Repsol Participates in Libyan Oil Discovery

Repsol YPF has made a potential commercial oil discovery in Libya, sources at one of the companies in the field's five-member partnership told Dow Jones Newswires Friday.

One of the sources said the discovery is in the H-field of Block 186a in Libya's Murzuq basin.

A market source close to the deal confirmed the discovery.

Repsol is the operator and holds a 12.8% stake in the field. The other shareholders are Libya's National Oil Corp. with a 60% share in the project, Total with a 9.8% stake, OMV with 9.8% and Norsk Hydro with an 8% holding.

The sources said the exact size of the field hasn't been determined, but technical data has suggested it to be a field of similar size to two other fields in the basin.

A-field and D-fields in the region are each estimated to hold 144 million barrels of crude each and jointly will produce 75,000 barrels a day of production. A-field is currently producing around 16,000-17,000 b/d, and D-field is expected to begin production this year.

Delineation wells to be drilled later this year at H-field will help determine the size of the discovery, the sources said.

Four out of 10 exploration wells drilled in the Murzuq region have resulted in commercial finds, one of the sources said.

Repsol's Web site said the company had made two significant discoveries in the Murzuq region, in Block NC-115 at O1 and N2 wells.

Production from fields A, D and now H will be connected to the El-Sharara facilities via a 31 kilometer long oil pipeline and transported by pipeline to the Zawai harbor in the Mediterranean. The basin is about 500 miles south of Tripoli in the Sahara Desert.

A Repsol spokesman declined comment on the discovery, and a spokesman from the National Oil Corp. wasn't immediately available for comment.