Fracking Wells Fail Big-Time While Executives Profit
By: Evan Mei
MDC Oil filed for bankruptcy eight months ago, and one of its wells has been leaking methane, a greenhouse gas, into the atmosphere at an alarming rate. Things haven’t slowed down since then, and there is the risk that taxpayers will pay the price.
Estimates have shown that it would take approximately 40 million dollars. to clean up the wells. But now, the debts of the parent company of MDC exceed the value of the assets by almost 180 million dollars.
However, months before the bankruptcy, the chief executive managed to collect 8.5 million dollars worth of consulting fees, its top leader, French investment bank Natixits, alleged in the bankruptcy court.
Oil companies have been spiralling into bankruptcy like bath toys in a whirlpool at rates never seen in history, driven by people hiding in their homes like the apocalypse is raging on outside. With entire wells abandoned, a new environmental issue is on the rise: greenhouse gases.
Yet with all of these problems, executives are still lying around, carefree, making snow angels in money.
Whiting Petroleum, a massive shale drilling company in North Dakota, filed for bankruptcy in April, but not before awarding almost 15 million to top executives. Chesapeake Energy, another shale drilling company, awarded almost 25 million to its executives. Diamond Offshore Drilling filed for bankruptcy as well, once again awarding a huge sum of money to executives, 9.8 million.
This tactic of filing for bankruptcy after awarding executives immense sums of money is not very popular. “It seems outrageous that these executives pay themselves before filing for bankruptcy,” said Kathy Hipple, an analyst at the Institute for Energy Economics and Financial Analysis and a finance professor at Bard College. “These are the same managers who ran these companies into bankruptcy to begin with,” she said.
As gas builds up in storage, companies have started flaring and venting, ways to dispose of natural gas. However, this releases loads of harmful gases into the atmosphere, intoxicating everything around it.
With wells becoming abandoned, so are safety precautions. Three workers were killed in an explosion, one seriously injured. “You have large corporations protecting and enriching their top executives, while they’re cutting corners and putting their companies in a death spiral,” said Ryan Zehl of Zehl Associates. “Ordinary Americans, the people who need the money the most, are being left behind and neglected,” he said.