Shell Asks SEC to Allow Inclusion of Canadian Sands in Reserves

(Bloomberg) — Royal Dutch Shell Plc, Europe’s largest oil company by market value, urged U.S. regulators to ease rules on how petroleum reserves are counted to allow the inclusion of Canada’s oil sands.

“The current exclusion of reserves not reported for crude oil, natural gas, and natural gas liquids that may be recovered from tar sands, oil shale, and other in-place hydrocarbons should be removed,” The Hague-based Shell said in a letter to the U.S. Securities and Exchange Commission dated Feb. 19.


The SEC is considering rule changes that would permit companies to count reserves that their engineers haven’t yet figured out how to tap, as well as oil from Canada’s tar sands, now classified as mining operations. Easing reporting rules may spur acquisitions by giving suitors more details about a target company’s growth potential.

Shell four years ago said 41 percent of the reserves on its books had been improperly recorded. The issue triggered regulatory probes in the U.S. and U.K., $151.5 million in fines, shareholder lawsuits and the ouster of three senior executives. Shell wants to revive production growth through projects such as Canadian oil-sands and a gas-to-liquids venture in Qatar.

Bloomberg