Exxon Setback as Shale-Gas Wells Fail in Poland
Exxon, the worlds largest energy company, yesterday said two exploratory wells drilled in a Polish shale formation at the end of 2011 werent commercially viable. The gas discovered in the wells, Exxons first in Poland, failed to flow in sufficient quantities to justify bringing them into production, David Rosenthal, vice president for investor relations, said during a conference call with analysts and investors.
International energy prospectors, including Chevron Corp. (CVX) and Talisman Energy Inc. (TLM), are probing Polands vast shale deposits to see if intensive drilling techniques that revolutionized U.S. gas production can unleash reserves big enough to supply Polish demand for more than three centuries. Exxons setbacks suggest Polands shale poses unique challenges that may increase costs and delay output, said Gianna Bern, founder of Brookshire Advisory & Research in Chicago.
Shale exploration is a very high-cost and high-risk business and the Polish shale market is still in its infancy, Bern, who advises major oil companies on risk management and strategy, said in a telephone interview yesterday. Its early in the game for Poland, and they have significant potential reserves over there.
http://www.bloomberg.com/news/2012-01-31/exxon-says-two-polish-shale-wells-were-not-commercially-viable.html