Chesapeake, Encana sued in civil antitrust action
By Brian Grow and Joshua Schneyer
(Reuters) - A major Michigan landowner is suing Chesapeake Energy Corp and Encana Corp, alleging that the two energy giants colluded to rig bids for oil and gas rights in 2010.
Northstar Energy, which owns nearly 10,000 acres in Michigan's Utica-Collingwood oil and gas shale formation, filed the lawsuit against Chesapeake and Canadian firm Encana in Michigan federal court Friday.
The suit follows a series of Reuters investigations last year which triggered civil and criminal probes of Chesapeake, the second-largest U.S. producer of natural gas. In June, Reuters reported that Chesapeake and Encana, Canada's largest gas producer, worked to suppress land prices in Michigan three years ago. ( link.reuters.com/wab98s )
Reuters quoted from internal Chesapeake emails that show top executives of the two companies traded proposals to divide bidding responsibilities for nine private landowners and counties in Michigan.
Northstar was one of the private landowners discussed.
In its lawsuit, Northstar claims Chesapeake and Encana agreed to avoid bidding against each other for oil and gas rights on Northstar's acreage. The companies "formed an anti-competitive agreement and shared competitive and proprietary information" in violation of U.S. federal antitrust law and Michigan statutes, according to the lawsuit.
Northstar's lawsuit seeks treble damages, or triple the amount the plaintiffs say they lost out on due to the alleged collusion.
Attorneys for Northstar declined to comment. Chesapeake declined to comment. Encana said its own probe, completed last September, concluded that the firm hadn't engaged in collusion during land leasing in Michigan in 2010. Continued...