Despite their company's role as a leader in uncovering and developing many of the shale plays that have radically changed the world of natural gas, a number of Chesapeake Energy (NYSE: CHK) shareholders were less than thrilled at their annual meeting Friday in Oklahoma City.

They showed disdain for what they considered to be excessive compensation approved by the company's board for its Chairman and CEO Aubrey McClendon. As a result, with the well-known proxy advisor International Shareholder Services urging that he be removed from the board, McClendon garnered about 78% of the votes, compared to the 96% he captured when he last ran in 2008. Separately, about 58% of the shareholders cast a nonbinding vote for Chesapeake's pay plan.

Not that the board failed to provide disaffected shareholders with ample justification for their pique. McClendon, who co-founded Chesapeake in 1989 with now-SandRidge Energy (NYSE: SD) CEO Tom Ward, continues to receive compensation that is not performance based. Last year, that amounted to a paltry $21 million, which ISS says is about twice that of his industry peers.

But it appears to be events tied to 2008 that continue to act as burrs under some holders' saddles. When commodities prices swooned during the second half of the year, Chesapeake stock tumbled from $74 at midyear to the mid-teens in December of that year, setting off a margin call tied to McClendon's borrowings to acquire additional Chesapeake shares. He was forced to liquidate his approximately $2 billion position in the company, but soon was granted a $75 million bonus, along with other compensation for the year.

Can pay be cogent?
Let's hope that the discontented shareholders will be mollified somewhat by a notice on Thursday that Chesapeake, the second-largest U.S. natural gas producer to ExxonMobil (NYSE: XOM), had retained Cogent Compensation Partners to review its pay practices. The firm will work with the compensation committee of the board to develop "objective performance criteria" for Chesapeake's executives.

For my money, which doesn't measure up to McClendon's, while his compensation may have been above the levels I'd bless, investors should recognize that Chesapeake contributed to enhancing U.S. natural gas discoveries, reserves, and development technologies during the past several years. The positive force that's been exerted by the company's CEO can't be ignored.

Indeed, as he noted in his letter to shareholders in the company's recently released 2010 annual report, "Chesapeake and ... other companies combined creativity, innovation and technology to reinvent the way that our industry explores for and produces natural gas and liquids." From my perspective, that sentence accurately and succinctly describes a truism for the year, and constitutes anything but self-aggrandizement.

A trio of approaches
Those investors delving specifically into Chesapeake will find a company that is involved in a three-way transition. First is an increase in production on the tremendous volume of assets that have accumulated in most of the nation's unconventional plays.

Second, and just as important, is management's determination to reconstitute the balance sheet from one that clearly was excessively leveraged to one worthy of an investment-grade rating. In light of the first and second objectives, a "25/25" plan was created, targeting a 25% reduction in debt, along with a 25% increase in production by the end of 2012. It's more than a little noteworthy that, as McClendon pointed out on the company's last earnings call, "we have already reached our 25% debt reduction goal."

Exceeding the debt reduction target was achieved in part through the sale of assets in the Niobrara shale to China's CNOOC (NYSE: CEO), with which it has also created a venture in the Eagle Ford play. At the same time, it has completed a transaction whereby its Fayetteville shale assets were acquired by Australia's giant mining and energy company BHP Billiton (NYSE: BHP).

In its third transitional approach, like many of those companies operating in the nation's unconventional plays, Chesapeake is redirecting its efforts from a significant concentration on natural gas to a natural gas and liquids balance. That clearly will mean placing increased emphasis on plays that include a liquids component, such as the Eagle Ford, the Niobrara, and the Granite Wash.

Dominating operator
It's also important for Fools studying Chesapeake and the thriving U.S. energy picture to consider the nation's key plays and the company's degree of involvement in them. As McClendon also notes in his annual report letter, the company has "dominant positions in 16 of the 20 most important major unconventional natural gas and liquids plays in the U.S." The key word is "dominant."

When looking at the major plays, Chesapeake demonstrates impressive acreage positions. For instance, it controls 600,000 acres in the Eagle Ford, 800,000 in the Niobrara, and 1.2 million acres in the massive Utica shale. And it can legitimately be credited with discovering four U.S. unconventional plays -- including the Haynesville shale, which leads all others in production -- and the Utica shale.

McClendon admits to having missed on the Williston Basin's Bakken shale. But as I described to Fools recently, Brigham Exploration (Nasdaq: BEXP) provides a compelling opportunity for participating in the Bakken. Indeed, I might throw in Marathon Oil (NYSE: MRO), especially since the company is also becoming involved in the Eagle Ford.

Hopefully, with consulting help on the scene, McClendon's compensation will become less of an issue for some Chesapeake holders. Beyond that, I'm hard-pressed to name any three other companies that provide a similar opportunity for participating in a range of unconventional U.S. plays. I strongly suggest that it be given a position on your free watchlist.