GETTING AT THE TRUTH ABOUT NAT GAS RESERVES

New York Subpoenas Energy Companies Over Claims About Gas Wells
Ian Urbina, August 18, 2011 (NY Times)

"New York State’s attorney general has sent subpoenas to three large energy companies as part of a broad investigation into whether they have accurately described to investors the prospects for their natural gas wells…

"The subpoenas focus on how the companies took advantage of federal rules, adopted in late 2008, that govern the way they report their oil and gas reserves to investors."

click to enlarge

"Investigators have requested documents relating to the formulas that companies use to predict how much gas their wells are likely to produce in the coming decades…[and] documents related to the assumptions that companies have made about drilling costs in their estimates of the wells’ long-term profitability…

"Subpoenas were sent to the three companies — Range Resources, Cabot Oil and Gas, and Goodrich Petroleum — …who have direct knowledge of the investigation…[and] to a fourth company, Chesapeake Energy…The four companies…are heavily involved in natural gas drilling and because New York State has over $45 million of its pension money invested with them. If a company improperly reported to investors how its wells were likely to perform or failed to disclose the true costs of drilling, there could be repercussions for the state’s financial portfolio…"