Valletta, Malta - There is a 20-per-cent chance of finding a commercially feasible oil and gas reserve off the coast of Malta, according to government estimates.

The prospects of two new offshore sites have been described as "more exciting," due to the fact that their geological features are similar to the oil-rich area near Libya. Wells will be sunk between 2010 and 2011.

The Times of Malta reported Monday that international oil companies licensed to conduct oil exploration around the Mediterranean island have spoken about the possibility of striking huge reserves. The Oil Exploration Department of the Maltese Resources Ministry has referred to reserves of "giant" proportions.

London-based Leni Gas and Oil PLC said last week that one of the earmarked areas may contain some five billion barrels of oil, 1.4 billion of which is probably recoverable. If that were the case it would be a major field, similar to that of Bouri in Libya.

The Maltese Resources Ministry opted for a more cautious forecast, saying that, although the study quoted by Leni was realistic and credible, the estimates were rather high.

The contracts stipulate that if oil is struck, Malta, the smallest state in the European Union, will own between 50 and 60 per cent of the reserve.

The Maltese government is, however, considering its options carefully until it determines what stake, if any, Libya will try to claim.

The subject of oil delineation areas in the Mediterranean has been a historically thorny one between Malta and Libya. The matter reached fever pitch in the early 1980s, when the Libyan authorities dispatched a gunboat to stop an Italian oil rig commissioned by the Maltese government from drilling in the Medina Bank.

The oil issue was among the subjects discussed by Maltese President Eddie Fenech Adami and Libyan leader Muammar Gaddafi in Tripoli last July. (dpa)