SEC changes oil, gas reporting rules

San Francisco Business Times

Wednesday, December 31, 2008, 6:37am PST

The Securities and Exchange Commission has approved changes that will allow oil and gas companies to disclose what the SEC calls “probable and possible reserves” to investors.

The SEC attributes the change, which could have a significant impact on the disclosures allowed by oil and gas companies around the country, to the availability of updated technologies that make it easier to prove the possibility of reserves before full discovery.

In a statement about the changes, the SEC says, “The new disclosure requirements approved by the commission include provisions that permit the use of new technologies to determine proved reserves if those technologies have been demonstrated empirically to lead to reliable conclusions about reserve volumes. The new requirements also will allow companies to disclose their probable and possible reserves to investors. Currently, the commission’s rules limit disclosure to only proved reserves.”

SEC Chairman Christopher Cox added, “These updates to the SEC rules will help ensure more meaningful and comprehensive disclosure of information that, even though it does not appear on a company’s balance sheet, is of significance to investors in making informed investment decisions.”