Spain Gives Go-ahead to Canary Islands Drilling

Spain's Supreme Court approved on Tuesday a $7-billion oil exploration project off the Canary Islands, clearing one of the final hurdles for oil company Repsol to begin drilling within months.

In 2012, Spain's government granted permits for hydrocarbon exploration off the coasts of the Fuerteventura and Lanzarote islands, but they were frozen while courts decided on a number of appeals on environmental grounds.

Of the seven appeals against drilling rejected by the Supreme Court, one was from the local Canary Island government, which initially supported the project but then turned against it.

Repsol, which leads a consortium including Australia's Woodside Petroleum Ltd and Germany's RWE Dea AG , has said exploration could start in the third quarter for commercial extraction to begin in 2019 if findings are positive.

(By Andrés González; Additional reporting by Sarah Morris and Tracy Rucinski; Editing by Fiona Ortiz and Louise Heavens)