CORPORATE COURAGE: CHESAPEAKE ENERGY STIFFED WV ROYALTY OWNERS - A $5 Billion Shuffle

(04/01/2014)

COMMENT By Bob Weaver

Chesapeake Energy and Charleston politicos jumped stiff-legged when a Roane County jury found the company guilty of putting it to royalty owners in a $400+ million settlement.

The class action suit was inspired by Roane resident and royalty owner, retired school teacher Garrison Tawney.

West Virginians were not the only ones taken to the cleaners by the corporate gas giant.

In the Mountain State, it was yet another chapter of extractors pillaging, leaving behind one of the nation's poorest states with the destruction of its mountains and water.

Unfortunately, most West Virginians have accepted the century-long control of the extractive and chemical companies, who have convinced many they have been done wrong, holding hostage the jobs they have offered.

The latest chapter, the lax oversight of Freedom Industries, whose chemical spill tainted the water of 300,000 West Virginians.

Corporate power in bed with politicians has generated lots of hubris, but in West Virginia, individuals are rarely punished for such behavior, the debacles ending in court and bankruptcy.

If "corporations are people too," those people are rarely punished as citizens would be.

CHESAPEAKE ENERGY'S $5 BILLION SHUFFLE

The energy giant raised the cash it needed to survive by slashing royalties it paid property owners to drill on their land.

By Abrahm Lustgarten
ProPublica The country’s push to find clean domestic energy has zeroed in on natural gas, but cases of water contamination have raised serious questions about the primary drilling method being used. Vast deposits of natural gas, large enough to supply the country for decades, have brought a drilling boom stretching across 31 states. The drilling technique being used, called hydraulic fracturing, shoots water, sand and toxic chemicals into the ground to break up rock and release the gas.

At the end of 2011, Chesapeake Energy, one of the nation’s biggest oil and gas companies, was teetering on the brink of failure.

Its legendary chief executive officer, Aubrey McClendon, was being pilloried for questionable deals, its stock price was getting hammered and the company needed to raise billions of dollars quickly.

The money could be borrowed, but only on onerous terms. Chesapeake, which had burned money on a lavish steel-and-glass office complex in Oklahoma City even while the selling price for its gas plummeted, already had too much debt.

In the months that followed, Chesapeake executed an adroit escape, raising nearly $5 billion with a previously undisclosed twist: By gouging many rural landowners out of royalty payments they were supposed to receive in exchange for allowing the company to drill for natural gas on their property.

In lawsuits in state after state, private landowners have won cases accusing companies like Chesapeake of stiffing them on royalties they were due. Federal investigators have repeatedly identified underpayments of royalties for drilling on federal lands, including a case in which Chesapeake was fined $765,000 for “knowing or willful submission of inaccurate information” last year.

Read the rest   ProPublica

THE STIFFING OF WEST VIRGINIANS

ROANE JURY NOT 'DAZZLED BY BRILLIANCE' IN ROYALTY SUIT - Company Says WV Court System Unfair

IT CAME IN BIG FOR ROYALTY HOLDERS - Jury Awards $405 Million In Roane Class-Action Suit

JUDGE EVANS UPHOLDS $404 MIL VERDICT AGAINST GAS PRODUCERS

CHESAPEAKE PUSHING FORCED POOLING - "Intent Is To Intimidate"

CHESAPEAKE SLASHING WV JOBS - McClendon Blaming Roane Verdict, Calling State "Judicial Hellhole"

GAS PRODUCER CHESAPEAKE ENERGY FINED $3.2 MIL WV WATER POLLUTION - Settlement Includes $6.5 Mil Restoration

CHESAPEAKE ENERGY CEO 'THROWN' OUT - McClendon Called State "Judicial Hellhole"

CHESAPEAKE PLAYING HARD BALL AFTER $405 MIL ROYALTY SETTLEMENT

MANCHIN WANTS TO SCRAP "SACRED" ROYALTY RIGHTS FOR WV HOLDERS

BEWARE ROYALTY HOLDERS - The Grab Is On, Rights Being Purchased Dirt Cheap

THE SKY'S THE LIMIT - Chesapeake Energy CEO Raking In $24 Million

CHESAPEAKE'S MCCLENDON GETS $75 MILLION BONUS - Reward Comes After Stock Hits Bottom

HOWLEY SAYS LEASES "BUSINESS AS UNUSUAL" - Royalty Owners May Be Getting Short-Changed


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