Chesapeake Discloses Informal Inquiry From SEC

Date : 05/03/2012 @ 4:55PM
Source : Dow Jones News
Stock : Chesapeake Energy Corp. (CHK)
Quote : 4.715  -0.125 (-2.58%) @ 2:32PM

Chesapeake Discloses Informal Inquiry From SEC

Chesapeake (NYSE:CHK)
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Chesapeake Energy Corp. (CHK) said the Securities and Exchange Commission opened an informal investigation focused on the company and its co-founder and chief executive, Aubrey K. McClendon.

The company's board this week forced McClendon to step down as chairman, bowing to pressure from shareholders amid revelations that he was receiving a controversial perk that allows him to purchase a 2.5% stake in every well the natural-gas producer drills. The perk was ended 18 months early and the board plans to name an independent chairman in the near future.

Chesapeake said the SEC asked it to retain certain documents, but noted in the request that the inquiry shouldn't be construed as an indication that any violation of federal securities laws occurred. The company added that it planned to cooperate with the SEC in responding to the inquiry.

The SEC said it declined to comment.

Chesapeake's aggressive push to develop gas and oil from shale rocks has helped create a U.S. energy boom. It and other companies have been so successful at finding natural gas that the price of the fuel recently hit a 10-year low.

Earlier this week, Chesapeake said its first-quarter loss narrowed as the company reported a smaller derivative loss from the year-ago period and as production increased.

Shares closed Thursday at $17.19 and were down 8 cents after hours. The stock is down 23% so far this year.

 
   -By Ben Fox Rubin, Dow Jones Newswires; 212-416-3108; ben.rubin@dowjones.com 

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