When did Oxy's drilling department decide it could drill an ultra deep (world record) well in Colombia?. You were completely out of this business till you bought back into the GOM in 2019. This one should make you nervous... APC had a 100% carry on Komodo (Up to $150MM) and still didn't drill it. Real concerns of finding gas and quickly escalating drilling costs kept them from pulling the trigger. You've got an angry tiger by the tail this time.
7 replies (most recent on top)
'Sell the offshore business and focus on what you do best. Its time'
This guy has a great sense of humor. If we sell the offshore assets, how will we do what we do best if we have no offshore platforms and 167 people on them to burn down?
Wasn’t Oxy out of Colombia? Drilling this well is unwise from a country point of view and also due to risk. Why don’t they sell or give this well to Ecopetrol?
Sell the offshore business and focus on what you do best. Its time.
I almost forgot. The discovery well (Windjammer 1) in Mozambique intersected the gas reservoir shallower than anticipated and they almost lost the well. Got the well under control , P&A'd and skidded the location... the rest is history. How much faith do you have in the geology and geophysical prognosis at Komodo?
Oxy was quick to unload Mozambique (100+ TCF upside and certified reserves) and almost Algeria (wow...good thing that deal fell through...). Decide to keep Colombia? APC spent almost 1 billion dollars on this project and got nothing in return. Failures here and West Africa precipitated Al Walker to shut down worldwide exploration and focus on low hanging US development projects and prep the company for sale. Drilling what may be one of the most technically complex wells in history is not a smart move for a US domestic producer...It's a big deal for Colombia, not so much for Oxy if things go sideways.
The gents running Oxy’s Intl & DW ops don’t have a great understanding of how to make money and make logical commercial decisions. Why else do the pump hundreds of millions of dollars into keeping the three western Gulf of Mexico spars on life support when they haven’t made positive cash flow since Oxy acquired them.
At least you have the APC drilling team that knows how to drill wells calling the operational shots.
They’ll probably find gas or drill a duster but they won’t have a Macando. I don’t know why Oxy keeps the DW and Intl assets when they want to go all in on Permian and Carbon Capture.
Oh yeah. All the ex-APC assets generate all the cash flow.
Piper Beta