MDN launches a new poll today. Over the past several weeks, Chesapeake Energy has been in the midst of a public relations storm. Chesapeake operates a program called the Founders Well Participation Program (FWPP) which allows CEO Aubrey McClendon to invest his own money, and reap the financial rewards, of up to a 2.5 percent stake in every well drilled by Chesapeake. He must help fund his 2.5 percent of drilling costs. Reuters disclosed a few weeks ago that McClendon has been borrowing—big time—in order to meet his obligations to the program. He has borrowed (i.e. mortgaged his interest) to the tune of $1.1 – $1.4 billion, depending on the news source.
After coming under heavy criticism, the Chesapeake board decided last week to allow the FWPP program to expire in 2015, when the current agreement runs out with McClendon. The critics have grabbed their metaphorical bullhorns (via the mainstream press) and continue to pound Chesapeake and McClendon, who both say there’s nothing wrong or even inappropriate with the program, and with McClendon’s borrowing to fund his portion of the program. But some analysts are nervous and whispers of “is this the next Enron house of cards” keep circulating.
MDN has gone on record saying we wouldn’t bet against McClendon. He’s come through tough PR spots before and continues to be the poster child for the shale gas boom in America. But MDN does wonder, is this latest “revelation” a bridge too far? Will the anti-fracking mainstream media hound this to the point McClendon has to step down as CEO of Chesapeake? And so this week’s poll questions asks:
Will Aubrey McClendon be the CEO of Chesapeake one year from now?
Head on over to the right side of any page in the website and cast your opinion now. And if you’re so moved, leave a comment below with your reasoning.