Exxon SEC probe highlights concerns over shale reserves

Bloomberg

The Securities and Exchange Commission (SEC) has been largely silent on the financial wreckage of the US shale industry in recent years, but that may be about to change.
The top US financial regulator’s reported investigation into how Exxon Mobil Corp values shale assets follows years of concerns about the industry’s rosy projections, which have left hundreds of billions of dollars of investor losses and writedowns.
Exxon, the West’s biggest oil company, is accused in a whistleblower complaint of inflating the value of a key asset in the Permian Basin and making drilling plans that were too optimistic, the Wall Street Journal reported.
“The SEC is cracking down on the overvaluation of these type of hard-to-value assets,” said Arthur Jakoby, a former SEC official and now a partner at Herrick, Feinstein LLP in New York, and who’s not involved in the case.