After Repsol YPF's (REP) natural gas find in offshore western Venezuela, Russia's Gazprom OAO (GAZ.RS) confirmed Friday it is still exploring for gas in the same general area.

"Currently Gazprom continues drilling works at the Urumaco-1 Block and looks forward to positive results," Gazprom's press service said in an e-mailed statement.

Gazprom and Repsol, as well as U.S.-based Chevron Corp. (CVX), won exploration drilling rights to the first handful of 29 blocks that form the Rafael Urdaneta project, launched by the Venezuelan government in 2005 in the waters off northwestern Falcon state's coast.

Repsol, in partnership with Italy's Eni SPA (E), is the only one of the three companies to announce a significant find. It said last week it found reserves at its Cardon IV block that could hold between 7 trillion and 8 trillion cubic feet in recoverable reserves. If confirmed, that could be the biggest natural gas discovery in Venezuela's history.

Chevron said earlier in the week that it, too, continues to look for gas in the area, in its Cardon III block. Repsol's successful block is sandwiched between Chevron's block and Gazprom's Urumaco I block, and analysts say it's reasonable to assume there could be a degree of spill-over.

At the same time, however, analysts warn Venezuela's tricky regulatory and operating environment - including concerns of more nationalizations by the socialist government and little investment in the gas sector - suggest commercial development of any gas discoveries may be difficult.

-By Dan Molinski, Dow Jones Newswires; 58-212-284-5651; dan.molinski@dowjones.com