French oil giant Total will halt preliminary oil survey work off disputed Western Sahara, a region controlled by Morocco, due to disappointing results, a source said Monday.
"Total has informed the Moroccan authorities that it would not request a new extension of its reconnaissance authorisation in the Anzarane block," said the source.
"The first analysis of seismic data didn't find anything," added the source.
However the decision comes less than two weeks after a farm trade deal between the European Union and Morocco was annulled by the EU's top court because it illegally involved the disputed region of Western Sahara.
It also comes as oil companies are slashing investment as oil prices slide to 11-year lows, making many offshore projects no longer financially attractive.
Total received the contract to conduct geological survey work in the vast 100,000 block off Western Sahara in December 2011 and it was extended to December 2015, according to Total's website.
The agreement excluded formal exploration work.
"The results of the geological surveys conducted in the Anzarane block... were not encouraging and the reconnaissance authorisation will not be transformed into an exploration licence," a Total spokesman told AFP.
Total's work off Western Sahara had been controversial as the region has been disputed since Morocco took control of most of the territory in November 1975 after the end of Spanish colonisation, unleashing a war for independence that lasted until 1991.
A UN-brokered ceasefire between Morocco and the Polisario Front, a movement in Western Sahara that has been campaigning for independence for decades with the backing of Morocco's arch-rival Algeria, has held since then, but UN efforts to organise a referendum on the territory's future have been resisted by Rabat.
Total insists on its website that independent experts it had consulted said the geological and geophysical works it carried out in the Anzarane block were "not legally in breach with international law or the United Nations charter".
The Total spokesman said the company remains committed to the Moroccan market, noting in particular its filling station network had listed on the Casablanca stock exchange, as well as discussions on importing liquefied natural gas.