The former CEO of Chesapeake Energy, Aubrey McClendon, died in a car crash today in Oklahoma. He died instantly in the crash and his car caught on fire shortly after. He had just been indicted yesterday for rigging oil bids and was disputing the charges. His death is already causing conspiracy theories and questions of suicide to circulate the Internet. Yesterday, after his indictment was announced, Bloomberg Business started an article with the words: “Aubrey McClendon has been called a pioneer and a natural gas evangelist. Now he might just be the architect of his own destruction.” People are now wondering if he literally did bring about his own end, just one day later.
Here’s what you need to know.
1. ‘He Pretty Much Drove Straight Into the Wall,’ Officials Said
McClendon, 56, was in Oklahoma City when he crashed and died in a fiery car wreck on Midwest Blvd., between Memorial and 122nd Street, KFOR reported. The one-car wreck happened early on Wednesday morning. Capt. Paco Balderrama said that McClendon was traveling well over the posted speed limit. He was driving at a “high rate of speed.”
Officials are still investigating the wreck, but said that it appeared McClendon died instantly, KFOR reported. Balderrama said:
He pretty much drove straight into the wall. … He went left of center, went through a grassy area right before colliding into the embankment. There was plenty of opportunity for him to correct and get back on the roadway and that didn’t occur.”
The Mayor of Oklahoma City released this statement today:
McClendon’s 2013 Chevrolet Tahoe exploded and was engulfed in flames shortly after it hit the wall. It didn’t appear that McClendon tried to stop. He also wasn’t wearing a seatbelt, CNBC reported. A “medical event” was possibly the cause of the crash, but police don’t yet know the exact cause of death.
2. McClendon Was Just Indicted Yesterday for Conspiring to Rig Oil Bids And Was Supposed to Appear in Court Today
McClendon was just indicted by a federal grand jury less than 24 hours before the crash. He was charged with orchestrating a conspiracy between two large oil and gas companies not to bid against each other for leases in northwest Oklahoma, KFOR reported. The conspiracy allegedly happened between December 2007 and March 2012. He was CEO of Chesapeake Energy at the time.
McClendon was scheduled to appear in court today, The New York Times reported.
The case against McClendon is complex, but essentially it’s alleged that two companies conspired ahead of time on who would win leases in northwest Oklahoma. The winning bidder would then give an interest in the lease to the company that didn’t “win.” The companies aren’t named in the indictment, they’re just called Company A and Company B, Bloomberg Business reported. The allegation is that McClendon was CEO, president, and director of Company A until at least 2012 and helped orchestrate the whole scheme. The conspiracy is a violation of the Sherman Act and carries a maximum sentence of 10 years and a $1 million fine for individuals.
As for Chesapeake itself, its spokesman Gordon Pennoyer said the company was cooperating with prosecutors and received immunity from the Justice Department that shields companies from criminal prosecution if they’re the first to report an antitrust violation, according to Bloomberg Business. This raises the question of whether Chesapeake had turned in McClendon, the company’s own founder, to the federal government.
On Tuesday, after his indictment, McClendon released a statement denying the charges against him as wrong and unprecedented, KFOR reported. His statement read, in part:
I have been singled out as the only person in the oil and gas industry in over 110 years since the Sherman Act became law to have been accused of this crime in relation to joint bidding on leasehold. Anyone who knows me, my business record and the industry in which I have worked for 35 years, knows that I could not be guilty of violating any antitrust laws. All my life I have worked to create jobs in Oklahoma, grow its economy, and to provide abundant and affordable energy to all Americans. I am proud of my track record in this industry, and I will fight to prove my innocence and to clear my name.”
The indictment wasn’t the only legal trouble that McClendon had recently faced. Chesapeake also sued him for theft of secrets after he started American Energy Partners up the street from his first company.
