The New York Times: House Panel to Begin a Hearing on Shell's Reserve Scandal: “Shell officials were asked to testify, but will not, the company said.”

Published: July 21, 2004

LONDON, July 20 - The House Financial Services Committee in the United States plans to begin a hearing Wednesday on the oil reserve scandal at Royal Dutch/Shell, a move that is sure to expose the company to more public criticism, and could provide additional fuel to class-action suits.

Shell officials were asked to testify, but will not, the company said. "Through our Washington, D.C., office, we did receive an invitation to testify at the hearing, which we have respectfully declined,'' said Stuart Bruseth, a Shell spokesman.

The hearing will be focused on corporate governance in exploration and production divisions of all oil companies, said one executive who has been briefed on the agenda. It will also include discussions on whether changes need to be made to the system, the person said.

Shell is being investigated by the Securities and Exchange Commission and the Department of Justice, as well as regulators in the Netherlands and Britain. The company shocked investors when it said in January that it would cut its proven oil and gas reserve estimates - generally considered an oil company's most important asset - by 20 percent.

The news sent Shell's stock plummeting, and the company fired two top executives after an internal investigation.

Shell faces a string of class-action suits, claiming the company misled investors for years over its reserves levels.

http://www.nytimes.com/2004/07/21/business/21shell.html