According to company spokeswoman Kim Wallace, “In February, El Paso, the nation’s largest natural gas pipeline company, announced a reduction in proven reserves, which would require a US$1 billion writedown of those reserves’ value. The writedown is expected to be more than initially reported.”

“[I can] not provide details on how many employees the review cited or their employment status with the company,” said Wallace.

“[We are] cooperating with the Securities and Exchange Commission’s informal inquiry into the reserves reduction and the U.S. Attorney's office,” added Wallace.

This announcement comes on the back on an independent review conducted by Haynes and Boone LLP which encountered estimates El Paso now admits certain employees “knew or should have known were incorrect”.

The review also noted El Paso employees used “aggressive and, at times, unsupported methods to book proved reserves”. El Paso’s current management was absolved of any wrongdoing.

“This process is an important milestone for all stakeholders as we take the necessary steps to ensure the integrity of the company’s reserve reporting process,” said El Paso chairman Ronald L. Kuehn Jr.

Haynes and Boone had been taken on by the El Paso Board to recommend improvements in internal control and to determine any possible misconduct. The company will now restate its financial reports and has advised its investors not to reply on reports filed between 1999 to now.