New York Attorney General Eric Schneiderman is investigating accounting procedures at Exxon Mobil Corp. (XOM
), according to published reports. The core of the inquiry centers on why Exxon hasn’t written down the value of its oil fields, as nearly all of its competitors have, amid falling prices for oil.
Exxon told reporters that its accounting meets all regulatory standards.
The accounting investigation, first reported
by The Wall Street Journal, is a spin-off of sorts of an earlier investigation by New York, Massachusetts and other states into whether Exxon misled shareholders by failing to warn them of the portfolio risks associated with global warming. Schneiderman told the N.Y. Times in August that he was also questioning what effect regulations on carbon emissions would have on Exxon’s valuation.
Exxon, the world’s biggest oil explorer by market value, is the only major producer to have not written down assets as oil prices have plummeted. Exxon’s competitors have taken write-offs of some $200 billion, according to the Journal, citing data from consultancy Rystad Energy.
The initial investigation by Schneiderman, a Democrat, generated questions from Congressional Republicans. In July, the House of Representatives Committee on Science, Space and Technology subpoenaed Schneiderman and Massachusetts A.G. Maura Healey, claiming the Exxon investigations were designed to quash the free speech of scientists who dispute climate change. Schneiderman and Healey have refused to comply with the subpoena.
Analysts had no immediate reaction to the news that Schneiderman had expanded the scope of his investigation.
The oil company has 25 percent positive ratings over the last 90 days, with a median price target of $100
. Shares of Exxon fell 1.05, or 1.23 percent, to 84.03.