Dry Holes and Discoveries

Some suggestions of success on both sides of the Atlantic

Some of the riskiest gambling anywhere is not in Atlantic City, N.J., but in a rough region 75 miles or more to the east. There, 39 companies have anted up $1.1 billion for leases to drill for oil and gas deep under the sea. While there is nearly a fifty-fifty chance of winning at blackjack, the odds of striking black gold offshore are 1 in 10--and there have been a lot of losers. Last month Continental Oil Co., having drilled a 12,000-ft. dry hole in the Baltimore Canyon off the Jersey shore, capped the test site and wrote off the $4 million loss. Last week Shell Oil, along with eight partners, having drilled deeper (14,000 ft.) and spent more ($6 million) at a nearby site, said that it too had struck a "duster."

But, incurable gamblers that they are, oilmen seldom quit. Shell is moving its rig southward and, along with a group of 18 partners, will sink a second well, to a planned 16,000 ft. Mobil, Exxon and Texaco are pressing ahead with test borings of their own. They recognize that a few disappointments should not cause them to give up the search at sea. So far, only two test wells-the Conoco and Shell dry holes-have been drilled to completion in the Baltimore Canyon. By comparison, at least eleven were sunk into Alaska's North Slope before a good find was made. In the North Sea, it took 50 false starts, and in oil-rich Western Canada the number reached 133.

Last week Texaco issued a cautious statement suggesting that it might be close to a find at 15,000 ft. in a Baltimore Canyon test site that it shares with several partners, including Getty Oil, Sun Oil and Allied Chemical. The company stressed that no firm conclusions could be drawn from its samples, but the mere hint of a strike sent Texaco's stock up 2 1/2 points, to 26 3/8.

Across the Atlantic, a stock market flurry was touched off in London by reports that British Petroleum had discovered a potentially huge field. It is in a lightly explored region 30 miles west of the Shetland Islands, which are off the Scottish coast and far distant from Brit" ain's already rich North Sea fields. BP, which shares the site with Chevron, Imperial Chemical Industries and the British National Oil Corp., confirmed that it had hit oil but reported that it did not know how much.

Independent oil brokers in Scotland, who claimed to have received reports directly from the rigs, said that the field could contain as much as 13 billion bbl., nearly as much as Alaska's North Slope. By comparison, Britain's North Sea fields are thought to contain anywhere from 19 billion to 30 billion bbl.

An executive of the state-run British National Oil Corp. was convinced that there is a huge lode of oil in the Shetlands area, but agreed with other petroleum experts that it would take several years to develop the technology to exploit it. Reason: initial samples show it to be much heavier and more viscous than North Sea oil, and therefore more expensive to raise and refine.

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