Chesapeake Cut CEO McClendon’s Compensation by 15% Last Year

Chesapeake Energy Corp. (CHK) cut Chief Executive Officer and Chairman Aubrey McClendon’s compensation 15 percent last year to $17.86 million in response to shareholder concerns that he was paid too much.

McClendon told the company’s board of directors in September he will participate again this year in a well- ownership program that he reported lost him more than $600 million in the past three years, according to a public filing today.

The 52-year-old co-founder of the second-largest U.S. natural-gas producer is facing investor criticism for taking out personal loans to help pay drilling costs associated with his ownership stake in Chesapeake wells, using the stakes as collateral. Chesapeake said on April 18 there is nothing improper in the loans.

During the first quarter, McClendon reported $88.1 million in net losses in the wells program after accounting for capital expenses, according to the filing. Full-year losses amounted to $315.3 million, $141.9 million and $116.1 million, respectively, for 2011, 2010 and 2009.

McClendon bought stakes in company wells in all but five quarters since Chesapeake became a publicly-traded entity in 1993, according to the filing.

The company doesn’t loan money to McClendon and is under no obligation to repay any personal loans he obtains, according to the filing.

The pay package included $13.6 million in stock awards, a $1.95 million bonus and $975,000 in salary, the Oklahoma City- based company said in the filing. Shareholders were concerned that “Mr. McClendon’s total compensation has been too high for the past few years,” according to the filing.

Exxon Mobil Corp. (XOM) is the largest U.S. producer of natural gas.

To contact the reporter on this story: Joe Carroll in Chicago at jcarroll8@bloomberg.net

To contact the editor responsible for this story: Susan Warren at susanwarren@bloomberg.net