2nd UPDATE:StatoilHydro,BPC Partner On 3 Bahamas Oil Licenses

Norway's StatoilHydro ASA (STL.OS) and Bahamas-focused BPC Ltd. (BPC.LN) have joined up to exploit three oil exploration licenses in the Cay Sal areas of the Bahamas, the companies said Monday.

The licenses, which will be operated by StatoilHydro, are called Zapata, Islamorada and Falcones and are located offshore the southwestern Bahamas.

"Limited historic 2D seismic and satellite data indicate the presence of several large structures in the license area," StatoilHydro said in a statement. The assets fit with StatoilHydro's strategic focus and build its position in the Caribbean region, the company said.

BPC Limited's Chief Operating Officer Paul Crevello told Dow Jones Newswires the licenses, which lie between BPC's existing Bahamas assets and StatoilHydro's Cuban interest, probably contain light oil.

He couldn't divulge details of the agreement between the two companies, but said it will play out in three phases, with the finishing touches to be agreed after the Bahamas authorities have approved license applications.

Crevello said BPC will carry out new seismic surveys in the Bahamas and could be producing from its existing assets in the Bahamas within five years. Before today's agreement, it was the only oil company operating in the region.

Oil could be exported by pipeline or ship to the U.S. market and also consumed domestically, Crevello said.

"Some of the structures are very large. There is potential for multiple 500 million cubic meter (of reserves) fields," he said.

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

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 so-called competent persons report, or CPR, listed 18 leads in the region.

StatoilHydro has an agreement with Cuba's state oil company Cupet, Spain's Repsol (REP) and India's ONGC Videsh Ltd. (500312.BY) on exploration and possible production in an 11,300-square kilometer area offshore Cuba, while BPC holds five petroleum licenses covering 15,676 square kilometers around the Bahamas.

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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