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CUBA: Balancing Bane and Blessing of Oil

Patricia Grogg

HAVANA, Apr 7 2011 (IPS) - Cuba is sticking to its plans to begin oil exploration this year in its territorial waters in the Gulf of Mexico, and has assured neighbouring countries that “every reasonable” safety and environmental protection measure will be taken, in an area still haunted by the disastrous effects of the crude oil spill in 2010.

The announcement by a Cuban expert that five wells would be drilled in the area by seven foreign partners, beginning “this summer” and continuing until 2013, was food for thought for those who are concerned that finding oil might be more of a bane than a blessing, in the light of recent events in Libya.

However, an academic interviewed by IPS said “although (external) aggression against Cuba is an ever present risk,” the situation in this Caribbean country bears no comparison to that of Libya, where there was an internal split involving part of the armed forces “that is being exploited by imperialists.”

If something similar were to happen in Cuba, it could serve “as justification for military intervention of some kind, but this scenario is entirely imaginary and has no basis, no matter how many millions of dollars the United States spends every year to foment it,” said the academic, an expert in international affairs.

The expert, who requested anonymity, agreed with those who attribute military air strikes against Libya to the interest of Washington and its European allies in seizing control over Libya’s oil reserves, estimated at 42 billion barrels, as well as in preventing the spread of popular uprisings in the Arab world.

In his view, there are no internal political divisions in Cuba, and oil is a powerful economic interest that is likely to work in the island’s favour, since as soon as significant quantities of oil are proven, U.S. companies will be likely to lobby for the lifting of the nearly five-decade embargo that prevents them from participating in this country’s oil industry.

At present Cuba produces some 21 million barrels a year of oil and gas, equivalent to only 46 percent of its needs, and imports from Venezuela a further 100,000 barrels a day of crude. A few years ago it began to focus exploration efforts on its exclusive economic zone (EEZ) in the Gulf of Mexico.

The prospects of finding crude in deep waters “are quite promising,” said Manuel Marrero, a top expert at the Ministry of Basic Industry, who told reporters he had dreamed of a significant discovery “for 50 years.” He was speaking at an international congress that ends Friday.

“We are all hopeful that there are probabilities of finding large oil and gas deposits,” Marrero said, after announcing the start of drilling in that area, where 22 out of 59 blocks available for joint ventures with foreign companies, including U.S. multinationals, have already been leased.

For operations in deepwater (400 to 1,500 metres) and ultra deepwater (over 1,500 metres), foreign partners have leased a platform regarded as one of the best in terms of safety and technology, that is due to arrive in Cuba in mid-2011.

The oil rig that will be used “is one of the world’s safest and most modern” and will operate under “very strict” regulations, Marrero said.

Cuba also has contingency plans in case of hurricanes or other extreme phenomena.

“We offer the same guarantees as the international oil community,” Marrero told IPS, while he avoided mentioning U.S. legislators who want to bring pressure to bear to stop the drilling because of its alleged environmental risks.

The Cuban safety strategy takes into account the lessons learned from the explosion in the Gulf of Mexico on the Deepwater Horizon platform leased by BP (formerly British Petroleum), which spilled five million barrels of crude between April and July 2010 and caused severe damage to the environment and wildlife in vast ocean and coastal areas.

A consortium headed by the Spanish company Repsol-YPF will begin drilling the first well as soon as the Scarabeo 9 platform, manufactured in China, arrives in Cuba.

In 2004, Repsol-YPF did preliminary offshore exploration work in Cuba and found oil that was of high quality, but was deemed “commercially non-viable.”

After the Spanish company has drilled wells, the Malaysian oil company PETRONAS, the Indian ONGC Videsh and the Venezuelan state-owned oil company PDVSA, among others, are expected to take their turns with the rig.

Late last year, Venezuelan President Hugo Chávez said Cuba has significant oil reserves in its EEZ in the Gulf of Mexico.

“We know Cuba has a great deal of oil, and soon we will be drilling our first well here,” Chávez said during a visit to Havana.