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Gas drillers disclose risks to shareholders But not to landowners

Posted: April 23, 2012 |   Comments

As natural gas development has pushed into populated areas, gas drillers have consistently disclosed to shareholders and potential investors daunting lists of possible mishaps, including leaks, spills, explosions, bodily injury, limited insurance coverage - and death.

The reason for these warnings: federal law, enforce by the U. S. Securities and Exchange Commission, aims to protect investors against fraud by requiring companies that sell stock to disclose "the most significant factors that make the offereing speculative or risky."

But according to landowners, attorneys and industry documents, gas drillers paint a far more benign picture in the millions of unregulated transactions in which they persuade landowners to lease their property for drilling in exchange for a share of the proceeds. In its filings with the SEC, Oklahoma City-based Chesapeake Energy Corp., the nations second-largest natural gas producer, proudly called its aggressive pursuit of these leases a multi-million-acre "land grab."

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