Friday, April 28, 2006

Nelson: Block Cuban oil drilling

Posted on Fri, Apr. 28, 2006

Nelson: Block Cuban oil drilling
Citing fears that Cuba plans to drop oil rigs near the coast of Key
West, Florida's Sen. Bill Nelson planned legislation that he says could
tie Fidel Castro's hands.

WASHINGTON - Throwing a grenade into the fight over oil drilling off
Florida's coastline, Sen. Bill Nelson plans to announce today
legislation that he says could prevent Cuba from drilling in its waters
some 50 miles off Key West.

The Florida Democrat says his bill would block President Bush from
renewing a 1977 international agreement that allows Cuba to conduct
commercial activity in waters off its coast, near the Keys -- unless the
administration secures an agreement to prevent Cuba from putting oil
rigs near Florida.

The legislation is likely to rile already testy U.S.-Cuban relations,
and it was unclear late Thursday how the United States might enforce a
ban on Cuban drilling for oil or natural gas in the Florida Straits if
the agreement lapsed. However, according to a draft of the bill obtained
by The Miami Herald, the legislation would seek to discourage foreign
oil companies from drilling near Cuba by imposing sanctions against them.

But the legislation may be a tough sell: Florida Republican Sen. Mel
Martinez, who has teamed up with Nelson to fend off efforts to open
Florida waters to offshore drilling by U.S. oil companies, said Thursday
he has ''some concerns'' about Nelson's proposal.

''Sen. Martinez's position is that this is a complex issue and it
requires thoughtful and thorough deliberation,'' Martinez spokesman Ken
Lundberg said, adding that Martinez has talked about ''potential
remedies'' to Cuban oil drilling with the State Department.

The effort to halt Cuban drilling comes as gas prices soar and a growing
number of members of Congress cite Fidel Castro's fledgling energy
exploration program as justification for drilling near Florida.


They include Rep. John Peterson, a Pennsylvania Republican who wants to
drill for natural gas within 20 miles of the U.S. coastline and who uses
the Castro argument to press his point. And Sen. Larry Craig, R-Idaho,
said this week he plans to introduce legislation that would allow U.S.
companies to drill near Cuba -- a provision that would require an
exception to the embargo that bans most trade with the island nation.

Kirby Jones, president of the U.S.-Cuba Trade Association -- which
promotes trade with Cuba and organized a February energy conference
between Cuban government officials and U.S. companies interested in
exploring Cuban waters -- predicted the Cuban government will scoff at
Nelson's efforts.

''They have an international treaty agreement that is signed. They have
a similar agreement with Mexico and it's existed for 29 years and
everyone has operated under those boundaries,'' Jones said. 'Nelson
coming along saying, `It's against the law for Cuba to do X, Y or Z in
its own waters?' The Cubans will laugh at us.''


Cuba, which does not have the technology to conduct offshore drilling,
has signed agreements with companies in several countries, including
Repsol in Spain, Sherritt International Corp. in Canada and the Chinese
energy giant Sinopac, to explore potential offshore oil and gas fields.

Some sectors come as close as 50 miles off Key West, and industry
analysts have suggested there are at least 1.6 billion barrels of
crude-oil reserves in the area. So far, the efforts have proved
disappointing but they continue.

Nelson and Martinez are pushing for a drilling boundary no closer than
150 miles from the Florida Panhandle and about 260 miles from its west
coast, arguing that drilling any closer to shore could imperil Florida's
tourist-dependent economy.

Nelson's legislation would look to dampen foreign enthusiasm for
drilling near Cuba by sanctioning executives of foreign oil companies.

According to the draft bill, the U.S. secretary of state could deny
visas to oil company executives, curbing their ability to conduct
business in the United States -- in a move patterned after the
Helms-Burton law that denies visas to executives of foreign companies
that invest in properties seized by Cuba after the 1959 revolution.

''It's Sen. Nelson's intention to do everything he can do to keep oil
rigs away from the coast of Florida,'' said Dan McLaughlin, a spokesman
for Nelson, who is running for reelection this year.

No comments: