Among the most mystifying ongoing business sagas in Hungary is the question of whether claims that the country is sitting on one of the largest natural gas fields in continental Europe – containing trillions of cubic meters of gas, or enough to power it into the next century – are really true. So I was somewhat relieved, if disappointed, to see a story on Bloomberg this morning titled ” Exxon’s Failure Rate, Hungarian Flop, Led to XTO Deal,” because it at least seemed to answer the question.
But after reading through the piece carefully, it seems no one still knows whether the Máko Trough will be the source of untold riches, or just another overhyped zilch. Not much to add, other than that if anyone out there has any opinions either way, let’s hear ‘em.
Basically, Exxon finds itself sitting on a hugely significant gas find, which does exist, just the technology used and the geology are preventing its extraction. Geopolitically, it is also a game changer (think South Stream and Nabucco -this is actually the exciting story). If the gas can be extracted it will significantly impact supply security in the CEE region and the profits of Exxon. Not to mention, Exxon has sunk a considerable amount of money into it already. However, they were prepared to walk away after the second test well, but were persuaded by its partners to conduct the third test. I don’t think the article says much new, just that Exxon doesn’t want to get burned anymore, and if the Hungarian project can be salvaged so much the better.
Maybe Exxon is learning what us foreigners who live here have found out too late…Hungary sucks you. Get out early! For me it was the third girlfriend that was my demise. Stop the drilling Exxon!
@Forintman: I suppose the question for me is more technical and long-term. Basically, despite the problems Exxon has had, can one still assume that it’s more or less certain that *some day* these reserves can be recovered economically? Or is that also in question?