Financial Daily from THE HINDU group of publications
Thursday, Jan 12, 2006


News
Features
Stocks
Shipping
Archives
Google

Group Sites

Industry & Economy - Petroleum


DG Hydrocarbons set to finalise disclosure norms for new oil and gas finds

Richa Mishra

New Delhi , Jan. 11

EXPLORATION and production (E&P) companies may have to exercise caution before making any announcements about new oil and gas finds by them. The Directorate-General of Hydrocarbons (DGH) is in the process of finalising the norms that would put in place a system to alert investors and stock exchanges of any premature declaration or disclosure of an oil and gas discovery made by such companies.

Once the norms are in place, the Securities and Exchange Board of India and the DGH propose to have coordinating officers in their respective organisations, who would monitor the implementation of these guidelines.

To check share price `rig': Official sources said the DGH had recently made a presentation to the capital market regulator SEBI on the issue. At the meeting it was agreed that the DGH would be the final authority on such announcements and would put in place a mechanism that would check the validity of any oil and gas strike. This would ensure that announcements of new findings were not misused by companies to rig their share prices, sources told Business Line.

New classifications: Asked about the proposals, sources indicated that the discoveries could not be linked to reserves till a competent authority, in this casethe DGH, certifies it. The norms are likely to classify announcement of reserves into various categories. Petroleum discoveries are very difficult to estimate as even a promising reserve could turn out to be unrecoverable or too expensive to recover. Accordingly, the finds would be classified as proven, probable and possible, which have significantly different implications for the explorer and the country.

The new guidelines are to direct companies to make declarations of significant discovery only after detailed technical appraisal of the discovery with prior Government nod.

Further, the norms are likely to suggest that the companies could announce the new discoveries with a statement that `commerciality of the find is yet to be proven', sources said. These norms would help in altering the stock exchanges, whenever there is a premature disclosure or a non-disclosure of development that merits disclosure, they added.

The move follows concerns expressed by SEBI over premature announcements of the in-place oil and gas reserves in new fields by the companies in this sector, which had an impact on the stock market and misled investors.

DGH, which already has set some standards in place, is now working with SEBI to relate this with the capital market, sources added.

More Stories on : Petroleum

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page



Stories in this Section
Fresh system to lift mercury in North


Left seeks restoration of 9.5% interest rate on EPF
Relocating tribals from sanctuary
Bauxite mining plan infuriates tribal belt in Vizag
Work on foundry parks in Coimbatore to begin soon
ONGC submits report on discoveries
Delay in dredging at Kochi worries Petronet LNG
DG Hydrocarbons set to finalise disclosure norms for new oil and gas finds
Electricity Tribunal allows PowerGrid to execute M.P. project at higher cost — Sets aside CERC order on `cost ceiling'
Productive year for VSP
Textile sector needs more reforms, investment — IMF study scenarios give little cause for cheer
Dish TV offers no-subscription package
Corporates must shed feudal mindset, says Ranbaxy chief
Jamnalal Bajaj meet in Mumbai
CSI student chapter meet in Thiruvananthapuram
Helmet to come with bike in AP
Parsvnath to adopt eco management system
TN govt to build land bank to meet demand from industries
Workshop on construction engg at Kochi
Scramjet: ISRO makes major breakthrough
Chidambaram promises to simplify fringe benefit tax — `Non-navratna disinvestment on track'
Bids for MUL stake: Banks, FIs take cautious approach
Concern over insurance scheme for BPL families in Kerala
All BPL families to get rice at Rs 3 a kg in Kerala
Auto show set for big launch today — Rs 440-cr business deals likely to be accomplished
Call for sustainable corporate growth
Royal Sundaram takes Rs 9-cr hit due to floods
Reliance Capital, TV 18 team up to fund Yatra


The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2006, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line