Gazprom of Russia to Drill for Oil in Cuban Waters

Gazprom of Russia to Drill for Oil in Cuban Waters
By ANDREW E. KRAMER
Published: November 15, 2010

MOSCOW — The Russian energy giant Gazprom has joined a growing list of
companies that plan to drill for oil in the waters off Cuba, close to
the United States but out of reach of its safety regulators.

Cuba produces little oil now, but petroleum experts say the country's
northern coastal waters could hold plentiful reserves, which could help
revive the island's economy and ease its dependence on oil imported from
Venezuela. Half a dozen companies have signed deals to work as close as
50 miles off the United States coast, but none from the United States
because of the 48-year-old trade embargo.

The oil arm of Gazprom, Gazprom Neft, bought a 30 percent share of four
exploration blocks from the Malaysian state-owned company Petronas,
Gazprom Neft said in a statement.

Under the agreement, the Russian company will also assume a role in
operating offshore drilling platforms. Russian oil firms, which operate
mostly on land in Siberia, have little expertise offshore and have
sought to form partnerships to gain experience.

Gazprom is buying into an exploration deal Petronas reached with the
Cuban government in 2007. Work has already begun. After some seismic
work, engineers decided to start drilling next year.

If hydrocarbons are found, the leases that now belong partly to Gazprom,
pending approval by the Cuban authorities, extend through 2037 for oil
and 2042 for natural gas.

As Cuba has made plans to drill for oil in the Gulf, concern has risen
in Florida.

Ocean scientists warn that a well blowout at a site where a Spanish
company, Repsol, intends to drill next year could send oil spewing onto
Cuban beaches and then the Florida Keys in as little as three days.
Repsol has contracted with an Italian operator to build a rig made in
China for the deep-water well about 50 miles from the coast of the
United States.

Cuba lacks the underwater robots and spare drilling rigs that would be
needed to contain a big spill, while the trade embargo could complicate
assistance by United States companies.

Other companies, from Norway, India, Venezuela, Vietnam and Brazil, have
also taken exploration leases in Cuba.

https://www.nytimes.com/2010/11/16/business/global/16oil.html?partner=rss&emc=rss