Repsol also gave its first idea of costs for extracting shale oil from its find in Argentina, where it expects to produce a maximum 12,000 barrels of light sweet oil per day (bpd), saying on Thursday total investment could be $20 billion.

Repsol’s third-quarter oil and gas output was hit by ongoing stoppages in the Gulf of Mexico following the Macondo spill, rig maintenance, and, most importantly, the hit to output from Libya, where Repsol has recently restarted activity.

“We are producing 100,000 barrels per day in Libya and expect it to rise to 170,000 next year. It could be more but we are being cautious,” chief financial officer Miguel Martinez told analysts.

Repsol extracts oil from the Murzuq Basin in Libya in a consortium with Austrian group OMV and Italian company ENI, which was producing 330,000-340,000 bpd before the civil war. Earlier, OMV said output had recovered to nearly a third of pre-war levels.

Repsol shares were down 1.4 percent at 1605 GMT.

Repsol’s estimate for peak production from its new Argentine shale oil find of around 12,000 bpd compared with forecasts for 50,000 bpd given by the head of exploration at its YPF unit on Tuesday. 

It said extracting the non-conventional oil and gas from the difficult geological formation containing an estimated 927 million barrels of oil equivalent could cost $20 billion.

“It is still very much up in the air, but initially the capital expenditure to develop the field does look high for a company like YPF, considering that there are many regulatory and fiscal issues still to be cleared up,” Intermoney’s Alvaro Navarro said. 

Repsol moved to calm investor concern about regulatory uncertainty in Argentina after new laws on oil export revenues. “We have reached a situation with the Argentine government that is good for both parties. So, I do not think there will be any change in regulation,” Martinez told analysts.

Repsol has earmarked 400 million euros ($543 million) next year to develop the field.

Repsol said third-quarter net profit fell 14.5 percent as higher financial costs compounded a fall in oil and gas production and a lower profit in the downstream division.

Net profit adjusted for one-time items and inventory costs (CCS adjusted net) came in at 429 million euros, compared with a forecast for 420 million in a Reuters poll.