A wildcat well is a well that's been drilled outside of an area known to have oil and gas. The phrase may be lighthearted, but millions of dollars can be risked on a single well without any real guarantee of success. Read on to find out more about the advantages and disadvantages of these risky propositions.
What is wildcat drilling?
The vast majority of global oil and gas production occurs in specific areas known as fields. The Permian Basin in Texas and New Mexico, the massive Ghawar field in Saudi Arabia, and the North Sea come to mind. But oil and gas producers also frequently go outside known production areas to drill so-called wildcat wells, which are extremely risky and expensive ventures that have no guarantee of success.
The term "wildcatter" originated either in the oilfields of Pennsylvania during the early part of the 20th century or in the plains of West Texas. Either way, oilmen reputedly had to deal with wildcats in the area. And while the image of a wildcatter, portrayed in a number of movies from the 1930s through the 1950s, remains that of a hardy, free-wheeling individual willing to risk everything for a potential fortune, the truth is that most wildcat wells these days are drilled by multinational oil and gas companies that can afford a dry hole or two.
