Oil prices lead legislators to urge dropping Cuba ban

Posted on Fri, May. 12, 2006

Oil prices lead legislators to urge dropping Cuba ban
By Lesley Clark
KNIGHT RIDDER

WASHINGTON - Two critics of the law that bans U.S. companies from doing
business in Cuba want to relax the embargo to allow the American oil and
gas industry to partner with Cuba to drill near the island nation.

Such efforts have been rebuffed in past years, but the legislators
suggested Thursday that public anxiety over the rising cost of gasoline
may provide enough momentum.

"I'm convinced the world has changed significantly," said Sen. Larry
Craig, an Idaho Republican. "With $3 gas a reality to the consumer, it
causes us to reexamine policy."

He and Rep. Jeff Flake, an Arizona Republican who has long championed
relaxing sanctions against Cuba, filed legislation Thursday in the House
and Senate, picking up support among legislators eager to show they are
taking action to ease soaring energy prices.

Flake noted that one of his co-sponsors, Rep. Marilyn Musgrave, R-Colo.,
had opposed his earlier efforts to relax the ban on most travel to Cuba.

But supporters of the embargo, including President Bush, were quick to
dismiss the effort. Bush told reporters in Orlando on Wednesday that he
is opposed to allowing companies to work with Cuba.

Joined by Sen. John Thune, R-S.D., Craig and Flake noted that some of
the country's biggest competitors for energy are already involved in oil
and gas exploration efforts off the north coast of Cuba -- about 50
miles from Key West.

"We need to be able to compete for resources that are off America's
coast," Thune said. "Countries like China are able to take advantage of
the rich resources off the coast. If we don't, they will."

Though few rich veins have been tapped, Craig said the U.S. Geological
Survey has estimated there could be as much as 9 billion barrels of oil
in the area.

And he suggested there is an environmental benefit to U.S. involvement,
suggesting that the countries now drilling off Cuba do not have the U.S.
oil industry's experience.

"If oil is going to be developed 50 miles from the Keys, then it ought
to be by the world's expert and the world's best," Craig said.

The Cuban government -- which does not have the technology required for
such deep-water drilling -- has entered into agreements with several
companies, including some from Spain, China and Canada.

And U.S involvement would be more than welcome, Craig said.

He noted that on an agricultural trade mission to the island two years
ago, the interior minister of Cuba encouraged him to "convince the
American government to allow U.S. companies to participate.

"It was briefly discussed, but of course current policy simply was not
going to allow that to happen," Craig said.

U.S. companies are eager to explore the area. Executives from U.S.
giants including ExxonMobil Corp., Caterpillar and Valero Energy Corp.,
one of the largest U.S. refiners, each paid about $2,000 to attend a
meeting in Mexico in February to learn more about Cuba's oil fields.

Efforts to relax the U.S. embargo -- or even scrap it altogether -- have
increased since the late 1990s with legislators from agricultural states
eager for new markets and critical of a policy they say is largely a
function of Florida politics.

But critics of the embargo were defeated in the House last year when
they tried to ease other sanctions against Cuba. And Bush, who has
threatened vetoes against such efforts, said Wednesday he is against it.

"I know the money would go to support a government that is suppressing
the rights of its people," he told Florida reporters at an interview in
Orlando.

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