UPDATE 1-Angola oil law no incentive for deepwater risk -Galp

* Says risks in deepwater exploration deserve significant returns

* Galp still eyes Angola pre-salt, despite failed bids (adds quotes, details)

By Shrikesh Laxmidas and Daniel Alvarenga

LISBON, Sept 20 (Reuters) - Angola's tax laws do not give enough incentives for companies to take risks in oil exploration such as those required in the ultra-deep water blocks known as pre-salt, the head of Portuguese oil company Galp said.

"Angola has a geology which is very attractive, with the so-called ultra-deep in the Angolan sea. But the current fiscal legislation in Angola does not stimulate risk-taking", Galp Chief Executive Officer Manuel Ferreira de Oliveira told a conference in Lisbon on Tuesday.

"Angola has a fiscal legislation for oil that is called production sharing agreement, and in which companies invest, have some mechanisms to protect investment risk, but that also caps the returns," he added.

Ferreira de Oliveira said ultra-deep offshore oil is clearly one of "very high risks", and for which there should be high levels of capital remuneration.

Galp has been investing heavily in projects such as Tombua-Landana in Angola, Africa's second largest oil producer after Nigeria.

The company said in April it expected to more than double its Angolan oil production to 40,000 barrels per day by 2017.

Unlike in Brazil, however, where Galp is a minority partner with state-run oil company Petrobras in massive subsalt offshore discoveries, the Portuguese company was unsuccessful in its bids for deep water concessions in Angola earlier this year.

Angola issued concessions across 11 deep water blocks to seven bidders in January, including BP , Total , Eni and other international majors.

Still, Ferreira de Oliveira said his company is monitoring the situation.

"We'll see what happens, let the process conclude, see some exploration and analyse the level of risks involved," he said, adding that the company's experience in Brazil leads it to expect the first estimates for Angola's deep water reserves to appear only in around five years' time. (Reporting By Shrikesh Laxmidas and Daniel Alvarenga; Editing by Axel Bugge and Anthony Barker)