Although Houston’s economy is no longer as dependent as it once was on oil (something that one MSNBC producer seems to need to repeat to himself in order to believe), international oil and gas exploration, production, and trading are still mainstays of the local economy.
That’s why, as Eric Siegmund points out, it’s especially painful to read of ExxonMobil’s decision to abandon a recent ultradeep well in the Caspian as noncommercial.
Too many folks are under the impression that “Big Oil” merely sticks a pipe in the ground and reaps the benefits of $50/barrel oil. In reality, drilling a single well involves all sorts of geological, engineering, fiscal, environmental, regulatory, and political complexities, just to start. It’s not a cheap business, as is illustrated by Eric’s post about ExxonMobil having to write off a $100 million drilling project that, according to the best judgment and planning by the world’s foremost energy company, should have been a success.
That’s the nature of the business, as many Houstonians know.
(10-07-2004 Update) A correction has been posted above. A reader points out that I used the term ultradeepwater when I should have used the term ultradeep. That’s a significant difference, and the text has been corrected. We appreciate our smart readers keeping us on our toes!
