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Chesapeake audit committee chair resigns board

Chesapeake Energy CEO Aubrey McClendon is under investigation by the U.S. Securities and Exchange Commission for a controversial perk that granted him a share in each of the natural gas producer’s wells.

SEAN GARDNER/REUTERS

Chesapeake Energy Corp. said the chairman of its audit committee has stepped down as planned following the completion of the company's probe into the financial dealings of outgoing chief executive officer Aubrey McClendon.

V. Burns Hargis, the president of Oklahoma State University, said in June he would resign after winning fewer than one-quarter of shareholder votes cast for his re-election to the board.

As audit committee head, Mr. Hargis headed the board's investigation into Mr. McClendon's potential conflicts, so he remained as a director until that probe was completed.

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Much of the committee's attention was focused on a controversial perk granting Mr. McClendon a stake in every well the company drilled. The probe was completed in February and found no "intentional" wrongdoing on the part of Mr. McClendon.

The chairman of Chesapeake's board, Archie Dunham, said Mr. Hargis led the audit committee and the recent review with the "utmost professionalism and integrity."

Louis Raspino, formerly the chief executive of oil and gas service company Pride International Inc. before its 2011 merger with Ensco PLC, will replace Mr. Hargis, the company said.

Mr. Raspino will stand for re-election at the company's shareholder meeting in June.

Chesapeake and Mr. McClendon are under investigation by the U.S. Securities and Exchange Commission related to the its Founder Well Participation Program perk for Mr. McClendon. The company also faces a U.S. Department of Justice probe into possible anti-trust violations for land deals the company made in Michigan.

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