Repsol: Lots of Nat Gas -- And Some Crude -- Offshore Venezuela

(MoneyWatch)  Repsol YPF keeps racking up major oil and gas finds. Their latest has turned out to be the biggest natural gas discovery in Venezuela's history and the fifth-largest in the world in 2009.

The Spanish oil company -- along with partner Eni -- confirmed Friday tests of its Perla 1X well offshore Venezuela indicated up to 1.4 billion barrels of oil equivalent. That means up to 7.7 trillion cubic feet of gas, enough to fulfil Spain's gas demand for five years, the company said.

During production tests, the well -- located in the Cardon IV field -- also flowed 620 barrels of oil per day, with the flow rate constrained by rig equipment restrictions, according to Repsol.

The presence of crude may help speed the field's development and make it easier to find financing, Venezuelan Energy and Oil minister Rafael Ramirez said on state television and reported by Bloomberg.

Repsol, once crippled by depleted reserves, has doubled the number of workers in its exploration unit and directed its investment towards locating new growth projects. The company has not shied away from the risks of operating in politically troublesome countries like Venezuela or Bolivia, either.

So far, this strategy is paying off. Repsol has made 15 discoveries this year including the Venus well located offshore Sierra Leone; the Abare West well in the Santos Basin, a deepwater pre-salt region located offshore Brazil; and the Guara well, where test indicate recoverable volumes of between 1.1 and 2 billion barrels of light crude and natural gas.

There are still considerable risks. Let's not forget, just three years ago Bolivian President Evo Morales seized the country's oil and gas fields and refineries. Morales negotiated new contracts with some foreign companies including Repsol.

The Perla 1X well will be co-operated by Repsol and Eni. Venezuela's state-owned company PDVSA will hold a 35 percent stake in the field. Repsol and Eni will both maintain a 32.5 percent stake.

See other BNET Energy coverage on Repsol:

• Repsol'Totally Redeems' Itself With 15th Discovery This Year
• Spillover Effect: another Pre-Salt Discovery in Brazil
• Escape Route: Brazilian Oil Field Will Limit Repsol's Exposure to Argentina
• China's CNPC eyes repsol YPF's Argentine Arm

Image of Perla 1X well offshore Venezuela from Repsol YPF