American Energy Partners MidStream McClendon
Looks like he running the same game he did with CHK. Now they have a midstream company. I think I read CHK used to sell to themselves to screw the mineral owner out of royalties. Is MClendon so bold he will do it again???
Also , correct me if i'm wrong but AEP is the largest lease holder in the Utica but yet AEP has no physical address or office in the Ohio Utica area that I know of. I find that disturbing.
Aubrey McClendon's American Energy Partners starts midstream company
HOUSTON, June 18
(Reuters) - American Energy Partners LP, founded by former Chesapeake Energy Corp chief executive, Aubrey McClendon, and private equity firm Energy & Minerals Group, have formed a company to invest in oil and gas pipeline and processing assets.
American Energy Midstream will invest in shale formations where the firms are operating, including the Marcellus and Utica shales in Pennsylvania and Ohio, the Permian Basin in West Texas and the Woodford in Oklahoma, the companies said on Wednesday.
Last week, American Energy Partners said it planned to buy shale assets for $4.25 billion.
The Oklahoma City, Oklahoma-based company - started a little more than a year ago following McClendon's ouster as CEO of Chesapeake - has secured $10 billion in financing commitments.
Energy and Minerals Group, based in Houston, is run by John Raymond, son of former Exxon Mobil Corp CEO Lee Raymond.
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Replies to This Discussion
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Permalink Reply by cecily cox on
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AEU is building an Ohio headquarters in Cambridge Ohio, near the airport. They may have it finished, I know they have been using the property to park their trucks. All these oil companies are ruthless, that's why you need a good o/g lawyer to back you up.
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Permalink Reply by Renee E. Dorsey on
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AEP has been advertising for employees for 8 months - office is in Cambridge, Ohio.
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Permalink Reply by 0ym9x5ag7ury2 on
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Adam,
Sorry to be the bearer of bad news again, but I stumbled onto this NARO report. It looks like theft by selling to an "Affiliate" is practiced by most producers. Take a look. I hope the state governments have enough politicians that are not on the take to put a stop to this method of operation. If not, vote them out like PA says they are going to do.
http://www.propublica.org/documents/item/1084764-naro-report-on-roy...
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Permalink Reply by bo boboski on
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That is bad news! And more bad news is; there is no guberment watchdogs that want to do anything about about it, so they will just keep doing it.
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Permalink Reply by Brad Galbraith on
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While I'm no fan of McClendon, setting up a midstream operation is no sign of wrong doing. Producers don't 'sell to themselves'. Midstream operations are always separate from production companies. With Chesapeake they had Texas Midstream which was spun off and became Access Midstream and is now a part of Williams. They transport the gas, not purchase it. They also flow gas for other small and large producers.
I fail to see the sinister motives here.
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Permalink Reply by Chris on
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I believe there are several pending lawsuits involving CHK and Access being to intermingled. I can't name any off the top of my head, I'm sure someone on here knows.
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They were completely different companies and only have contractual relationships now simply for flowing gas for CHK. Access has the same arrangement with several other producers and is of course now owned by Williams. Don't expect Williams to start drilling wells simply to transport gas in their new found midstream company (which they owned 50% of before the buyout).
As you might imagine the contracts are hotly negotiated as every penny counts when moving billions of cubic feet of NG every day.
I am not aware of any said lawsuits but that doesn't mean there aren't any.
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Permalink Reply by Chris on
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See Suessenbach Family Partnership vs. Access, CHK et al, its a $5 billion class action lawsuit. Its interesting that the Williams buyout came shortly after.
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Pretty speculative and not much in the way of hard fact out there in the handful of articles I could find. The legal publications don't expand on it much either.
Again, Williams had owned 50% of Access for several years and just recently concluded the purchase of the other 50% from GIP. I can assure you a $6 billion deal wasn't negotiated in a few weeks but had been brewing for many months, maybe over a year.
Also, Williams buying the remainder of Access won't mitigate any current legal proceedings so there's no protection there just because Williams now owns 100%..which by the way means they also 'own' 100% of the potential liability of the $5 billion lawsuit.
Would McClendon concocting some sort of screwball deal with then Texas Midstream surprise me? No, not a bit, but in this case it's not a forgone conclusion.
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Permalink Reply by Dodge Charger on
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The 'company' which transports the gas for the "small and large producers" charge the producers for their service, correct? Those charges are passed along to those with leases that include deductions for such costs. If these companies are as ruthless as perceived, I would imagine the transporting company could have different price points depending on the producing company with which they are doing 'business'.
I guess time may tell....
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Well... that's how any business works. Costs of doing business of any kind are passed along to the final customer. You typically see the separation of upstream (production), midstream (transport) and downstream (processing/distribution) because they have 3 very different business models with associated risks and costs of doing business. Midstream operations usually want to be apart from production because their risk to profitability is much less than the speculative production market.
Access, for example, was ecstatic to not be associated with CHK because of the stigma it created with other potential upstream customers, in addition to several other factors.
The diabolical scheming that seems to be perceived here just doesn't exist, the business model really won't permit it. Midstreams are typically publicly owned but at the very least have investors (in the $billions) that want to realize a profit and giving 'brother in law' deals to the producers just doesn't play well with investors.
And no, I don't work for any of them.
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Here's AEP's contact information in Cambridge:
Bill Hodgsen, HR
American Energy-Utica
D.O. Hall Business Center
1000 Utica Way
Cambridge, OH 43725
Phone: 405/418.8000
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