Arab Strife Pushes Big Prize Oil Search to Morocco, Malta

Executives say governments often seek to change terms once big finds are made, but for now half a dozen companies polled by Reuters say the incentives are worth the risk.

The Moroccan government take of cash flow produced from any oil or gas field in Morocco would be about 30 percent lower than what was typical for Algeria, Libya and the rest of the North African and Middle East region, Wood Mackenzie analysts estimated.

One company looking at the region said the fiscal terms in Spain were as attractive as Morocco.

Like Morocco, Spain is a big energy importer, buying in over 80 percent of its energy needs, spending more than 40 billion euros - or about 4.5 percent of gross domestic product - a year.

In the midst of an economic crisis and struggling to keep energy debts in check, the country is keen to develop any oil and gas reserves it might have.

"We're looking for hidden value in Spain," Cairn Chief Executive Officer Simon Thomson said, explaining that a historic focus on beach tourism meant that much of the deep water off the country's coast had never been drilled.

"We do want to invest there...It's part of our long term plan to position ourselves."