15 November 2011 Last updated at 13:20 GMT
Cuban oil project fuels US anxieties
Michael Voss By Michael Voss BBC News, Havana
A massive $750m (£473m) Chinese-built oil rig, the Scarabeo 9, is due to
arrive in Cuba before the end of the year, to begin drilling a series of
exploratory wells.
A whole range of international oil companies from Spain, Norway, Russia,
India, Vietnam, Malaysia, Canada, Angola, Venezuela, and China - but not
the US - are lining up to hire the rig and search for what are believed
to be substantial oil deposits.
"We will drill several wells next year and I'm sure we will have
discoveries. It is not a matter of if we have oil, it is a matter of
when we are going to start producing," Rafael Tenreiro, head of
exploration for the Cuban state-owned oil company Cupet, confidently
predicts.
The Spanish company Repsol will be the first to drill, with an
exploratory well in extremely deep water just 50 miles (80km) off the
coast of Florida.
Be prepared
It has sent alarm bells ringing in the United States because if there
were an accident, the ocean currents would push any oil spill onto
Florida's beaches and the Everglades.
Yet under the US trade embargo, neither American firms nor the Coast
Guard could come to Cuba's assistance or provide much needed equipment
such as booms, pumps, skimmers and oil dispersant systems.
The Cubans would need to turn to the Norwegians, British or Brazilians
for help.
"In the event of a disaster we are talking a response time in terms of
equipment of four to six weeks as opposed to 36 or 48 hours. This is a
serious impediment," warned Lee Hunt, president of the Texas-based
International Association of Drilling Contractors.
Mr Hunt was part of a team of oil industry and environmental experts who
were given permission by the Obama administration to visit Cuba to
discuss safety issues with the authorities in Havana.
Leading the group was William Reilly, a former head of the US
Environmental Protection Agency and co-author of the government report
into last year's BP oil disaster.
He was impressed with Cuba's awareness of the risks and knowledge of the
latest international safety measures.
Continue reading the main story
"The decaying Cuban regime is desperately reaching out for an economic
lifeline"
Ileana Ros-Lehtinen Anti-Castro US Congresswoman
The explosion and blow-out aboard BP's Deepwater Horizon rig off the
coast of Louisiana killed 11 people and spilled 5m barrels of oil into
the Gulf of Mexico. It was one of the worst environmental disasters ever
to hit the Gulf Coast.
It took 85 days to cap the well head, which was 5,500 feet beneath the
surface. The Scarabeo 9 will be drilling in even deeper water.
After his talks with Cuban officials, William Reilly said he found them
serious about safety and aware of international best practice but
lacking in experience.
He wants to see the US co-operate with Cuba on safety issues and ease
the embargo to allow US companies to assist in case of an emergency.
"It is profoundly in the interests of the United States to prepare the
Cubans as best we can to ensure that we are protected in the case of a
spill. We need to make it 'Key West safe'."
But Florida's powerful Cuban-American lobby has other ideas and with the
2012 presidential election looming, Barack Obama is in a difficult position.
Oil windfall?
The anti-Castro groups want the administration to take action to halt
the drilling altogether and not just for safety reasons.
A major oil find would make this communist-run Caribbean island
financially independent for the first time since the revolution in 1959.
For more than half a century Cuba has been dependent on the largesse of
its ideological allies. First it was subsidised by the Soviet Union,
then more recently Venezuela and, to a lesser extent, China.
Cuba has long produced some oil from a series of small onshore and
coastal deposits.
Tourists going from Havana to the beach resort of Varadero drive past
several kilometres of nodding donkeys and the occasional Chinese or
Canadian drilling rig.
Cuba currently produces about 53,000 barrels of oil a day but still
needs to import about 100,000 barrels, mainly from Venezuela.
Its deep territorial waters, though, lie on the same geological strata
as oil rich Mexico and the US Gulf.
Estimates on just how much offshore oil Cuba is sitting on vary. A US
Geological Survey estimate suggests 4.6bn barrels, the Cubans say 20bn.
Even the most conservative estimate would make Cuba a net oil exporter.
A large find would provide untold riches.
It is one of the US-based anti-Castro lobby's worst nightmares.
"The decaying Cuban regime is desperately reaching out for an economic
lifeline, and it appears to have found a willing partner in Repsol to
come to its rescue," Ileana Ros-Lehtinen, the Cuban-born Republican and
Chairwoman of the influential House Foreign Affairs Committee, said in a
statement recently.
The Florida Congresswoman and a group of 33 other legislators, both
Republican and Democrat, wrote to Repsol warning the company that the
drilling could subject the company to "criminal and civil liability in
US courts".
Repsol responded saying that its exploratory wells complied with all
current US legislation covering the embargo as well as all safety
regulations.
A Havana street If oil exploration goes well, Cuba could meet its energy
needs and become a net exporter
It has also agreed to allow US officials to conduct a safety inspection
of the Chinese rig before it enters Cuban waters.
Under the embargo it is limited to just 10% American technology.
The rig was fitted in Singapore and the one piece of US equipment which
was installed was the blow-out preventer.
It was the failure of BP's blow-out preventer which was at the heart of
that disaster.
According to Lee Hunt, the Scarabeo 9 is a state of the art deep-water
rig and there are six similar platforms built at the same Chinese
shipyard currently operating in US waters.
For the moment environmental concerns appear to be taking precedence
over politics.
The government will take up Repsol's offer to inspect Scarabeo 9 and a
limited number of licences have been issued to US clean-up operators to
enter Cuban waters and assist in the event of a spill.
But the arguments are far from over as environmentalists are pushing for
greater co-operation while Cuban-American groups are looking at ways to
place legal and legislative hurdles in the way.
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