Jane Van Ryan
Posted October 6, 2010
Cuba appears to be preparing for an oil boom just south of the Florida coast.
According to newspaper articles and government reports, state-owned oil companies from several countries are interested in drilling in the island nation's territorial waters. The Wall Street Journal reports that Spanish-owned Repsol is planning to drill several wells about 50 miles from the Florida Keys next year. The Miami Herald says a rig will drill in about 5,600 feet of water about 22 miles north of Havana, and about 65 miles south of Florida's Marquesa Keys.
Cuba's northern waters could have significant undiscovered oil resources. According to the U.S. Geological Survey (USGS), an estimated 4.6 billion barrels of oil could exist in the North Cuba Basin, and another 15 billion barrels could lie beneath other Cuban territorial waters. While there's little doubt that oil discoveries could be a boon to Cuba's economy and lessen its dependence on Venezuelan oil imports, many observers are concerned about U.S. policies that prohibit U.S. company involvement.
They say the U.S. trade embargo against Cuba not only allows other countries to tap into oil that's close to home, but also it prevents U.S. technology from being used if a spill were to occur. Vessels containing more than 10 percent U.S. parts are not allowed to operate in Cuba. As the Miami Herald reports, Repsol is using an Italian rig with a crew of 200 to drill off Cuba's coast. If a blowout were to occur, Repsol likely would need to bring in spill-response equipment from other parts of the world, perhaps the North Sea. The response delay could pose significant problems for the U.S. coastline.
In the meantime, U.S. drilling rigs and crews--with their superior technologies and knowledge of the Gulf--have been idled due to the administration's moratorium on drilling in more than 500 feet and the new drilling requirements. As Jim Hoft at Gateway Pundit points out, the moratorium is expected to cost more than 20,000 U.S. jobs, while Cuba and its foreign partners tap in the Gulf's energy resources.
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