Houston American Corp. (AMEX: HUSA) says the Securities and Exchange Commission’s investigation into the company appears to be focused on disclosures about the potential of its CPO-4 prospect in Colombia in late 2009 and early 2010.
Houston American, which was the subject of a Sharesleuth story in the summer of 2010, provided additional details of the investigation in a new SEC filing covering the sale of $10 million in stock.
Houston American said in the filing that it had provided the SEC with information supporting its disclosures about the resource potential of the CPO-4 prospect. It said it would be discussing that material with the SEC this month.
Houston American’s stock has fallen from a high of $20.36 a share in April 2010 to its current price of 63 cents. The first two wells that the company and its partners drilled on the CPO-4 prospect produced no oil.
The third is more than half way to its targeted depth.
Houston American said in an investor presentation and a related SEC filing in November 2009 that the CPO-4 prospect was estimated to hold anywhere from 1 billion barrels to 4 billion barrels of “recoverable reserves.’’
As Sharesleuth noted in our original story, the higher figure exceeded the official proved and probable reserves for all of Colombia.
Houston American said in its latest filing that the SEC began an informal inquiry into the company in October 2010, which turned into a formal investigation on March 1, 2011. It said it received a subpoena from the agency in February of this year.
Houston American publicly disclosed the investigation in April, saying it had received subpoenas calling for the testimony of its chief executive officer, John F. Terrwilliger; its chief financial officer, John J. Jacobs, and for the delivery of certain documents.
