By Nicolas Torres -
August 19, 2016
Image courtesy of SandRidge Energy. SandRidge Energy confirmed on Monday that the U.S. Securities Exchange Commission has filed a $1.2 million claim in its bankruptcy case.
The claim is related to SandRidge’s firing of an employee who alleged that the company failed to accurately report oil and gas reserve figures.
In its second quarter filing, SandRidge said it was served with two subpoenas seeking documents related to the allegations.
SandRidge said it received a letter from an attorney representing an unnamed former employee who alleges that he was terminated because he “objected to the levels of oil and gas reserves disclosed by the company in its public filings.”
SandRidge said in the filing that over 85 percent of its reserves were calculated by an independent petroleum engineering firm.
The audit committee of the company’s board of directors has retained an independent law firm to review the allegations and the circumstances of the former employee’s termination.
SandRidge said it reported the allegations to the SEC and was served with two subpoenas from the agency related to the matter.
SandRidge’s Counsel for the Audit Committee is responding to both of the subpoenas.
SandRidge said it sent “corrective letters to certain current and former employees who had entered into agreements containing language that may have been inconsistent with SEC rules prohibiting a company from impeding an individual from communicating directly with the SEC about possible securities law violations.”
The company added that, on June 16, the SEC filed a $1.2 million proof of claim in its Chapter 11 case as a result of the agency’s inquiry into the company’s employment-related agreements.
The Oklahoma-based company is cooperating with the inquiry.
“Counsel for the company is in discussions with the SEC in an effort to resolve the company’s liability regarding these inquiries,” SandRidge said.
SandRidge Energy filed for Chapter 11 bankruptcy protection in May.
The company’s total debt stood at $3.6 billion as of December 31.
SandRidge told Tulsa World on Monday that it could emerge from bankruptcy sometime in September if its plan is approved by lenders and the court.
Earlier this year, SandRidge confirmed that the U.S. Department of Justice had dropped an investigation into the company’s lease bidding practices.
The investigation had been looking into purchases or leases of land, oil or natural gas rights dating back to 2012 and “prior years.”
The probe was dropped just about a month after Chesapeake Energy founder Aubrey McClendon was indicted by a federal grand jury for allegedly conspiring to rig oil and natural gas leasing bids in northwest Oklahoma.
McClendon, 56, died in a car accident barely a day after the indictment was made public.