Chesapeake hires former SEC lawyer as compliance officer


Chesapeake Energy Corp on Monday named as chief compliance officer a lawyer the oil and gas company had previously hired to respond to an investigation by the Securities and Exchange Commission.

Patrick Craine, a partner with the law firm Bracewell & Giuliani and former attorney in the SEC's Fort Worth, Texas, office, was hired to augment the company's regulatory and legal compliance efforts, Chesapeake's new chief executive officer, Doug Lawler, said in a statement.

Continue Reading Below

Chesapeake hired Craine last year to address the SEC's inquiry into a controversial perk that granted former CEO Aubrey McClendon a share in each of the natural gas producer's wells, according to several sources familiar with the matter.

Regulators in the SEC's Fort Worth office have been looking into the Founder Well Participation Program (FWPP) that grants McClendon up to a 2.5 percent interest in every well that Chesapeake drills. He must also pay his share of well costs.

A Reuters investigation in April 2012 found that McClendon had arranged to personally borrow more than $1 billion from a big investor in Chesapeake, EIG Global Energy Partners, secured by his interest in the wells.

The Oklahoma City, Oklahoma, company's board has since said the FWPP program would end in June 2014 and also found no intentional wrongdoing on the part of McClendon.

McClendon left the company in April and Lawler took over as CEO on June 17.

(Reporting By Anna Driver; Editing by Kenneth Barry)