The Justice Department reportedly is probing Chesapeake (CHK) and Encana (ECA) for possible...


The Justice Department reportedly is probing Chesapeake (CHK) and Encana (ECA) for possible collusion after a Reuters investigation showed top brass at the two rivals plotted to avoid bidding against each other in Michigan land deals. The state's AG office and Department of Natural Resources also are believed to be looking into the allegations.

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Comments (20)
  • HoeTamer
    , contributor
    Comments (186) | Send Message
     
    Hey wait...they were working on a joint venture. LOL
    2 Jul 2012, 03:36 PM Reply Like
  • Cherry Picker
    , contributor
    Comments (381) | Send Message
     
    So at the height of a buying frenzy they only slightly overbid?
    2 Jul 2012, 03:40 PM Reply Like
  • deercreekvols
    , contributor
    Comments (9484) | Send Message
     
    What a stand-up guy Aubrey McClendon turned out to be. Shareholders have to be so pleased with the direction he took the company!

     

    Perhaps he can share a cell with Jon Corzine if regulatory investigators would ever have the brass to bring charges

     

    Other states may want to check the "deals" they have with CHK to see if all was on the level.

     

    Any bets that Jim Cramer stays far away from this story on Mad Money?
    2 Jul 2012, 03:42 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3527) | Send Message
     
    Corzine will never go to jail. He's too connected to convict. (TCTC)
    2 Jul 2012, 06:17 PM Reply Like
  • WMARKW
    , contributor
    Comments (10786) | Send Message
     
    Yea.....just think....if the put all current and former Goldman partners in jail, there would be no one left to run the world?
    2 Jul 2012, 06:23 PM Reply Like
  • NatGasGHshale
    , contributor
    Comments (90) | Send Message
     
    Look out CHK... LA, TX, AR, PA, etc., etc., etc........
    2 Jul 2012, 03:51 PM Reply Like
  • WMARKW
    , contributor
    Comments (10786) | Send Message
     
    And WHO is probing the JUSTICE DEPARTMENT????
    2 Jul 2012, 03:52 PM Reply Like
  • russtrade
    , contributor
    Comments (8) | Send Message
     
    La and TX lawyers do have a suit against Chesapeake
    for land grabbing practices. That meaning that they sent their land agents out to buy up leases at real cheap prices before revealing
    to land-owners that they were sitting on gold and the going rate was
    25000-30000 and acre in real value. My opinion of Chesapeake is that they are crooks any way you spell it. They got rich cheating and stealing and 75% is not enough for them. They also want to steal
    as much of the land owners 25% as they can cheat them out of with vague contract language.

     

    I have no affiliation and own no stock with Chesapeake, thank God. I am a land owner though and know all about Chesapeake.
    2 Jul 2012, 04:10 PM Reply Like
  • Jack Wildcat
    , contributor
    Comments (204) | Send Message
     
    No land is worth $25,000 to $30,000 per acre, especially not for natural gas. Maybe oil but only in the best spots in America. Also, 25% is a fantastic royalty compared to many other places that are not proven reserves. Come on think about it. They overpay for everything so surprised to hear they actually underpaid for once.
    11 Jul 2012, 12:24 PM Reply Like
  • russtrade
    , contributor
    Comments (8) | Send Message
     
    This site keeps wanting me to tell something about myself?
    Ok, I am not fond of Chesapeake and i want to get in on the bashing. :)

     

    You can also blame your state regulators and legislators who seem to be in bed with the oil and gas companies. Simple legislation could help the average land owners from being conned by Chesapeake and other scoundrels.

     

    I am in Louisiana and have contacted my state Senator, hoping that he could start an investigation and create some legislation
    that would protect property owners with clear contract language.

     

    Chesapeake needs to be audited by independent auditers, from the bottom to the top and check out who their so called affiliates are. I think they pad the books and create affiliates for the purpose of making more money for themselves. Chesapeake convinced me that they are crooks, I did not start out thinking that way. Whatever happens to them that is bad, will not bring me to tears because I hate crooks and tyrants that take advantage of others to make money for themselves.
    2 Jul 2012, 04:20 PM Reply Like
  • Factzplz
    , contributor
    Comments (306) | Send Message
     
    I am a shareholder, and I am EXCEPTIONALLY pleased with the excellent job McClendon has done to build the best oil/gas company in America.

