The Current State Of Cuba's Offshore Oil Development

While Cuba produces some energy - principally heavy oil and associated natural gas - its domestic production does not meet its requirements for daily energy consumption. Once dependent on the Soviet Union for energy imports, Cuba now relies on Venezuela for oil to keep its economy afloat. According to experts, Cuba's arrangement with Venezuela is unsustainable over the long-term.

The U.S. Geological Survey estimates that offshore reserves in the North Cuba Basin could contain an additional five billion barrels of undiscovered technically recoverable crude oil. Cuba estimates its reserves in 20 billion barrels. However, all exploratory results have been a blow to Cuban hopes of finding oil. Some attempts came up dry or resulted in the discovery of a field devoid of commercial value.

Now, Cuba is asking for Russia's help with the support of President Putin. Russian companies Rosneft and Zarubezhneft signed an energy agreement with Cuba in May 2014 to explore offshore oil deposits. The drilling area north of Havana straddles the Gulf Stream, a powerful ocean current that rushes north to the Florida coast. Oceanographers warn that an oil slick caused by a major spill could reach Florida's beaches, reefs and marine sanctuaries in about a week.

Former U.S. Senator Bob Graham, who also served two terms as governor of Florida and co-chaired a presidential commission on the 2010 Deepwater Horizon oil spill in the Gulf of Mexico, met with Cuban officials in January 2014. Senator Graham and energy experts said the Russians have little experience with deep-water drilling and that the U.S. embargo of Cuba prohibits the use of American technology to prevent or respond to a spill.

A State Department spokesperson said U.S. officials "have expressed our concerns" to Cuba and its partners, but the United States can do nothing to stop drilling in Cuban waters. While the embargo limits the use of American products, U.S. companies...

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