Thursday, August 18, 2011

Goodrich's Haynesville Data Subpoenaed

Goodrich Petroleum announced today that it has received subpoenas from the Securities and Exchange Commission and the State of New York Attorney General's office "requesting information relating to its Haynesville Shale gas wells and reserves."  The company thinks the subpoenas are a result of the front page articles in the New York Times a couple of months ago, articles that I think are borderline yellow journalism.  Not sure what will come of this.  If Goodrich is on the receiving end of these subpoenas, expect similar announcements from other companies.

Interestingly, a couple of weeks ago the Times' Public Editor Arthur Brisbane took the authors and editors of the scandalous natural gas articles to task for a second time in his weekly column in the Sunday Times (July 31, 2011).  In an article entitled, "Why Redacting E-Mails Is a Bad Idea," he schooled us on the "classic problems associated with anonymous sourcing."

Interestingly, after reviewing the un-redacted versions of the emails, he discovered that one of the secret sources from inside the EIA was actually an intern (as I almost jokingly suggested last month) who eventually worked his way into an entry level position after two years.  What an expert on shale gas!  There were other sources for the data, but you know what they say about the weakest link of the chain.

Bottom line:  the New York Times had no business printing this series as it did.  The good news is that the paper's own Public Editor burned two of his weekly columns agreeing.  The bad news is that his strong criticism is not a retraction, nor does it reverse the damage done by the front page articles.  What is unknown is whether there is any truth to Goodrich's claim that the subpoenas are motivated by the articles in the Times.  If so, expect more collateral damage in coming weeks.

No comments: