PAIR-O-GRAPHS: The Aubrey McClendon effect on U.S. energy production
There’s a new chief in OKC, and name is not Durant. This morning at embattled natural-gas fracking giant Chesapeake Energy, a new chairman was announced. Archie Dunham, former chairman of oil and gas behemoth ConocoPhillips, takes the board’s head seat on the board, one that founder Aubrey McClendon had sat in since Day 1 of the company. McClendon remains chief exec. So, at this moment of change, what has McClendon meant to American natural gas production? Supporters point to charts like the one above, showing U.S. production surging globally, recently displacing Russia at the top of the charts. McClendon’s company, along with Oklahoma City-based Devon Energy, placed early, big bets on new technology to liberate natural gas stuck in underground shale rock. Independent oil-patch commentators observe McClendon’s zeal may have obstructed his view of economics; in wildcatter fashion, his subordinates vastly overpaid for drilling leases. They racked up the debt. And in 2012 they discarded the de-facto insurance mechanism against low prices, hedging. Oklahoma City sources I talked to bet Aubrey McClendon will remain the risk-taker he always was, despite new, independent board oversight. One analyst likened the situation to retired baseball fireballer pitcher Randy Johnson: you never know if he’ll throw a strike at the right point in the count, but don’t you want him on your team?
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