Kiran Stacey Maybe Exxon was right: Desire crashes to earth

I blogged on Friday about how one of the Wikileaked (can we use that as a verb yet?) cables showed ExxonMobil’s scepticism about Falklands oil. The memo said:

ExxonMobil International Chairman Brad Corson told us he does not believe there is enough oil on the Falkland Islands Continental Shelf to be profitable, citing Shell’s earlier oil exploration attempts which they abandoned.

At the time shares in the major companies drilling for oil in the area were unchanged – after all, it didn’t sound like Corson knew anything nobody else did.

But Corson and his fellow Falklands-sceptics look a little more in the right today, after a rather dramatic statement from Desire Petroleum today.

Just a week after announcing a new oil find, Desire said this morning:

Sampling of the main sand has shown that the hydrocarbons are residual and that the mobile fluid is water.

Desire has, in effect struck water, and the well will “be plugged and abandoned”.

And this is the effect on the shares: