Repsol, through its subsidiary company Repsol Exploration U.K. Ltd., and Nippon Oil Exploration and Production U.K. Ltd. have reached an agreement whereby Repsol sells its 5% stake in the Magnus field, in the U.K. North Sea, to Nippon Oil. This agreement is subject, among others, to approval by the British Secretary of State for Trade and Industry.

The Licence sold refers to blocks 211/7a and 211/12a, and includes the Magnus field and its satellites South Magnus and Northwest Magnus, together with related interests in the regional oil and gas transmission and distribution system.

Magnus field was discovered in 1974 and went on stream in 1983. Repsol acquired its stake in 1989. The field�s cumulative production to the end of June 1996 exceeds 612 million barrels of oil, which is currently estimated as 75% of the field�s reserves.

Repsol has conducted exploration and production in the U.K. since 1976, with an interest in several fields on the British Continental Shelf, including Harding and Buckland. Repsol has a 25% stake in the Harding field, on block 9/23 B in U.K. North Sea waters, 320 Km. to the north-east of Aberdeen, which went on stream last April. Total average production in September was 67,000 barrels of oil per day, of which 16,750 pertain to Repsol. Proved recoverable reserves of this field are in the range of 185 million barrels of oil (46.3 of these net for Repsol) and 200,000 million cubic feet of gas (50 million cubic feet net for Repsol).

In recent years, Repsol has consolidated its presence in the United Kingdom and this transaction forms part of the company�s strategy to rationalise its assets portfolio, continue raising production profitability and improve economic and operating margins. In fact, Repsol took up its minority stake in Magnus mainly for tax considerations no more applicable to date, and now disposes of its interest at an appropriate moment in the life of the field, under sale conditions actually in accordance with the present market trend for E&P assets valuation in the U.K. North Sea.