Feds, states probe Chesapeake for royalty-payment practice

Associated Press

WHEELING, W.Va.

Chesapeake Energy’s royalty-payment practice is being investigated by the U.S. Department of Justice and several states.

The company said in a recent regulatory filing that it has received subpoenas from the federal agency and the states seeking information on its royalty-payment practice.

The filing with the Securities and Exchange Commission also said Chesapeake’s purchase and lease of oil and gas rights in various states is being investigated. The states weren’t identified.

“Chesapeake has engaged in discussions with the DOJ and state representatives and continues to respond to such subpoenas and demands,” the company’s filing states.

Chesapeake spokeswoman Lindsay McIntyre told The Intelligencer and Wheeling News-Register that the company declined to comment beyond statements made in the filing.

The filing also said the company, along with other natural-gas producers, has been the target of various lawsuits alleging royalty underpayment.