Genel, Partners Find Oil off Morocco

Genel Energy and two partner firms said on Monday they had discovered oil off Morocco, giving a boost to the region whose oil and gas drilling results have so far been mixed.

Genel's minority partners in the Sidi Moussa-1 well, Serica Energy and San Leon, announced they had drilled nearly 3,000 metres below the sea and encountered oil.

"We are at a very early stage and the presence of hydrocarbons in this frontier block will require further evaluation," said Tony Craven Walker, chief executive of Serica, which holds a five percent interest in the block.

Genel, which operates the well and owns a 60 percent interest, said it was too early to say whether the oil discovery was successful.

Morocco has opened its waters to oil and gas drilling and has awarded dozens of permits to energy firms to tap its offshore resources.

Drilling results have been mixed but positive discovery news from the Sidi Moussa field, located in one of the blocks closest to the coastline, gives a boost to Morocco's oil prospects.

"While these initial results are encouraging ...much uncertainty still exists on the commerciality of the discovery both in respect of size of the discovery and ability to flow well at commercial rates," said analysts at FirstEnergy (FE).

Reporting by Karolin Schaps