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El Paso delays quarterly earnings statement, likely to restate figures

By OGJ editors
HOUSTON, Mar. 11 -- El Paso Corp., Houston, Wednesday announced the delay of its fourth-quarter 2003 earnings statement, pending a review of its negative reserves revision and also pending a decision on whether past financial statements will need to be restated.

The fourth-quarter results were to have been released Thursday.

In February, El Paso reduced its estimated proved oil and natural gas reserves by 1.8 tcfe, or 41%, leaving the company with 2.64 tcfe as of Dec. 31, 2003 (OGJ Online, Feb. 18, 2004). The total amount of the reserves revision will not change, El Paso said in its latest news release.

"The company believes that it is likely that a restatement of the financial statements for El Paso Corp., El Paso CGP Co., and El Paso Production Holding Co. will be required. Consequently, investors should not rely on previously filed reports for these registrants until further notice from the company," the news release said.

The completion of El Paso's internal review and review by an audit committee also will delay the annual report, or Form 10-K filings, to the US Securities and Exchange Commission. El Paso said it expects to receive waivers from the lenders participating in its revolving credit facility and other bank facilities regarding a restatement or delay in its annual report.

The New York-based Standard & Poor's Ratings Services said it did not adjust El Paso's credit rating based upon the delay in fourth-quarter earnings and annual report to the SEC. S&P's issued a rating downgrade at the time of the reserves revision disclosure.

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