Repsol YPF Moving Forward with Canary Island Exploration

Repsol YPF has presented its plans for exploration off the coast of the Canary Islands to the Fuerteventura local authorities at a meeting with the authorities, representatives from the opposition, and company management.

Earlier this year, Repsol YPF was granted the necessary government permits to conduct exploration offshore to the west of the Lanzarote and Fuerteventura islands, in an area from 32 to 80 kilometers distant from the Canary island coast. Activity in this area is classified as "high risk exploration", meaning that there is no proof of the existence of hydrocarbons, although studies carried out between 1978 and 1983 by the former state-owned companies Eniepsa and Hispanoil give grounds for positive expectations.

Work is currently being undertaken on the design, acquisition and processing of data from 3,000 km2 of seismic 3D, and this will continue during 2002-2003, after which it would be possible to drill discovery wells in 2004. On the analysis of seismic and production tests from these wells will depend whether work on the project continues or is abandoned. Drilling would only begin once the necessary additional government authorities had been granted, and if the results obtained showed the area to have a clear potential.

At this point, Repsol YPF will carry out an Environmental Impact Assessment, defining the impact of the several alternatives for the project, and the most appropriate preventive techniques, as required by national and international law.