Can You Dig It, Exxon?

Next time you're on a commercial airline flight that has reached its cruising altitude, stop to consider that you're probably just about as far above the earth's surface as ExxonMobil (NYSE: XOM) has drilled below it in its quest for oil and gas.

Last week, the company announced that its subsidiary, Exxon Neftegas Limited, had completed the drilling of its Z-11 well, the deepest measured extended-reach drilling (ERD) well in history. At 37,016 feet, the well is more than seven miles deep -- a typical cruising altitude for today's commercial airliners.

The well was drilled on Russia's Sakhalin Island from the Yastreb rig, the world's largest onshore rig. It's part of the multiphase Sahkalin-1 project that includes the Chayvo field, which is located five to seven miles offshore. ERD drilling, a form of horizontal drilling that has been used in one form or another for about two decades, permits deviation from the vertical in drilling, therefore allowing offshore wells to be drilled from onshore locations.

ERD drilling has been developed and improved by such oilfield service companies as Schlumberger (NYSE: SLB) and Baker Hughes (NYSE: BHI). According to ExxonMobil, since the first Sakhalin-1 well was drilled in 2003, the time necessary for the drilling of these technologically sophisticated wells has been reduced by 50%. The Z-11 well was drilled in 61 days, more than 15 days ahead of schedule.

But what does all this mean for Foolish investors? I think it has at least two takeaways: First, it indicates the extreme efforts that the leading energy companies must constantly undertake to locate new supplies of oil and gas. And second, I think it evidences my reason for attempting to err on the side of technological sophistication in selecting energy investments. The latter is but one reason I'm drawn to all three of the abovementioned companies.

For related Foolishness:

• ExxonMobil Works to Bulk Up
• Downstream Saves ExxonMobil's Day
• Energy's Excessively Short-Term Orientation

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Fool contributor David Lee Smith does not own shares in any of the companies mentioned. He welcomes your questions or comments. The Fool has a disclosure policy.