{"id":56695,"date":"2021-02-09T09:42:03","date_gmt":"2021-02-09T14:42:03","guid":{"rendered":"https:\/\/olduvai.ca\/?p=56695"},"modified":"2021-02-09T10:33:59","modified_gmt":"2021-02-09T15:33:59","slug":"exclusive-whistleblower-accuses-exxon-of-fraudulent-behavior-for-overvaluing-fracking-assets-for-years","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=56695","title":{"rendered":"Exclusive: Whistleblower Accuses Exxon of ‘Fraudulent’ Behavior for Overvaluing Fracking Assets For Years"},"content":{"rendered":"

Exclusive: Whistleblower Accuses Exxon of ‘Fraudulent’ Behavior for Overvaluing Fracking Assets For Years<\/a><\/h3>\n
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\"ExxonMobil\"<\/div>\n<\/div>\n<\/div>\n
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ExxonMobil announced<\/a>\u00a0a $19.3 billion write-down on Tuesday, a big hit to a company reeling from depressed oil and gas prices and a rapidly changing global energy\u00a0market.<\/div>\n<\/div>\n<\/div>\n
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The write-down reduces the value of the assets on Exxon\u2019s books. The announcement comes as part of the company\u2019s fourth quarter earnings for\u00a02020.<\/p>\n

The fossil fuel giant, however, may be understating the financial damage to its assets, according to a former ExxonMobil employee turned whistleblower, Franklin Bennett. The oil major has overvalued its assets for years, according to Bennett and a team of advisors, a practice he describes as \u201cfraudulent and defiant behavior\u201d in a January 31 supplement to a whistleblower complaint he filed with the\u00a0U.S.<\/span>\u00a0Securities and Exchange Commission (SEC<\/span>).<\/p>\n

Bennett and his team argue that instead, the company has been overvaluing its\u00a0U.S.<\/span>\u00a0oil and gas assets by as much as $56 billion, as of year-end\u00a02019.<\/p>\n

At the root of the\u00a0SEC<\/span>\u00a0complaint is ExxonMobil\u2019s 2010 purchase of shale fracking company\u00a0XTO<\/span>\u00a0Energy, which it acquired at the height of the natural gas boom for $46 billion. In the months and years following the acquisition, natural gas prices collapsed, and never returned to previous heights, rendering much of\u00a0XTO<\/span>\u2019s assets\u00a0uneconomic to produce<\/a>.<\/p>\n

Until now, ExxonMobil largely refused to take a meaningful write-down on those assets, despite several downturns in oil and gas market conditions. In particular, a deep natural gas price slide in 2015\u20132016, and another in 2019,\u00a0hollowed out<\/a>\u00a0the valuation of many high-cost shale gas assets. Through it all, Exxon never took a significant write-down, which Bennett and his team argue is\u00a0illegal.<\/p>\n

In accounting terms, Exxon essentially told regulators that they could still get full value from the assets that they paid for in 2010, despite the deterioration in the natural gas market, claims the\u00a0SEC<\/span>\u00a0complaint.<\/p>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/article>\n","protected":false},"excerpt":{"rendered":"

Exclusive: Whistleblower Accuses Exxon of ‘Fraudulent’ Behavior for Overvaluing Fracking Assets For Years ExxonMobil announced\u00a0a $19.3 billion write-down on Tuesday, a big hit to a company reeling from depressed oil and gas prices and a rapidly changing global energy\u00a0market. The write-down reduces the value of the assets on Exxon\u2019s books. The announcement comes as part […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[5317,4390,331,554,6010],"class_list":["post-56695","post","type-post","status-publish","format-standard","hentry","category-economics","tag-desmog-blog","tag-exxon","tag-fracking","tag-natural-gas","tag-nick-cunningham"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56695","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=56695"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56695\/revisions"}],"predecessor-version":[{"id":56701,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56695\/revisions\/56701"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=56695"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=56695"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=56695"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}