Cuba’s offshore drilling? Not so fast!
Spanish company Repsol (yes, the same one whose subsidiary got ripped off by Argentina’s Cristina Fernández) went digging for offshore oil off Cuba and came up … empty:
Oil well in Cuba comes up dry, raises questions about future exploration
After reporting that it found no oil in its well in Cuba, Repsol will likely now consider leaving the country.
Cuba’s dreams of an oil bonanza suffered a tough but possibly temporary setback Friday when the Spanish Repsol company confirmed it hit a dry hole when it drilled a well off the island’s northwest coast.
The dry well will put more pressure on Cuba’s dependence on Venezuelan oil and means the government of Raúl Castro needs to continue nurturing its tight relations with the ailing president of Venezuela, Hugo Chávez, one analyst said.
The development also may temporarily allay fears of an oil spill in Cuban waters that could foul the Florida Keys and the U.S. eastern seaboard, although several other foreign oil companies have options to explore in Cuban waters and Repsol had contracted to drill a second exploratory well.
Repsol spokesman in Kristian Rix confirmed to journalists in Havana Friday that the Scarabeo-9 floating drill platform found nothing in a well in more than 6,000 feet of water about 20 miles northwest of Havana. The well will be capped, he added.
The announcement was a tough blow to Cuba’s hopes for finding crude that could fuel its anemic economy.
Jorge Piñon, a University of Texas oil expert who keeps an eye on Cuba, said the dry hole was not surprising because such things can happen, yet surprising because modern technology has significantly increased the chances of hitting oil.
A key question now, Piñon added, is whether Repsol, already battered by the Argentine government’s nationalization of its YPF branch earlier this month, will decide to cut its risks and leave Cuba for more productive areas.
Leave for more productive areas that respect the rule of law and property rights, guys.