Chesapeake Energy Corp filed for bankruptcy on June 28, ending the pioneer’s run leading the US shale oil and gas industry.
Founded in 1989, Chesapeake binged on debt to acquire drilling rights to 15 million acres, at one time making it the second-largest gas producer in the US. But loaded down with loans, and unable to reorient its business model toward more lucrative oil extraction, it couldn’t withstand the pandemic-related fossil fuel price crash.
Chesapeake’s woes are a mirror of its industry. Since 2010, the US shale industry has written down at least $450 billion in investments and suffered 190 bankruptcies, reports the consulting firm Deloitte. By the end of the year, the industry is expected to suffer one its worst years yet, writing down $225 billion in assets. Shale oil, likely responsible for an outsized climate impact over the last decade, could see its heyday come to an end in the US before it ever made a profit.