Editor’s Note: This is Steve Horn’s latest piece that originally appeared over at DeSmogBlog. Check out more of Steve’s work from DeSmogBlog and give everyone at DeSmogBlog some love – visit their site for some of the best research debunking misinformation about climate science on the web. Also, you can check out Raging Chicken Press’s coverage of Aubrey McClendon’s misdeeds over the past few years RIGHT HERE.
Former Chesapeake Energy CEO and Founder Aubrey McClendon is back in the hydraulic fracturing (“fracking”) game in Ohio’s Utica Shale in a big way, receiving a permit to frack five wells from the Ohio Department of Natural Resources on November 26.
“The Ohio Department of Natural Resources awarded McClendon’s new company, American Energy Utica LLC, five horizontal well permits Nov. 26 that allows oil and gas exploration on the Jones property in Nottingham Township, Harrison County,” a December 6 article appearing in The Business Journal explained. “In October, American Energy Utica announced it has raised $1.7 billion in capital to secure new leases in the Utica shale play.”
The $1.7 billion McClendon has received in capital investments for the purchase of 110,000 acres worth of Utica Shale land came from the Energy & Minerals Group, First Reserve Corporation, BlackRock Inc. and Magnetar Capital.
McClendon — a central figure in Gregory Zuckerman’s recent book “The Frackers” — is currently under investigation by the U.S. Securities and Exchange Commission. He left Chesapeake in January 2013 following a shareholder revolt over his controversial business practices.
In departing, he was given a $35 million severance package, access to the company’s private jets through 2016 and a 2.5% stake in every well Chesapeake fracks through June 2014 as part of the Founder’s Well Participation Program.
Power Mapping McClendon’s New Venture
The former Exxon CEO’s son John Raymond is the Managing Partner, Chief Financial Officer, and Chief Executive Officer of Minerals & Energy Group, currently the largest capital investor in McClendon’s start-up venture. He is also a partner McClendon’s new venture. Ryan Turner, Chesapeake’s Stock Plan Manager has also joined the team as a partner.
“Mr. Eads…is a prince of this world,” the New York Times reported in October 2012. “His financial innovations helped feed the gas drilling boom, and he has participated in $159 billion worth of oil and gas deals since 2007.”
Eads maintained tight financial ties with McClendon when he was at the helm of Chesapeake Energy. The flow chart below depicts the financial and career ties binding Eads and McClendon.
High Stakes Game
In teaming up with Lee Raymond, the former CEO of ExxonMobil — notorious for its role in funding climate change denial — and his brother John, McClendon has shown he is back in Ohio ready to play ball.
But a recent Environmental Integrity Project report indicates the life-cycle climate change impacts of fracking are more severe than previously thought.
With the U.S. Navy predicting an ice-free Arctic summer by 2016 due to climate change, it’s a ball game with undeniably high stakes.