SEC Wants Increased Oil Reserve Disclosure - On Voluntary Basis - FT

[hatrack]

"Rregulators (sic)have for now ruled out changing their controversial rules on oil industry reserves amid fall-out from the Shell scandal and would prefer companies voluntarily to reveal more details. The Securities and Exchange Commission's rules date back to the late 1970s with occasional guidance updates. The industry has criticised them for being vague and out of date.

Royal Dutch/Shell, Europe's second largest listed energy group, revealed in January that it had incorrectly booked more than 4bn barrels, or 20 per cent, of its proven reserves with the SEC. Shell argues that the error was, in part, caused by unclear SEC rules.

The SEC is in the early stages of a review of the situation and is veering towards voluntary increased disclosure. This might come, oil industry experts said, particularly in relation to geographic location of reserves, as well as the success and promptness with which companies convert preliminary oil and gas findings into marketable oil.

EDIT

The SEC is encouraging all companies to explain much more about their accounting in the section of their accounts known as Management's Discussion and Analysis, or MD&A. The introduction of any regulation depends on whether companies comply voluntarily. Mr Heine said: "The division is evaluating the disclosure of oil and gas companies in light of recent developments, including the requirements of the Sarbanes-Oxley Act of 2002, the Commission's guidance of December 2003 . .. and recent market events."

EDIT/END

http://www.evworld.com/view.cfm?section=communique&newsid=5931

[whistle]

1. This should be enlightening, the Saudi Prince Bandar claims...

...that Saudi oil reserves are five times bigger then the official figures. Is that just puff or are we overly concerned about a problem that just does not exist?