Russia's oil giant, Zarubezhneft, has finally joined 6 other foreign oil companies in abandoning their plans to drill off of Cuba's northern coast. Zarubezhneft was the last to pull out of the island nation's only active drilling project dashing it's quest for black gold.
One problem the companies have encountered is very hard rock, which quickly wears down drilling bits and is so dense that oil does not easily flow through it. Though there is oil it can not with current technology be produced.
The Moscow Times explains:
The Russians' plan to drill 6,500 meters below the sea floor and hopefully find oil appears to have been derailed by difficult geology, the same issue that others have encountered in Cuban waters, as well as problems with its rig, the Songa Mercur, which at one point lost its blowout preventer.
Taking into consideration geological complications, Zarubezhneft and (Cuban state oil company) Cubapetroleo have jointly decided to make changes in the initial drilling program by dividing it into two stages," the company said at the end of last month.
"The second stage of exploration work on Block L is due to be launched in 2014," it said, declining to comment further. The well, begun five months ago, was in shallow water about 320 kilometers east of Havana, near the popular tourist destination Cayo Santa Maria.
The premature end of the Zarubezhneft well was not totally unexpected because Songa Offshore, owner of the Songa Mercur, earlier said the rig would leave by June 1 for a project in Southeast Asia. It had originally been scheduled to stay in Cuba until July 1.
There was a Russian press report that the rig would come back for another attempt by Zarubezhneft, but Songa Offshore Chairman Jens Wilhelmsen said the report was "completely without foundation."
"We have not made any agreement that Mercur will return and we have not received any inquiries from Zarubezhneft that they want it back," he said. "So I can just deny that Mercur will return."
These exploratory drill sites were all close to areas where the Obama administration blocked U.S. drilling in the eastern Gulf of Mexico after BP's massive Deepwater Horizon oil spill.
National Geographic explored the Scarabeo 9 on this very issue.
There's perhaps no better symbol of the complexity of Cuba's energy chase than the Scarabeo 9, the $750 million rig that spent much of this year plumbing the depths of the Straits of Florida and Gulf of Mexico. It is the only deepwater platform in the world that can drill in Cuban waters without running afoul of U.S. sanctions. It was no easy feat to outfit the rig with fewer than 10 percent U.S. parts, given the dominance of U.S. technology in the ultra-deepwater industry. By some reports, only the Scarabeo 9's blowout preventer was made in the United States.
Owned by the Italian firm Saipem, built in China, and outfitted in Singapore, Scarabeo 9 was shipped to Cuba's coast at great cost. "They had to drag a rig from the other side of the world," said Jonathan Benjamin-Alvarado, a University of Nebraska professor and expert on Cuba's oil industry. "It made the wells incredibly expensive to drill."
Leasing the semisubmersible platform at an estimated cost of $500,000 a day, three separate companies from three separate nations took their turns at drilling for Cuba. In May, Spanish company Repsol sank a well that turned out to be nonviable. Over the summer, Malaysia's Petronas took its turn, with equally disappointing results. Last up was state-owned Petróleos de Venezuela (PDVSA); on November 2, Granma, the Cuban national Communist Party daily newspaper, reported that effort also was unsuccessful.
It's not unusual to hit dry holes in drilling, but the approach in offshore Cuba was shaped by uniquely political circumstances. Benjamin-Alvarado points out that some of the areas drilled did turn up oil. But rather than shift nearby to find productive—if not hugely lucrative—sites, each new company dragged the rig to an entirely different area off Cuba. It's as if the companies were only going for the "big home runs" to justify the cost of drilling, he said. "The embargo had a profound impact on Cuba's efforts to find oil."
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All is not great news in Cuba as Norway's Statoil is leering after Cuba's Caribbean side for oil deposits.
A Cubapetroleo map on display at a recent geosciences conference in Havana indicated that as of last November, Cuba was in negotiations with the Norwegian oil giant to lease three large blocks along the central and southeastern coast, between the archipelago of the Gardens of the Queen and the coast in the Gulf of Ana Maria and the Gulf of Guacanayabo.
Statoil does not comment on pending projects, but industry sources said it may just be sniffing around — as it does all over the world looking for oil prospects — and that its level of interest remains to be seen. The company has not mentioned Cuba in its drilling plans for the next two years.
It is likely also mindful of the sensitivity and potential dangers of drilling near the Garden of the Queens, which is regarded as one of the world's most pristine coral reefs and whose preservation as such has become a cause for international environmental groups.
In researching this diary I did uncover a interesting fact about our former Vice-President. He along with George Will lied to the country, shock I know, about China drilling in Cuban waters. The lie, of course, was part of their effort to push more domestic drilling in sensitive areas in this country such as the GoM, the Outer Banks and the Arctic National Wildlife Refuge. Cheney was forced to retract his lie due to criticism. All of this went past my radar.
Think progress has the sorry mess documented here.
On Wednesday, Vice President Dick Cheney gave a speech to the Chamber of Commerce in which he claimed that China, in cooperation with the Cuban government, is drilling for oil “60 miles off the coast of Florida.” “Even the communists have figured out” that drilling for oil is the solution to the energy crisis, Cheney argued.
It’s a talking point favored by the right wing. Cheney was quoting conservative columnist Geroge Will, who wrote on June 6 that China is drilling “60 miles off Florida,” “closer to South Florida than U.S. companies are.” The same day Cheney spoke, Rep. Roy Blunt (R-MO) wrote that Castro was allowing drilling “45 miles from the Florida keys.” Rep. George Radanovich (R-CA) and House Minority Leader John Boehner (R-OH) have also raised the specter of Chinese drilling just off U.S. shores.
The problem, of course, is that the claim is completely false. After his claim was thoroughly debunked in the press, Cheney acknowledged that he had, in fact, lied in his speech, though his statement today offered no apology and issued only a half-hearted backtrack of his original claim:
It is our understanding that, although Cuba has leased out exploration blocks 60 miles off the coast of southern Florida, which is closer than American firms are allowed to operate in that area, no Chinese firm is drilling there.
Cheney’s comments were so egregiously false that a member of his own party took to the Senate floor to correct the record. Sen. Mel Martinez (R-FL) decried claims of “some fabricated Cuba/China connection,” saying they have “no merit.”