Shell Cuts Reserves Estimates, Shares Fall (20% Reserve Downgrade)

[hatrack]

AMSTERDAM/LONDON (Reuters) - "Royal Dutch/Shell Group cut its estimated proven oil and gas reserves by 20 percent on Friday, triggering a share price slide and sharp investor criticism of the Anglo-Dutch firm's management.

Most top western oil companies are struggling to find new viable fields of sufficient size to replace maturing assets -- seen as crucial to future growth in earnings.

Yet in recent years Shell, one of the world's top three energy firms, has been seen as the laggard, both in terms of reserve replacement from its own finds and through acquisitions.

EDIT

Shell came late to the acquisitions spree that saw rivals BP and ExxonMobil make major deals to shore up reserves. Friday's news highlights over-optimism in its home-grown key areas, including Australia's Gorgon gas field, onshore activities in Nigeria, and other unspecified areas in the eastern hemisphere. Shell recategorized 3.9 billion barrels of "proven" oil and gas reserves -- enough to supply world oil demand for 50 days -- as either "unproven" or having "scope for recovery."

EDIT

[htuttle]

1. Everyone lies about oil reserves...

As Dr. Colin Campbell points out, almost all the gains in oil reserves over the last 20 years are the result of accounting 'restatements' instead of actual new discoveries.

OPEC inflates their reserve figures to hold onto the power and clout they have, and prevent more movement away from oil and toward alternative fuels.

The US inflates their reserve figures to prevent OPEC from feeling too powerful about their hold on oil.

The oil companies inflates their reserve figures to keep their stockholders happy.

[mhr]

2. Peak Oil - Follow These Links To Learn More

Websites of interest include:

http://www.lifeaftertheoilcrash.net/Home.html
http://www.oilcrash.com/
http://www.wolfatthedoor.org.uk/
http://www.asponews.org
http://www.gulland.ca/depletion/depletion.htm
http://www.dieoff.org/
http://www.oilanalytics.org/
http://www.greatchange.org/
http://www.oilcrisis.com/
http://www.after-oil.co.uk/
http://www.hubbertpeak.com/
http://hubbert.mines.edu
http://www.museletter.com/archive/cia-oil.html

Energy Resources
http://groups.yahoo.com/group/energyresources/

Alas Babylon
http://groups.yahoo.com/group/AlasBabylon/

Running on Empty
http://groups.yahoo.com/group/RunningOnEmpty2/

[el_gato]

3. it's also funny because

increasing resesrves through acqusitions is a con game
since there is no real addition to proveable reserves