The $4.2-billion oil and gas company controls roughly five million acres in Western Canada.LARRY MACDOUGAL/The Canadian Press
More than half a dozen U.S. law firms have launched efforts to attract Penn West Petroleum Ltd. shareholders to class-action suits in response to the Calgary oil producer's revelation that it discovered accounting irregularities dating back more than two years.
Penn West's announcement late Tuesday that it discovered at least $381-million misclassified on its books – forcing it to delay financial results and possibly putting it afoul of some of its debt terms – prompted several tort specialists to launch their own investigations into possible breaches of U.S. securities regulations.
"We've been talking to a lot of shareholders to essentially assess the potential here," said Peter Andrews of Wilmington, Del.-based Andrews & Springer LLC.
"There's a lot of people pretty upset about what has happened on this restatement issue, and the more I look at it the more troubled I get. If they reclassify operating expenditures as [capital expenditures], what else have they done?"
Mr. Andrews said about 30 investors, including a few Canadians, had contacted his firm since it announced its aim on Wednesday to proceed with an action.
Shares in Penn West fell 2 per cent on Thursday, adding to a 14-per-cent skid a day earlier as investors fretted about the impact of restating financial results going back to 2012, and the company's further investigation into its books as far back as 2010.
Executives, including chairman Rick George and chief executive David Roberts, have not commented publicly since the company disclosed its accounting problems.
Jeffrey Jones