Aubrey McClendon a huge debt of gratitude. He changed the energy dynamic in this country forever and for the better. We now know that we are sitting on an ocean of once-inaccessible energy supplies, now there for the taking because of Aubrey McClendon. McClendon also changed the world geopolitical dynamic for the indefinite future. OPEC is effectively toast; we are no longer beholden to a terrorist oligarchy for our oil. We are now exporting oil and natural gas. Two years ago, I was paying $4 for a gallon of gasoline and $4.49 for a gallon of liquid propane to heat my home. Today, I’m paying $1.89 for gasoline and $2.19 for LP. This especially benefits the poor and middle classes. One productive businessman benefits mankind more than all of the Mother Teresas who have ever marched under the banner of compassion. The next time you fill up your tank at half the cost you paid two years ago, you can thank Aubrey McClendon.
Bid-rigging? There was a class action and settlement.
I’d like to know more about this indictment, probably trumped up charges.
So did he off himself, or was he Hastinged?
Knowing our Justice dept., that wouldn’t be at all surprising.
I’m long CHK since December 23.
What a wild ride it’s been. Down 60% at one point to up 12% today.
Who needs Vegas?
Yes, he should be a household named. He changed the world, in a positive way, as much as Jobs, Gates or Obama.
And yet - still, Hillary Clinton, multiple felon, walks free...
His great uncle was the democrat governor and US Senator from Oklahoma, Robert S. Kerr. Kerr was a contemporary of Lyndon B. Johnson in the Senate and co-founder of Kerr-McGee Oil Company. You may remember Deep Rock gas stations.
My guess is the “market enhancement” Claus that ended up turning gross royalty leases into to back door net royalty leases and all the losses landowners took from steep deductions was starting to weigh on his mind too as he was looking back on his life. It is to bad people can’t just do straight up business. No excuse for taking ones own life though. Prayers out to his family. May they learn money isn’t everything.
No, I'm sure it was the "accelerated depreciation" clause on Title III off-shore assets that ended up turning deferred normalized profts into retroactive non-linear allocations that really got him brooding.
Regards,
This is the supreme challenge for a genius and visionary. Can he give all the glory back to God at the end of it all. That’s where it belongs, anyhow.
I had working interest in a few wells that Chesapeake boought that had been making me some decent income off of. As soon as they took over my income dropped to zero do to questionable operating expenses. I was able to sell my interest to them based on 3 year payout on what it had been making. I would rather have had what they had been making before they took over to continue, but something is better than nothing.
Bottom line is I am not a fan of his.
Chesapeake wanted our mineral rights and offered a ridiculous sum but the royalty deal was shady so we didn’t sell. A lot folks around us did but they never drilled just ran a pipeline.
Caps off for Deep Rock !
How do we know it was even HE in the car...? Just sayin’. ... Could be sipping a cold drink on a beach somewhere. Last I heard the M.E. didn’t verify the remains as his.
From what I’ve heard and read, that would be very un-Aubrey like.
Suicide by auto.
I got one of those ridiculous bonuses but my lease had clauses protecting me from the usual charges. They honored the lease for about 2 years then started deducting for things they shouldn't. This was when they started doing it to everyone. Luckily a few months later they sold my section to a company that honored my lease and drilled 5 more wells. Others weren't so lucky.
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