In this stunning announcement, Royal Dutch/Shell today downgraded 250 million barrels in reserves to less certain reserve categories and decided not to book 220 million barrels that it had earlier classified as reserves. Although small in comparison to Royal Dutch/Shell’s earlier writedown, the timing of this latest reserve writedown is certain to increase scrutiny of the company’s management practices.
As noted here and here, Royal Dutch/Shell is already the subject of Justice Department and SEC investigations regarding its earlier reserve writedown.