Russian Regulator Says Some Oil, Mining Companies Overstating Reserves

Some foreign oil, gas and mining companies operating in Russia have been making money by overstating their reserves to boost their share price, the deputy head of Russia’s environmental watchdog agency said Thursday.

Oleg Mitvol called upon the economic security department of the Federal Security Service – the KGB’s main successor – to review certain foreign companies that have allegedly exaggerated their reserves and sold shares on foreign exchanges between 2003 and 2007.


The announcement comes one day after Mitvol made similar remarks about a London-listed oil company that wiped $200 million off its value.

“We are dealing with artificially puffed up shell-firms…that bring in profits on western stock exchanges using financial instruments without investing sufficient funds in the real sector of the Russian economy,” Mitvol said in a statement posted on the Web site of the Natural Resources Ministry.

Dow Jones Newswires