The Stock Market Reaction to the Reserve Quantity Disclosures of U.S. Oil and Gas Producers

Abstract

Abstract. The purpose of this study is to examine the information content of the components of the annual change in the quantity of proved reserves reported by U.S oil and gas (O&G) producers. In particular, it investigates the contemporaneous association between the unexpected portions of discoveries, production, net purchases, and revisions of prior quantity estimates and unexpected security returns during the release week of the 1984 to 1988 annual reports or forms 10‐K of these firms. The empirical results suggest that (1) disaggregating the net change in the quantity of proved reserves into its components conveys additional information beyond that contained in the net change in total pr..