     

    Why should CHK bid against itself. The "poor guy" at the center of all of this ONLY has 20,000 acres and wanted ECA to pay him $50 million + royalties. When ECA pulled its bid, amazingly, none of the other 9,998 drilliers in the U.S. rushed in to pay him $50 million.

     

    Why not? If ECA and CHK were being played for suckers by this "poor, naive, hay-seed farmer," and they got smart, how come in three years he didn't "wow" some other company with all the oil? Perhaps, because there is not as much oil as thought, or the price is too high, or the infrastucture buildout is too costly, or pipelines are not available, or ???

     

    Sorry folks, this farmer is neither poor, stupid, or taken advantage of. If he had something of real value to sell, other companies would have "beat a path to his door."

     

    Now let's pillorize McClendon for NOT wasting shareholder money.

     

    Hey, another idea, for you Russtrade! If it is soooo lucrative that he should have been paid $30,000 per acre, why don't you and the "farmer" rent a rig and start drilling, and get your friends, family, and Facebook friends to help. Split the profit with the rig company. That way the "poor farmer" can't be cheated and stolen from as you allege (of course, with no facts).
    2 Jul 2012, 04:30 PM Reply Like
  • Cherry Picker
    , contributor
    Comments (381) | Send Message
     
    If you're happy with McClendon then you must have been smart enough to short the stock some time back. Nothing like being able to get in at post crash prices. From everything I've read about McClendon's behavior over the course of the past several years it's easier to conclude that he's a degenerate gambler rather than another wildcatter with a big portfolio gone squishy.
    2 Jul 2012, 05:39 PM Reply Like
  • Cincinnatus
    , contributor
    Comments (6187) | Send Message
     
    SA provides a forum where prospective buyers in a market may discuss fair value of a security. Under Eric Holder's definition that's collusion. I think McClendon is a crook for his dealings within CHK, but that doesn't mean I'm willing to bend over and let Holder ream me just because I hate McClendon.

     

    Note that this is not about price fixing - CHK and ECA are the buyers not the owners and sellers of the asset. If Holder gets his way then every auction other than hidden-bid auctions will be outlawed, because you can't permit buyers to interact for the purpose of price discovery. In fact no longer should the exchanges be permitted to publish bids, as that effectively permits buyers to collude.
    2 Jul 2012, 05:56 PM Reply Like
  • Rocksource
    , contributor
    Comment (1) | Send Message
     
    That is not an illegal practice, but smart and has been done since the beginning of the oil industry! Why would you want to bid against each other, when both already have a land position. You find out who you're bidding against and split the lease block, otherwise you could be out totally or if bidding continued, pay much more than the prospect will support.
    2 Jul 2012, 06:00 PM Reply Like
  • WPSPIKER
    , contributor
    Comments (1149) | Send Message
     
    The whole bid process almost sounds to me like they had already bought the land they felt was worth while and could be drilled in the allotted time now that we all know they both (CHK & other company have too much land to effectively drill for it at the prices Gas/Oil are at now... sounds like more SA & Recruiters are attempting to drive stock back lower. Recruiters should be investigated as they seem to every day find something they state is NEW and OH SO BAD yet industry practice or well known by anyone able to read...
    2 Jul 2012, 07:50 PM Reply Like
  • russtrade
    , contributor
    Comments (8) | Send Message
     
    Factzplz, if I wanted a joke I would follow you into the restroom
    and watch you change your diaper. Surely you cannot be serious
    about the love for the way Chesapeake operates?

     

    There is a difference in people who have ethics and those that don't. I see Chesapeake in the last of that statement.

     

    There is way too much smoke around Chesapeake for it not to be a fire. I agree with the guy who questions the justice department investigating anyone. I guess you would call it a crook investigating a crook. Notice how shareholders are all happy, just as long as the crooked gravy-train fills their little greedy pockets with money. That is not honest. I want honest money, not money made by stealing the assets of another. That is basically Chesapeake's story.
    2 Jul 2012, 09:27 PM Reply Like
  • Cincinnatus
    , contributor
    Comments (6187) | Send Message
     
    This isn't about McClendon. You're trying to turn the notion of collusion and price-fixing on it's head and claim that the buyers are price-fixing, which is pure bs. The buyers don't control the availability of the resource. If there is any price-fixing going on it is on the part of the landowners as they control the resource. In fact CHK's behavior drove prices up above where they would otherwise have been had McClendon acted responsibly and rationally. In your story the landowners are the greedy party - they were paid for leases that can't be used. And it will be CHK shareholders and ultimately consumers that pay the bill for McClendon's overpaying for leases to the greedy landowners.
    3 Jul 2012, 01:26 AM Reply Like
  • russtrade
    , contributor
    Comments (8) | Send Message
     
    Furthermore Factplz, what the heck are you talking about. I commented on the La and Tx lawyers lawsuit for land grabs.
    The farmer you speak of is up north somewhere.

     

    Maybe before you open your yap you might want to get your Factplz
    in order and make them factual as to whom you are speaking to.
    Try reading what I actually said before you make an error and
    speak to me about something I did not address. Chesapeake did pay 25-30 thousand where I am talking about, except to those they cheated prior to announcing the Haynesville Shale.
    Chesapeake and their little crooked landmen got plenty for free by fraud and that is why Lawyers in LA, TX are after them.
    If they have to pay out what they owe, perhaps your little share will go down and you won't be so happy with your crooked money gain.
    2 Jul 2012, 09:41 PM Reply Like
  • chilidog1750
    , contributor
    Comment (1) | Send Message
     
    When the buyers band together to form a consortium and they hold out for the highest bidder - that is OK. But when a company pulls back and another such as CHK steps up to the plate - that is price fixing.

     

    Perhaps if the landowners would have done their homework, checked with counsel versed in these dealings and not been a greedy..... this wouldn't be an issue today. Everyone was just wanting to get rich and stick it to the gas companies.

     

    Look at the greed with stores and property owners renting a dumpy 1000 square foot house to a gas person for $1600 a month, how about a hotel room for $2500 a month - where was Holder and the government then? No body gave a hoot. Why do we always have to bail out those who get themselves into their own demise? It is called doing your due diligence and then thinking twice before you sign.

     

    In our neck of the woods, the landowners only saw $$ signs. They figured that it was going to be free money - the oil people came in the 50's and signed leases and never came back - so it would be this time too. So in their greed - they signed for $25 an acre - now they are crying about it because their neighbors who waited got many times that amount and a much larger % of royalties.

     

    Just like everything in life - you need to be ware and if you make a stupid costly mistake - it is your fault.

     

    As a shareholder - there is lots that I don't like about CHK, but I do think that it is good business to not keep picking up leases when the price of gas is so low - did these folks pass up a lease with another company or did no one approach - suppose if CHK has to - they should pickup the lease and tie up the property with their shut in provision for $5 an acre - one can't get blood from a stone and perhaps people should realize that.

     

    Holder investigating anything is like the fox guarding the hen house - too bad Congress can't investigate the DOJ and .......
    11 Jul 2012, 05:07 PM Reply Like
  • russtrade
    , contributor
    Comments (8) | Send Message
     
    (Just like everything in life - you need to be ware and if you make a stupid costly mistake - it is your fault.)

     

    Well that sums it up for Chesapeake because they keep getting sued for their poor business practices making stupid costly mistakes in figuring that they can con all the people all the time.
    Some of the people cannot afford to sue them, but others have the means and do. Chesapeake is getting what they deserve. Boo hoo to you share-holders, same rule applies to you. You invest on greedy hopes and the vehicle you choose is even more greedy, so that's YOUR stupid costly mistake.
    13 Jul 2012, 07:22 AM Reply Like
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