Thursday, July 16, 2020
As frackers hurtle toward bankruptcy, some fear taxpayers could be stuck with cleanup costs and pollution
"Oil and gas companies in the United States are hurtling toward bankruptcy at a pace not seen in years, driven under by a global price war and a pandemic that has slashed demand. And in the wake of this economic carnage is a potential environmental disaster — unprofitable wells that will be abandoned or left untended, even as they continue leaking planet-warming pollutants, and a costly bill for taxpayers to clean it all up," Hiroko Tabuchi reports for The New York Times.
There's little incentive for executives to steer companies clear of the cliff, if past examples are to judge, since many ensure that executives are paid millions with golden parachutes in the form of bonuses or consulting fees, Tabuchi reports.
For instance, in the months before Texas-based oil company MDC Energy filed for bankruptcy eight months ago, the company paid its CEO $8.5 million in consulting fees, a debtor alleged in court. The company's debts exceed its assets by more than $180 million, and it would cost more than $40 million to clean up its wells if they were permanently closed. But "as of last week, dangerous, invisible gases were still spewing into the air," Tabuchi reports.