Monday, February 25, 2008

Cuba oil production dropping, expert says

Cuba oil production dropping, expert says
Fri Feb 22, 2008 11:11pm GMT

MIAMI, Feb 22 (Reuters) - Cuba's oil production, which peaked at 65,000
barrels per day in 2003, has fallen to 51,300 bpd due to declining
output from the country's primary oil field, a Miami-based energy expert
said on Friday.

Jorge Pinon, a former oil company executive and now energy fellow at the
University of Miami, said the Varadero field, east of Havana, has been
depleted by years of pumping.

"Varadero field was discovered in the 1970s. This is a very old oilfield
and that field is going through its natural decline," Pinon said at
conference on Cuba at Florida International University.

Pinon said Sherritt International (S.TO: Quote, Profile, Research), a
Canadian joint venture partner with Cubapetroleo (Cupet), is planning to
use enhanced recovery methods to squeeze more oil from Varadero.

The 51,300 bpd average includes oil and liquids produced from natural
gas processing, he said. The latter accounts for 1,200 to 1,500 bpd, he

He said the cost of producing oil in Cuba is about $1.77 a barrel.

Pinon said Cuba consumes about 145,000 bpd, with 90,000 of that imported
from Venezuela.

(Reporting by Jeff Franks; Editing by David Gregorio)

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