New York Subpoenas Energy Companies Over Claims About Gas Wells

Source: NY Times

New York State’s attorney general has sent subpoenas to three large energy companies as part of a broad investigation into whether they have accurately described to investors the prospects for their natural gas wells, according to several sources familiar with the inquiry.

The subpoenas focus on how the companies took advantage of federal rules, adopted in late 2008, that govern the way they report their oil and gas reserves to investors.

Investigators have requested documents relating to the formulas that companies use to predict how much gas their wells are likely to produce in the coming decades. The subpoenas, which were sent on Aug. 8, also request documents related to the assumptions that companies have made about drilling costs in their estimates of the wells’ long-term profitability.

The investigation will be watched closely in the industry because the attorney general, Eric T. Schneiderman, is using a New York law called the Martin Act that gives him broad powers over businesses and allows him to obtain and publicly disclose an unusual amount of information.

Read more: http://www.nytimes.com/2011/08/19/us/19gas.html?hp

Is flammable water now desirable selling point? How 'bout toxic sludge in your well?

It's a start.