Two recent moves have confirmed the re-launching this year of Cuba’s bet on its oil potential. At the start of this month the Cuba Petróleo enterprise (Cupet) announced the opening of new maritime areas to the prospecting of deposits by foreign companies. This came when a delegation from that country was getting ready to participate in Russia in the 21st World Oil Congress. The timely announcement in advance lent weight to the expectations – foreseeable due to previous events – regarding the presentation of Cuba’s plans at the congress, held in Krokus City, on the outskirts of Moscow, June 14-19.
The head of the Cupet Prospecting Group, Rafael Tenreyro, one of the envoys to the Russian capital, announced in a press conference during the first week of June that Cuba would incorporate maritime sectors located to the north of the central and eastern regions of the country to the foreign capital investment options in oil prospecting.
He added to the promise of expanding that information during the Moscow global meeting that they would take in their portfolio the new Law on Foreign Investment, approved last March by the Cuban Parliament with the aim of making more attractive the possibility of associations with firms from other countries.
An internationally renowned expert, Manuel Marrero Faz, advisor to the Cuban energy and mines minister, said on that occasion that they were travelling to the World Oil Congress to hold bilateral talks with other companies, “without excluding any of them”.
The extensive area offered now to prospecting by foreign companies is added to the Cuban Exclusive Economic Zone in the Gulf of Mexico. A few years ago, four wells were drilled in deep waters in that region, to the northwest of the island of Cuba, with the participation of the semi-submergible Italian Scarabeo 9 oil rig, hired by third country companies. The first results were not encouraging, despite the fact that the geological studies support the existence of a great potential.
The U.S. Geological Service estimates that the Cuban area of the Gulf of Mexico stores around 4.6 billion barrels of oil and 9.8 trillion cubic metres of natural gas, while Cupet’s studies calculate reserves that are four or five times higher.
Recent data indicate that Cuba produces an annual average of 21 million barrels of oil (close to 60,000 barrels a day) and 1.1 million cubic metres of natural gas on land and offshore. With that production it covers almost half of its consumption of hydrocarbons. It purchases the rest, some 100,000 barrels a day, from Venezuela, with payment facilities.
Around 50 percent of the oil and natural gas consumed in Cuba is used for power generation.
A numerous public paid attention with interest to the options announced by Deputy Minister of Energy and Mines Rubén Cid, head of the Cuban delegation, expanded by Marrero Faz and Tenreyro. Some 5,000 companies and experts from more than 80 countries attended the World Oil Congress, as well as ministers from the energy and oil sector from around 30 countries.
The expectations gained weight due to the important steps taken by Cuba this year. Two of the principal Russian oil corporations, Rosneft and Zarubezhneft, signed in May, in Saint Petersburg, two cooperation agreements with their counterpart Cupet to strengthen the energy alliance begun some years ago. In addition to oil prospecting, the agreements include the creation in the Mariel Special Development Zone a Rosneft logistics base. This company is endorsed with being the world’s largest oil company according to number of barrels extracted.
The year began with other important announcements by Cupet: the drilling of 10 wells on coastal areas of western Cuba, where the country’s most productive deposits are located. Outstanding among the projects is the drilling of an 8,200-metre-long well toward the sea. Horizontally drilled, in the extended reach modality, it will be the longest drilled in the Cuban archipelago.
But, judging by the most recent movements, the Cuban oil sector has set its sights even farther away. “All our deposits are in the sea and are reached through horizontal drilling, but the idea is to go beyond and we have the potential for that,” Tenreyro told the press before leaving for Moscow.
Early this year he had already said that “with the current knowhow we could aspire to achieve long-term oil self-sufficiency, as long as consumption does not shoot up.”
Cupet is confident it will even find lighter oil deposits than the hydrocarbons usually extracted from its subsoil, though at a greater depth. Another alternative depends on the access to cutting-edge technologies to recover from the already discovered deposits greater amounts of oil than the technological options at the reach of Cuba today are able to obtain.
“If we take into account the major assessment elements of the oil potential,” Tenreyro said, “we could affirm that Cuba has all it needs for the development of that industry.”
If the experts’ forecasts were to come true, Cuba would gain an energy self-sufficiency which is so dear to it in its dreams of economic progress. (2014)
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