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// Third executive sacked in Shell reserves scandal

A THIRD senior executive at Shell has been sacked in the scandal over inflated oil reserves which has enveloped the company since it emerged in January.

Finance chief Judy Boynton was sacked yesterday after an independent report concluded that executives at Royal Dutch/Shell knowingly hid an oil and gas reserves shortfall for years and feared the game was up as far back as 2002.

And in a bid to restore investor faith in the business, the oil giant has lopped a further 300m barrels worth of oil from the reserve figure calculated for 2002, bringing the total reduction in reserves booked for that year to 4.35bn barrels of oil equivalent (boe). The latest cut means Shell has reduced by more than 22pc the reserves originally booked for that year. It also cut a further 200m boe from 2003 bookings for a total 2003 reserves cut of 500m boe. The eagerly-awaited report, commissioned by non-executive directors in the aftermath of the reserves debacle and compiled by US law firm Davis, Polk and Wardwell, unearthed memos in which one executive talked of his "lying" and about how the firm had "fooled" the market. It also showed that internal audits on booking reserves - a crucial measure of value in the oil industry - were undertaken by a single former Shell employee working part-time. Shell's crisis came to a head on January 9 this year, when it announced that it had overbooked proved reserves by 20pc. The debacle has prompted investigations by investment regulators in the US and Europe. Pat Boyle © Irish Independent