April 16, 2008 / 1:49 PM / 11 years ago

Cuban off-shore oil drilling put off until 2009

HAVANA, April 16 (Reuters) - Cuba’s minister of basic industry said plans by a consortium of companies to drill in Cuba’s Gulf of Mexico waters this year have been rescheduled for 2009, the country’s state-run media said on Wednesday.

“In the Gulf of Mexico we are doing seismic studies and our perspective is we should resume drilling in the area next year,” Basic Industry Minister Yadira Garcia was quoted by the official Juventud Rebelde newspaper as stating.

Garcia said last year that drilling by a consortium led by Repsol-YPF (REP.MC) of Spain would begin in 2008, if a rig could be rented.

Interest in Cuba’s Gulf of Mexico blocks picked up after Repsol discovered a small deposit of light oil in 2004 that was not commercially viable.

Repsol has since joined forces with Norsk Hydro (NHY.OL) and ONGC Videsh (ONGC.BO) of India.

Seven foreign companies have signed exploration agreements with Cuban state oil company CUPET for 28 of the 59 blocks available in the deep Gulf of Mexico waters of Cuba’s economic exclusion zone fronting the United States.

The director of exploration for CUPET said this week activity was picking up in Cuba’s deep waters.

“Right now seismic studies are under way on 2,300 square kilometers and very soon three-dimensional studies will begin on 4,500 square kilometers in the Gulf of Mexico,” Rafael Tenreyro said.

The Repsol well was the first to be drilled in the area since Fidel Castro’s 1959 revolution.

The U.S. Geological Survey estimated the North Cuba basin could contain 4.6 billion barrels of oil, with a high-end potential of 9.3 billion barrels, and close to 1 trillion cubic feet of natural gas.

Garcia said U.S. companies were interested in exploration, but were barred under trade sanctions enforced in 1962 against the island’s Communist government.

“There have been meetings with businessmen asking questions and looking for information ... They have had an interest in acting in Cuba,” she said.

In addition to Repsol-YPF, ONGC and Nordsk Hydro, Venezuelan state oil company PDVSA, Vietnam state oil and gas group Petrovietnam, Malaysia’s state-run Petronas [PETR.UL] and Canada’s Sherritt International (S.TO) have taken blocks in the area. Brazil’s Petrobras (PETR4.SA) said in January it was considering taking out blocks in Cuban deep water.

Cuba produces the equivalent in oil and gas of 75,000 barrels per day, around 50 percent of its energy needs, importing the remainder from oil-rich ally Venezuela on preferential terms in exchange for health, education and other services. (Reporting by Marc Frank; Editing by Walter Bagley)

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