There's something wrong with the idea that Paloma would be a complete failure. A setback, yes (more sand stuck in gear, poor results at the layer targeted, etc).
But NEN is drilling a dome with a few potential reservoirs, not one, and it is surrounded by OXY which apparently is seeing huge potential (any results?) with this area. There are also the seismic data indicators, past oil boom (much shallower layers without current technology), and evidence from the earlier Paloma drilling.
But if indeed Paloma is a let down, then it's a lesson to junior oilers: don't drill just one area and at a snail's pace (fortunately, NEN is now securing new leases in Calif). Diversify and get your own equipment to keep the business moving forward.
NEN Price at posting:
23.0¢ Sentiment: None Disclosure: Held
