British oil firm Cairn Energy has stepped up its hunt for oil and gas off the coast of Morocco, building on its strategy to balance its exploration portfolio beyond high-risk Greenland.

The company has revealed it will pay $60m towards the costs of an exploration well in Morocco in return for a 50pc stake in a licence that it will share with smaller explorers San Leon Energy, Serica Energy and Longreach Oil and Gas.

The partners plan to drill there in the second half of next year, Cairn said.

Cairn also said it was seeking further exploration ground in Spain, adding that it had made a bid to gain exposure to exploration in Cyprus, and was planning to try to win a position off the coast of Lebanon, Reuters reported.

The company made its name with huge oil discoveries in India, but has spent the past two years focusing on Greenland, a frontier oil province, where it has so far failed to find oil.

This year, it has sought to reshape itself, buying development opportunities and lower-risk exploration in the UK and Norwegian North Sea and developing a strategy to explore in the Mediterranean and off the coast of Morocco.

Cairn said it expects to finish 2012 with cash of more than $500m, the leftovers from a multi-billion payout from selling some of its Indian assets, some of which it returned to shareholders, and some of which it spent on buying North Sea-based Nautical Petroleum and Agora Oil & Gas.

Shares in Cairn fell 1.7pc at 291.8p in early trading.

http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/9502739/Cairn-steps-up-hunt-for-oil-and-gas-in-Morocco.html