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Norwegian oil giant Statoil ASA (STO - Analyst Report) has found a large deposit of light, high-quality oil in the Flemish Pass Basin, offshore Newfoundland.

The oil was discovered in the Harpoon prospect in EL 1112. The field is situated about 500 kilometers north-east of St. John's, the capital of the Canadian province of Newfoundland and Labrador. The resource potential of the prospect is yet to be established.

The semi-submersible rig West Aquarius was used to drill the Harpoon discovery to a water depth of about 1,100 meters. Statoil is the operator of Harpoon, with 65% interest, while its partner Husky Energy holds the remaining 35%.

Statoil encountered oil at Mizzen, 10 kilometers from the Harpoon well that produced positive results in 2009. The Mizzen discovery is estimated to hold recoverable reserves in the range of 100-200 million barrels of oil.

Currently, Statoil is drilling the Federation prospect in the Jeanne d'Arc Basin offshore eastern Canada. As part of its planned three-well exploration program offshore Newfoundland for this year, the company will then return to Flemish Pass Basin to drill the Bay du Nord prospect, which is located south-west of the Harpoon and Mizzen discoveries.

With plans of drilling about 50 exploration wells worldwide in 2013 and about 20 high impact wells between 2013 and 2015, Statoil will have new frontiers to operate. The new regions include the U.S. Gulf of Mexico, Australia and Brazil.

The latest find in Canada's Atlantic region highlights the fast-growing petroleum play that is frequently overshadowed by the country's western oil-sands developments. Several major players including ExxonMobil Corporation (XOM - Analyst Report) have proposed to invest in this region.

Statoil carries a Zacks Rank #5 (Strong Sell). However, there are other Zacks Ranked #1 (Strong Buy) stocks – Newpark Resources Inc. (NR - Snapshot Report) and Gulfmark Offshore, Inc. (GLF - Snapshot Report) – that are expected to perform impressively over the short term.

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