Post-Gazette: Chesapeake CEO Borrowed Against Questionable Properties

Scott Detrow

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Scott Detrow is a congressional correspondent for NPR. He also co-hosts the NPR Politics Podcast.

Detrow joined NPR in 2015 to cover the presidential election. He focused on the Republican side of the 2016 race, spending time on the campaign trail with Donald Trump, and also reported on the election's technology and data angles.

Detrow worked as a statehouse reporter for member stations WITF in Harrisburg, Pennsylvania, and KQED in San Francisco, California. He has also covered energy policy for NPR's StateImpact project, where his reports on Pennsylvania's hydraulic fracturing boom won a DuPont-Columbia and national Edward R. Murrow Award in 2013.

May 10, 2012 | 11:21 AM

Scott Detrow / StateImpact Pennsylvania

Chesapeake CEO Aubrey McClendon

The Post-Gazette forwards the story on Chesapeake Energy CEO Aubrey McClendon’s questionable land loans with a look at the West Virginia properties the drilling titan has mortgaged off.
Many of these properties, Erich Schwartzel reports, aren’t too promising:

But in Brooke County, the CEO’s personal portfolio is aligned with some of his company’s least promising assets.
One cluster of land that he has borrowed against has a sizable chunk of necessary property missing in the middle — courtesy of a neighbor who refuses to sign a lease. Another is a jagged assembling of properties that looks nothing like the other pooled units in Brooke County.
Even in the case of the most promising land units, the risk of using these oil and gas interests as collateral seems high.
Industry activity underground has slowed because natural gas prices have dipped to levels that not even the private equity firms granting the mortgages anticipated when underwriting them. And up on the surface, the promise of lucrative future drilling is compromised by the politics and drilling delays of the Marcellus region, whether it’s because of neighbors who refuse to allow drilling on their land or firms that lease land right next door.
Brooke County’s example raises the question: How valuable are the properties being used to raise this controversial capital?

Need some context on what’s going on here? Start with the Post-Gazette’s initial report on McClendon’s West Virginia leases, then check out the Reuters report that nationalized the story, and led to an SEC probe into McClendon’s activities.