Indicted ex-CEO of Chesapeake Energy 'drove straight into wall'

The wrecked car which former co-founder of Chesapeake Energy Corp Aubrey McClendon was driving.
The wrecked car which former co-founder of Chesapeake Energy Corp Aubrey McClendon was driving.PHOTO: KWTV SKYNEWS 9
The vehicle which Oklahoma City Police Department said former Chesapeake Energy co-founder Aubrey McClendon was driving.
The vehicle which Oklahoma City Police Department said former Chesapeake Energy co-founder Aubrey McClendon was driving.PHOTO: REUTERS
Aubrey McClendon in the French Quarter in New Orleans in this 2012 file photo.
Aubrey McClendon in the French Quarter in New Orleans in this 2012 file photo.PHOTO: REUTERS

OKLAHOMA CITY (REUTERS, BLOOMBERG) - Former Chesapeake Energy chief executive Aubrey McClendon, a brash risk-taker who helped transform the US energy industry with shale gas, died when his car slammed into an overpass on Wednesday (March 2), two hours before he was due to turn himself in after being charged with conspiracy to rig bids for oil and gas leases.

He was facing up to 10 years in prison.

McClendon, 56, was alone in his 2013 Chevy Tahoe when it sped into an overpass bridge along a remote two-lane road in Oklahoma City, where it burst into flames, a police spokesman said. The cause of death will be determined later by a medical examiner, the spokesman said.

The crash occurred less than 24 hours after the US Department of Justice announced that McClendon had been charged with allegedly colluding to rig bids for oil and gas acreage while he was at Chesapeake. He had denied the charges.

At a press briefing in Oklahoma City, Captain Paco Balderrama said McClendon was traveling at "well above" the 40 mile per hour speed limit before he "pretty much drove straight into the wall". He was not wearing a seat belt.

"There was plenty of opportunity for him to correct or get back on the roadway and that didn't occur," Capt Balderrama said.

He said that it was "possible" that McClendon could have suffered some sort of medical event but added that at this point it appeared "pretty cut and dry" as to what had happened.

Bloomberg News reported on Thursday that one of McClendon's biggest financial backers, The Energy & Minerals Group, was cutting ties with him in the days before he was indicted by the US Justice Department

McClendon had raised more than US$10 billion for his new company American Energy Partners from Energy & Minerals and others after being fired from Chesapeake in 2013 after a corporate governance crisis and investor concerns over his heavy spending.

McClendon, dubbed "America's Most Reckless Billionaire" by Forbes, was known for his high tolerance for risk and debt for Chesapeake and for his lavish personal lifestyle,

For Chesapeake, McClendon went on a spending spree buying up millions of acres of land leases nationwide to expand its shale drilling.

For himself, he bought his neighbour's house near Oklahoma City and then the one behind that. He also acquired a mansion on "billionaire's row" in Bermuda and later added a larger estate. He filled cellars in three states with trophy wines, purchased 16 antique boats valued at US$9 million and became part owner of the Oklahoma City Thunder NBA basketball team.

Reuters in 2012 also reported that Chesapeake had an entire office within the company dedicated to managing McClendon's personal business. The report also revealed that the company's fleet of planes were used by the McClendon family for personal holidays. On one trip, the family took flights to Amsterdam and Paris that cost US$108,000. In another case, nine female friends of McClendon's wife flew to Bermuda in 2010 at a cost of US$23,000.

McClendon was embroiled in a lawsuit with Chesapeake which alleged that he took sensitive company data from his former company to build his new business.

Industry executives and state officials remembered McClendon as a "visionary" who ushered in a new era of US energy abundance by pursuing the hydraulic fracturing technology that would unlock decades' worth of domestic natural gas and oil resources.

Over more than two decades, he built Chesapeake from a small wildcatter into one of the world's biggest natural gas producers.

But then oil prices started crashing in the middle of 2014 sending companies like Chesapeake and McClendon's new venture AEP scrambling to pay off billions in debt and avoid potential bankruptcy. Chesapeake's stock price has tumbled more than 80 per cent in the last year.

Temasek Holdings, Singapore's state investment company, told the Straits Times on Wednesday (March 2) that it had divested entirely its US$500 million (S$700 million) stake in Chesapeake in 2013. Temasek had purchased convertible preferred shares in the company in 2010.

McClendon is survived by his wife, Katie, who is an heiress to the Whirlpool washing machine fortune and relative of the model Kate Upton, and three adult children.

With additional information from the Daily Mail