Shell review shows execs aimed to fool market

[UpInArms]

http://www.forbes.com/business/newswire/2004/04/19/rtr1336011.html

LONDON, April 19 (Reuters) - Royal Dutch/Shell executives knowingly hid an oil and gas reserves shortfall from investors for years and feared the game was up as long ago as 2002, an independent review by lawyers revealed on Monday.

Unearthing memos from the past few years, in which executives talked of "lying" and "fooling the market", the report also showed that internal audits on booking reserves -- a crucial measure of value in the oil industry -- were undertaken by a single former Shell employee who worked on a part-time basis.

Shell struck a crisis at the start of this year, announcing that it had overbooked proved reserves by 20 percent.

<snip>

In November 2003 he told then Chairman of Managing Directors Phil Watts he was "sick and tired about lying about the extent of our reserves issues and the downward revisions that need to be done because of far too aggressive/optimistic bookings."

Yet a month later Van de Vijver told staff to destroy a document outlining how 2.3 billion barrels of reserves were "non compliant" with regulatory guidelines because it was "dynamite".

...more...

[emad]

1. US wants full Shell report held back

From London Evening Standard:

THE prospect of criminal charges resulting from the exhaustive investigation at Shell grew today, as it emerged that US authorities have asked the group not to release the full internal report.

Shell presented amazing email conversations between disgraced former chairman Sir Philip Watts and his exploration chief Walter van de Vijver with the probe's main findings today.

But it said US government authorities had requested it 'not release the full text of the report' in order to give them time to go through evidence found by the inquiry.

The US Justice Department opened its own probe shortly after the US Securities and Exchange Commission kick-started its own formal proceedings into the reserves debacle.

<snip>
More:
http://www.thisislondon.co.uk/news/business/articles/timid77115?source=

[Barrett808]

2. Wonder how much Iraqi oil they were expecting to score n/t

[nolabels]

6. Premature expectations seems would be just up Shells alley

http://news.bbc.co.uk/2/hi/business/3451341.stm

Shell cut reserves 'over Nigeria'

Shell's chairman is due to explain reasons for the cut
Nigeria says it was a reassessment of its oil fields that led Shell to cut proven reserves by 20% last month, the Financial Times reported.

The country's officials maintain Nigeria accounted for a third of the 3.9bn barrel cut, the newspaper says.

The company reportedly expects to reinstate at least half of the reserves over the next five years.

Shell's chairman is set to explain the reasons for the surprise cut to shareholders on Thursday.

Row over funding

The company had allegedly prematurely booked some of Nigeria's oil and gas fields as ready for development between 1996 and 2002.
(snip)

[Robbien]

3. Greenspan wants companies to work harder to restore trust

So companies put out a media campaign saying "see we are honest because we publically throw out our corrupt officers." I wonder if any one is dumb enough to fall for that. Instead of stopping the corruption, companies are running a PR campaign.

And executive pay keeps rising.

[UpInArms]

4. posting the following just for fun

http://www.csmonitor.com/2004/0419/p16s01-wmgn.html

excerpt:

Those determined to invest for change in the Middle East will find a highly cautious approach among the multinational corporations that present themselves as beacons of social responsibility in the region. Among the leaders of the corporate social-responsibility movement are the Dubai conference's lead sponsors: Royal Dutch/Shell Companies, British American Tobacco, and McDonald's Corp. In McDonald's case, "responsibility" to date has meant being sensitive to local customs, sharing ownership with local franchisees, and donating to health clinics and hospitals in countries where the company operates restaurants.

[nolabels]

5. Secret Dick has his fingerprints all over this

A couple of hokey oil dudes with their hands in both pieces of the pie either both are way more dumb then any could imagine, or they lying and hiding something Is it time for more duck hunting jokes yet?

http://www.smh.com.au/articles/2004/04/14/1081838796111.html
Shell raised Oman oil reserves as output fell-NYT
Reuters, 04.08.04, 4:04 AM ET

NEW YORK, April 8 (Reuters) - Royal/Dutch Shell's <RD.AS><SHEL.L> oil output in Oman has been falling for several years, disproving company reports of improving production in the country, the New York Times reported on Thursday.

The Times said internal documents at the Anglo-Dutch group had suggested that proven oil reserve figures for Oman were raised in 2000 and resulted in a 40 percent overstatement by mistake.

Yet Oman's largest field, Yibal, had started producing less in 1997, it cited the internal documents and technical papers as saying.

Shell's former chairman Sir Philip Watts had said publicly in 2000 that improvements in drilling were helping the firm "to extract more from such mature fields," the Times said.
(snip)

http://www.forbes.com/newswire/2004/01/09/rtr1204427.html