Oil & Gas
Dry Hole Write-Off
Writing off the cost of an exploratory well that found no commercially viable hydrocarbons.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Dry Hole / Exploration Write-Off (Expense) | Expense (+) | 18,000,000.00 | - |
| Exploration & Evaluation Assets (E&E) | Asset (-) | - | 18,000,000.00 |
💡 Accountant's Note
A dry hole is an exploration failure. When a well proves non-commercial, all associated E&E costs must be written off immediately. This is one of the highest-risk aspects of oil & gas accounting — explorers may write off many wells before finding a commercial discovery.
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