Commercial Well

DEFINITION of 'Commercial Well'

Any oil or gas drilling site that produces enough oil or gas so as to be commercially viable. All wells that investors are willing to put money into are considered to be commercial wells. Sites with non-producing wells fall outside this category, as do sites with only one or two wells (unless their production is extremely high on a consistent basis).

BREAKING DOWN 'Commercial Well'

Limited partnerships typically will syndicate a share of a commercial well. As well, owners of working interests and those who receive royalties also invest in commercial wells. Investment interest in viable commercial wells is often high, due to their inherent profitability.