Chesapeake says DoJ investigating three well sites

Reuters News

2/29/2012 7:18:46 PM - Reuters News

(Reuters) - Chesapeake Energy Corp, the second-largest U.S. producer of natural gas, said the U.S. Department of Justice is investigating possible criminal violations under the Clean Water Act (CWA) at three well sites in West Virginia.

Chesapeake has responded to a subpoena request for documents related to four sites in the state that are already subject to CWA compliance orders from the Environmental Protection Agency, the company said in its annual regulatory filing on Wednesday.

"We understand that the U.S. Department of Justice (DOJ) is investigating possible criminal violations of and liabilities under the CWA with respect to three of the four sites," Chesapeake said. "We are cooperating with the DOJ's investigation."

Under the CWA, civil penalties can be as high as $37,500 per day, per violation, and possible criminal penalties range from $2,500 to $25,000 per day.

"We believe that resolution of the EPA's compliance orders and the DOJ's investigation will each include monetary sanctions exceeding $100,000 but are unable to estimate the amount of any fines that might be imposed in these matters," Chesapeake said.

It was unable to give a timeline for conclusion of the DOJ investigation.

(Reporting by Anna Driver in Houston, Braden Reddall in San Francisco and Edward McAllister in New York; Editing by Phil Berlowitz and Bob Burgdorfer)