Cuba expects more oil prospecting in Gulf of Mexico

Feb 25, 2009 01:00 AM

Cuba's government still expects that more oil prospecting will be conducted this year in its territorial waters of the Gulf of Mexico, the country's Basic Industry minister said.
"Our plan is that this year we should begin conducting the first new prospecting in the Gulf," Yadira Garcia said.

Exploration work would entail the resumption of test drilling that Spain's Repsol-YPF began in 2004; Cuban authorities say the results were positive even though the finds were not commercially viable.
Garcia said that "we're already working on practically 50 % of the areas with (foreign) companies." The island needs foreign partners because it lacks the technology to tap the deepwater reserves, although US companies are not involved due to a decades-old trade embargo.

The minister had announced in April 2008 that test drilling was to resume this year in Gulf waters, where six foreign companies currently are carrying out seismic studies. Cuba's Exclusive Economic Zone off the country's north-western coast covers an area of some 112,000 sq km (43,240 sq miles) and is divided into 59 blocks.
The companies operating there are Repsol-YPF, Norway's Norsk Hydro, India's Oil and Natural Gas Corporation, Malaysia's Petronas, Venezuela's PdVSA, Vietnam's PetroVietnam and Brazil's Petrobras, which acquired the rights to one of the blocks last October.

That same month, the Cuban government said that Canada's Sherritt had cancelled its deepwater oil exploration and production contract after determining that it "wasn't worth continuing." State-owned Cuba Petroleo's exploration director, Rafael Tenreyro, said last November that -- based on "very modest" estimates -- about 20 bn barrels could lie off the island's north coast, while the US Geological Survey has estimated that the North Cuba Basin holds between 4.6 bn and 9.3 bn barrels of crude oil.
Technicians with oil companies operating in the area told that, if sufficient investment is made, the time to exploit commercially viable reserves could range from between five and six years.

According to authorities, only 30 of the 59 offshore blocks are located at water depths of less than 2,000 meters (6,550 feet).
Cuba currently imports from Venezuela more than 90,000 bpd of crude oil -- or about half the island's needs -- under preferential terms that allow the island to pay with medical, educational and sports services.

Source / EFE
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