Bermuda-based Nabors Industries Ltd., one of the world?s major drillers of oil and natural gas, said yesterday it would conduct a further review of its stock-options practices after a news report raised questions about grants to chief executive officer Eugene Isenberg.

Mr. Isenberg, 77, became one of the highest-paid corporate executives in history, receiving more than $450 million over 19 years, the Wall Street Journal reported yesterday. The compensation included more than 25 million options, some of which were reissued at lower exercise prices after a drop in the company?s share price made them worthless, the newspaper said.

And Standard & Poor?s ExecuComp estimate that the Mr. Isenberg?s overall stock-option gains, both realised and not yet cashed in, came to $685 million at the end of last year.

A Nabors spokesman told the Journal that an internal review had found ?no irregularities in its grant practices?. And he added that Nabors believed Mr. Isenberg was appropriately compensated, as he had lifted a company that was in the bankruptcy courts to one that had a market valuation of $9 billion today.

Stock options ? granting the right to buy stock in the future at today?s price ? were once seen as an effective incentive to company bosses to improve corporate performance. But stock options were at the heart of a huge corporate fraud scandal this year as numerous examples of executives ?backdating? their options - claiming that they had been issued at an earlier date and at a more favourable price - were unearthed.

But the Journal raised questions about the dating of Mr. Isenberg?s stock options, noting that a number came on days that the stock hit its lowest close for the month or quarter.

The paper reported: ?In all, of 11 new option grants to Mr. Isenberg between 1991 and 2002, two were dated at quarterly lows in the Nabors stock price and five more at monthly lows. The odds against such a fortunate pattern occurring by chance are long.?

More than 190 companies have disclosed investigations into the backdating of options grants that inflate returns to those who hold them. The probes have prompted at least $8 billion in restatements, revisions and charges to reflect costs that should have been reported.

Nabors issued a statement yesterday saying an internal review earlier this year prompted by the practices of other companies ?did not suggest that there was reason to question the propriety of the company?s own stock-option practices dating back to 1998?.

The further review was initiated ?as a result of issues raised in the Wall Street Journal article,? the company said. The Journal said it reviewed option grants dating as far back as 1991.

Nabors, which is based in Hamilton and run from offices in Houston, won?t comment on the investigation or news article beyond its written statement, spokesman Dennis Smith said yesterday.

Mr. Isenberg took over at the helm of Nabor Industries in 1987. Nabors grew into one of the world?s largest contract oil and gas drillers, with yearly revenue of $3.6 billion, whose stock has risen at 21.7 percent per year.

The Journal highlighted how Mr. Isenberg?s contract as the company emerged from bankruptcy, entitled him to an annual bonus equalling a percentage of the company?s cash flow above a threshold.

Instead of accepting all his bonuses, Mr. Isenberg in many years declined part of them in favour of stock options. By Nabors? reckoning, his option grants were worth tens of millions of dollars in some years. Yet the CEO still received substantial cash bonuses, of as much as $3 million in a year, and sometimes was given additional options, the Journal reported.

Stock options were designed to benefit the recipient only in the case of a share price rise ? but even when there was a fall, Mr. Isenberg did not lose out, according to the Journal. For example, in 1998, amid an industry slump, Nabors? stock sank sharply. Some of Mr. Isenberg?s options were ?under water?, but the board repriced them. In exchange for giving up a fourth of his old options, Mr. Isenberg got new ones carrying a more favourable exercise price.

Mr. Isenberg was also the beneficiary of a ?reload? plan ? the replacement of stock options after had exercised them.

The Journal also showed how the Bermuda company?s practices enabled Mr. Isenberg to cash in repeatedly on a single stock option grant.

The paper reported: ?Mr. Isenberg received a grant of 1.8 million options dated September 23, 1991. He exercised them in 1996 and 1997, pocketing about $24 million in profits.

?Normally, that would have been the end of these options. But Nabors reloaded Mr. Isenberg, replacing his exercised options with a similar number ? which had 10 more years to run.

?Then in 1998, amid the stock downturn, Nabors repriced the reload options.

?Mr. Isenberg cashed in most of them in 2000 and gave the rest to a family member in 2002. His total profit from a single grant ? reloaded, extended and repriced: about $54 million, not including the gift.?