Shell pays out over reserves affair

Royal Dutch Shell is to pay European and other non-US investors more than £178m to settle claims over the scandal surrounding…

Royal Dutch Shell is to pay European and other non-US investors more than £178m to settle claims over the scandal surrounding the overstatement of its oil and gas reserves.

The company shocked shareholders in 2004 by slashing its proven reserves figures by some 20 per cent .

The affair cost three of its senior executives their jobs, sparked a probe by US regulators and sent the firm's shares plunging.

Shell said it had agreed to pay out some £178.3m, plus administrative costs, "without admitting any wrongdoing".

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It has always insisted that the overstatement was a genuine error and not a deliberate exaggeration.

It has said it plans to offer the same deal to US investors in proportion to their shareholding in the company.

The agreement is dependent on the Amsterdam Court of Appeals ruling that the settlement will be binding on all shareholders.

Non-US investors include ABP and PGGM, as well as organisations representing individual shareholders.

Royal Dutch Shell is the West's second-largest oil company by market value.

It is worth some £108bn at its current share price.