3. McClendon, Once One of the Highest-Paid CEOs, Had a Devastating Fall from Grace at Chesapeake Energy
McClendon co-founded Chesapeake with Tom L. Ward in 1993. He is known to be one of the greatest oil and gas wildcatters of his time, Forbes reported. He was one of the earliest entrepreneurs to grasp new drilling and fracking technologies and helped ignite the gas boom of the last decade. In fact, after he took the company public in 1993, he then built it to its peak worth of $35 billion in 2008, Bloomberg reported.
However, the success wouldn’t last long. He loaded Chesapeake with too much debt and was forced out in 2013. It was a fast and furious fall for McClendon. In 2008, he was topping AP’s list of best-paid CEOS with a package worth $112.5 million, including a $75 million bonus, Business Insider reported. But later that same year, he had to sell more than $1 billion of his own stock to meet margin calls. In just six months, the stock went from a new high of $70 to collapsing more than 75 percent. Some of this was due to collapsing gas prices, but not all. To cover the fall, McClendon borrowed heavily from Wall Street. But Reuters uncovered a potential conflict of interest in McClendon’s compensation arrangement. That, combined with Chesapeake’s debt, forced McClendon to leave in 2013.
McClendon retired from Chesapeake in 2013 and was the CEO of American Energy Partners. He was also part owner of Oklahoma City Thunder. According to Forbes, his new company AEP has also been almost wiped out after McClendon spent billions of private equity money on new oil and gas acreage.
Meanwhile, Chesapeake itself is continuing to flounder. This year, its stock dropped 39 percent. Last month rumors circulated that the company had hired lawyers for a potential bankruptcy, causing the business to lose 1/3 of its value in just one day.
4. McClendon Lived a Lavish Lifestyle And Was Related to Several Famous People, Including Kate Upton
McClendon and his wife, Kathleen Upton Byrns, were married in 1981. They have three adult children, Jack, Callie, and Will. He and Katie both attended Duke University, along with all three of their children.
McClendon wasn’t a stranger to the public eye. His great uncle, Robert Kerr, was Oklahoma’s twelfth governor and co-founder of Kerr-McGee Corp. His wife’s family founded Whirlpool, Business Insider reported. And his wife’s relative is model and actress Kate Upton.
McClendon was no stranger to living in luxury. In fact, he had such a high net worth that he was once a billionaire. McClendon had one of the best personal wine collections in the world, numbering around 100,000 bottles, Forbes reported. At one point, he even owned a six-liter bottle of 1945 Mouton Rothschild, valued at about $100,000. He ended up selling about 75 percent of his collection and profited quite well. He also once owned a rest stop in Oklahoma that had a 4-ton, 80-foot-tall bottle in front and 12,000 antique sodas, Business Insider reported.
In 2012, before he left Chesapeake, he was living incredibly lavishly. Chesapeake leased planes that took his family to Amsterdam and Paris for $108,000, counted as a business expense, Reuters reported. Nine female friends of his wife flew to Bermuda in 2010, without any McClendons with them, on the company’s dime for $23,000. Beyond that, McClendon bought two houses in Oklahoma City and then purchased a mansion on “billionaire’s row” in Bermuda. He also bought properties in Minnesota, Maui, and Colorado, along with 16 antique boats valued at $9 million. He was once called “America’s Most Reckless Billionaire.”
McClendon wasn’t just about money, though. He was also an Episcopalian who liked to quote Bible verses and email them to his employees. He had three corporate chaplains on staff when he worked at Chesapeake, Reuters reported.
5. People Are Already Wondering If There Was a Conspiracy or If It Was Suicide
Already, the Internet is teeming with rumors about the timing of McClendon’s death. Some are wondering if he committed suicide after facing the charges. Others are questioning whether some type of conspiracy was involved. Officials are still investigating the crash and exactly what happened.
In a 2011 Forbes interview, McClendon said that he had a thick skin, but he also listened to his critics and journalists:
I know it (a thick skin) has served me well over the years. However, I also think it’s very important to listen to all of your critics, whether they are journalists or others, and use their criticism for closer examination of yourself and your organization.”
Friends are taking to Twitter to mourn McClendon’s death: