Business Report: SEC probe quizzes 30 Shell employees: “quizzed at the group's annual meeting yesterday, held concurrently in The Hague and London”

June 29, 2004

The Hague - Thirty employees of Anglo-Dutch oil company Royal Dutch/Shell Group had so far been questioned by the US Securities and Exchange Commission (SEC), which was investigating improper reserves disclosure, company executives said.

They were being quizzed at the group's annual meeting yesterday, held concurrently in The Hague and London.

Shell, the world's third-biggest publicly traded oil company by market capitalisation, did not specify who the employees were.

The SEC probe started informally after Shell first downgraded of its proven oil and gas reserves in January.

That and subsequent downgrades reduced the company's proven reserves at the end of December 2002 by 4.47 billion barrels of oil equivalent, or about 23 percent. 

Reserves are the amount of oil and gas a company expects to pump to the surface. They are a crucial measure of an oil firm's performance and future value.

The initiation of the SEC's formal, closed-door investigation in late February means its enforcement division has the power of subpoena to get information.

The reserves scandal sparked class action lawsuits in the US and prompted calls for a major shake-up of the group's complicated corporate structure.

Shareholders at the meeting were told that rebuilding Shell's depleted reserves was "a major priority", AFP reported.

http://www.busrep.co.za/index.php?fSectionId=&fArticleId=2130511