"The discovery of a major gas field of up to 12.3 trillion cubic feet (348 billion cubic metres) in-place with exceptional flow rates makes this one of the largest gas fields to be discovered in Iraq," a statement said.

The spokesman for the Kurdistan regional government's natural resources ministry declined to comment when contacted by AFP.

Heritage, which was established in Canada and is listed in London and Toronto, said the field, located in the northeast of energy-rich and semi-autonomous Kurdistan, was called "Miran."

Heritage said it owned a 75 percent working interest in the field. It did not specify who held the balance.

"We are considering various development options including a tie-in to planned infrastructure that will achieve first production for both oil and gas in 2015," the company said.

Heritage said it was "currently considering potential development options which could include either bringing gas into Turkey and/or into Europe via the Nabucco pipeline," a proposed link to bring Asian supplies to Europe.

The Heritage announcement did not get a welcome response at the London Stock Exchange, where heritage shares fell 19.61 percent to 351 pence, at 1430 GMT.

Brokers expected the drill to be more promising: they were disappointed that the Miran deposits contained gas rather than oil, which would have had a higher market value.

They also raised concerns about infrastructure costs involved in getting the gas to market.

"The viability of such a project, which could include construction of a pipeline to Turkey, raises concerns among investors," said Sean Power, an analyst at City Index.

Heritage has exploration operations or interests in Africa, the Middle East, Russia and Malta.

earlier related report
Repsol reports new Brazilian offshore oil discovery
Madrid (AFP) Jan 26, 2011 - Spain's biggest oil company, Repsol YPF SA, announced Wednesday it had discovered "high quality crude" off the coast of Brazil in partnership with Britain's BG Group and Brazil's Petrobras.

The find was made in "ultra-deep waters" in the Santos Basin in the Carioca Northeast well in block BM-S-9, approximately 275 kilometres (170 miles) from Sao Paulo, the company said in a statement.

"Preliminary analysis shows a reservoir of 200 metres containing high quality crude. Brazil's offshore is one of the world's fastest-growing hydrocarbons reserves," the statement said.

Petrobras has a 45 percent stake in the discovering consortium and is its operator, BG Group owns 30 percent and Repsol holds the remaining 25 percent through a joint venture with Sinopec, one of China's top oil companies.

Last month Repsol shareholders approved the sale of 40 percent of its Brazilian affiliate to Sinopec for 7.1 billion dollars (5.2 billion euros).

The deal, which was first announced in October, provides Repsol with funds for development of oil fields in Brazil and created one of Latin America's largest energy companies, valued at 17.8 billion dollars.

Under the agreement, Repsol and Sinopec will continue with expansion plans in Brazil and participate, jointly or separately, in future rounds of tenders in the country.

Repsol has a significant portfolio of projects in Brazil, including a producing field, a block under development, two planned pilot projects and 14 exploration blocks of great potential.

Shares in Repsol rose 2.69 percent to 22.705 euros in early afternoon trade, outperforming the benchmark Ibex-35 index of most traded shares which gained 0.99 percent.

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