UPDATE:StatoilHydro To Operate Three Bahamas Oil Licenses -Co

Norwegian oil and gas company StatoilHydro ASA (STL.OS) Monday said it has reached an agreement with BPC Ltd. (BPC.LN) to operate three oil exploration licenses in the Cay Sal areas of the Bahamas.

The licenses, called Zapata, Islamorada and Falcones, are located offshore the southwestern Bahamas and fit with StatoilHydro's strategic focus, building its position in the Caribbean region, the company said.

"Limited historic 2D seismic and satellite data indicate the presence of several large structures in the license area," StatoilHydro said.

Global Exploration Vice President Erik Finnstrom said: "This is an interesting frontier exploration opportunity which we can mature in a cost-efficient manner."

Approval and award of the licenses by the Bahaman authorities is pending.

Fox-Davies Capital analysts said: "The involvement of a company of StatoilHydro's stature gives a lot of credence to the prospectivity of the area."

They said a recent report listed 18 leads in the region, each potentially holding 500 million barrels of oil equivalents in reserves.

The analysts noted the three licenses are adjacent to other licenses held by BPC in the Bahamas and also close to StatoilHydro's license in Cuban waters.

StatoilHydro has an agreement with Cuba's state oil company Cupet, Spain's Repsol and India's ONGC Videsh Ltd. on exploration and possible production in an 11,300-square kilometer area offshore Cuba.

Company Web site: www.statoilhydro.com

-By Elizabeth Adams, Dow Jones Newswires; +44 (0) 20 7842 9386; elizabeth.adams@dowjones.com

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