ExxonMobil Corp.'s subsidiary operates the Zafar-Mashal project. It started drilling the first well in November 2003 and has drilled 2,340 meters out of the 6,800 meters planned.
"There are geological difficulties, gas and water inflows are too great. It's hardly likely to overcome these problems and dig the well as deep as it planned, " an official at Socar, State Oil Co. of Azerbaijan, told Dow Jones Newswires.
Azeri specialists suggested that another well should be drilled around 50 to 100 meters away from the first one.
ExxonMobil, however, is continuing the drilling. "For the time being, we are continuing the drilling. The official decision on the fate of the well is yet to be announced," said Leila Rzakuliyeva, head of government relations at ExxonMobil Azerbaijan Operating Co.
Zafar-Mashal is expected to hold 1 billion barrels of oil and needs an estimated $2 billion in investments.
ExxonMobil owns 30% of the project, Socar owns 50% and ConocoPhillips 20%.
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