Exxon Mobil, the largest U.S. oil company, confirmed today that three high-cost exploration wells the company drilled off the coast of Brazil came up dry, a surprising failure for the company given that rivals have been successful in finding oil in Brazil's coastal areas.
Exxon Mobil (XOM) said it will further analyze data from the three wells and that it is not throwing in the towel on discovering oil in the area. The Texas-based company previously deemed the properties as ''high potential.''
Exxon said that in the fourth quarter of 2010 it wrote off the costs of two of the wells, which totaled hundreds of millions of dollars, according to the Wall Street Journal. New York-based Hess (HES), one of Exxon's partners on the project, took a fourth-quarter charge of $111 million for two of the wells.
Petrobras (PBR), also a partner on the Exxon wells, has been successful at finding new oil in areas close to the Exxon wells, perhaps making Exxon's futility look all the worse. The Brazilian government estimates the region holds 50 billion to 100 billion barrels of oil, the Journal reported.