Drilling: U.S. Embargo May Hinder Oil-Spill Response in Cuban Waters

Platts – A long-standing embargo imposed by the United States on Cuba could make it more difficult to clean up potential oil spills as the Caribbean nation prepares to drill in deep water 50 miles from the shores of Florida, according to the head of an international drilling trade group. Lee Hunt, the president of the International Association of Drilling Contractors (IADC), made his comments to Platts Energy Week (http://www.plattsenergyweektv.com/), the independent, all-energy television news and talk program airing Sundays in the United States.

Hunt said that the U.S. embargo on Havana has required drillers there to use second-hand equipment to avoid buying it from U.S. companies. “The impact of the embargo has to do if something goes wrong, and what kind of resources can be mobilized to cap or stem the flow of a runaway well or to contain a spill.”

Cuba has been a target of a U.S. embargo since 1962. A subsequent U.S. law allows foreign companies working with Cuba to use only 10% U.S.-made equipment, or face sanctions on their operations in the United States.

Spanish-owned Repsol plans deepwater drilling off the Cuban coast later this year using a drilling rig built in China specifically to avoid the embargo.

“What the contractor has had to do is shop around its used inventory to locate a piece of equipment that falls outside the restrictions of the embargo, so the embargo, in effect has forced the drilling contractors working in Cuba to go to second-level equipment,” Hunt said.

Hunt’s comments come a little more than one year after the anniversary of the 2010 Macondo well blowout in the Gulf of Mexico resulted in the worst oil spill in U.S. history.  A report from the Interior Department found that human failure was the primary cause of the disaster, but that a malfunctioning blowout preventer was a major contributing factor to the magnitude of the spill.

“It is unnerving that as we work here in the Gulf of Mexico with the Department of Interior and the [Bureau of Ocean Energy Management, Regulation and Enforcement] that as we seek the gold-plated standard for the United States, the impact of the embargo is to force our neighbor, drilling very, very close to our shores, to go into a secondary market for parts, service and supply.”

Cuban officials have been very supportive of drilling safety, Hunt said. “What we are hearing from Cuban officials is a great deal of respect for the various regulatory schemes in the world, and in particular the new ones emerging in the U.S.,” Hunt said. ‘They are attempting to follow what can be communicated as best practices.”

The interview with Hunt was shortly before the U.S. announced it would allow the Cuban officials to attend a conference in Trinidad next month sponsored by the U.S.-based IADC to discuss Cuba’s deepwater drilling plans. Permission from the United Sates was required because IADC is a U.S. group and the embargo prohibits U.S. citizens from meeting with Cuban officials. The full interview may be accessed here.

As plans for deepwater drilling ramp up off the Cuban coast, the presence of a delegation from Havana including the country’s top drilling regulator would mark the first time they have discussed that drilling in an international forum. The IADC hopes to use the forum to discuss international best practices with Cuban officials.

In a segment entitled Iraq Plays Catch-up on Oil, Platts Baghdad-based correspondent Ben Lando reported on Iraq’s race to rebuild its oil infrastructure and play a bigger role in oil and natural as markets.

In this week’s Energy Watch segment, Platts Energy Week featured Devon Energy’s William Whitsitt, executive vice president for public affairs, on the topic of a new national database on fluids used in shale gas drilling. Whitsitt spoke about his company’s participation in a new voluntary database. Platts Gas Daily Associate Editor Bill Holland offered an update on the latest developments in the Marcellus Formation, the rich shale gas region that stretches from New York to West Virginia.

Original Article

Posted on May 4, 2011, in Caribbean Sea, Cuba, Natural Gas and tagged , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink. Comments Off on Drilling: U.S. Embargo May Hinder Oil-Spill Response in Cuban Waters.

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