Statoil Makes Major Oil Find

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Statoil, Norway's largest oil company, and Eni SpA, Italy's largest oil company, announced a major oil and natural gas discovery at the Skrugard prospect in the Barents Sea, a find that could be Norway's biggest oil discovery in over a decade. The two companies had previously drilled two dry wells in the region before making the new discovery.

Statoil (STO) said the new discovery may hold up to 250 million barrels of recoverable reserves. That would make the new find larger than Eni's (E) 240-million barrel discovery at the neighboring Goliat field in 2000, according to Bloomberg News.

Statoil has been struggling to maintain its output levels amid declining production at maturing fields in its home country, prompting the company to look for oil outside of Norway. The company has become an active producer in the Canadian oil sands region.

The new Statoil/Eni discovery may prompt the construction of a second liquefied natural gas facility in the Norwegian Sea, a project on which Hess (HES) and Total (TOT), Europe's third-largest oil company, are also partners.

Statoil plans to drill a delineation well in the area next year, as well as another exploration well in the same license, Bloomberg reported.