Securities Laws Issues: Forward-looking Statements
September 2002 By David M. Abbott Jr.
The last issue of the DPA Correlator contained an article addressing the fact that fractional undivided interests in oil and gas or other mineral rights are securities by definition under federal and most state laws. Since many petroleum geologists either work for publicly-held companies or deal in the promotion and/or operation of ventures involving fractional undivided interests in oil and gas properties (fractional overriding royalties, working interests of varying types, etc.), the professional activities of many petroleum geologist fall within the purview of the securities laws regardless of whether this fact is recognized. This month, I wish to address a fairly new federal securities law issue that affects our professional opinions regarding prospects, reserve estimates, and projections of project economics, namely forward-looking statements.