Oil in Cuba: Flammable material?

By Jesús Arboleya Cervera

According to the U.S. Geological Survey (USGS), Cuba has an oil reserve of 5 billion barrels in the vicinity of the northwestern coast and approximately 10 billion more in the Gulf of Mexico belonging to the country. Although Cuban sources estimate these stocks to be much higher, the USGS estimate alone would be enough to comparatively represent three times the proven reserves of countries like Colombia and Argentina.

In both fields the participation of transnational oil companies is very high, as required by the technological complexity and the large investments required for these jobs, especially in the deep waters of the Gulf, which has been divided into 59 lots. Twenty-one of them are explored by major companies that have signed contracts guaranteeing the Cuban state 60 percent of whatever they can extract.

Given these prospects, experts believe that within three to five years in Cuba would be able to achieve self-sufficiency in oil, in addition to large investments in infrastructure and new refineries, which would put the country in a position to export refined oil to the whole region, including the United States.

Such possibilities open a very encouraging economic perspective, since the importation of fuel currently consumes more than half the value of imports, its price tends to increase and supplies are subject to uncertainties of every kind, particularly in the case of Cuba, which is very sensitive to shifts in international politics.

Now then, oil exploitation also involves risks and responsibilities that Cuba will face in the near future, bringing the problem to the status of an issue that affects national security in several ways.

Although 50 years of confrontation with the U.S. and surviving the end of the European socialist bloc have demonstrated the ability of the Cuban State to face monumental problems in order to preserve the sovereignty of the nation, dealing with the large multinational oil companies is not a panacea for any Third World country.

Although the Cuban policy has been to diversify the investments with a view to reducing dependency, ultimately we are dealing with a global monopoly control able to exert brutal pressure on national policies.

Then there’s the environmental problems involved in oil exploration, always prone to accidents, as evidenced by BP’s recent spill in the Gulf of Mexico. This incident has raised alarm around the world and has prompted U.S. experts to emphasize the need to find formulas to cooperate with Cuba, as a way to enhance the mutual security of these operations.

At the invitation of Cuba, after failed attempts to get a license from the State Department in 2009, a delegation of the International Association of Drilling Contractors (IADC), which represents 90 percent of the drilling companies in the world, visited the island late last year.

Lee Hunt, its president, told The New York Times at the time that the Cubans were aware of the importance of safety in the drilling and had incorporated many of the internationally adopted principles in their plans.

However, he stressed the importance for the very security of the United States for Cuba to have access to specialized U.S. technology and personnel and demanded a change in the policy of that government with a view to facilitate such access.

Cuban American Jorge Piñón, a former president of Amoco Corporation for Latin America and currently visiting professor at Florida International University, said pretty much the same at an event organized by the Brookings Institution, where he received the support of a wide range of oil experts, environmentalists, lawyers and political scientists.

Piñón emphasized that it was not enough to be flexible when issuing licenses, as proposed by the Department of State, since no one can calculate the nature and needs of an accident of this nature, where timing is critical.

Even the bipartisan commission appointed by President Obama to investigate the BP disaster, presided by Republican William Reilly, former director of the Environmental Protection Agency, and Democrat Bob Graham, former Senator and Governor of Florida, recommended a search for some accord that involved the governments of Cuba, Mexico and the United States.

Added to the logic of environmental protection is the more subtle but no less influential interest in the business of U.S. oil companies, distanced from these projects due to the blockade, as well as that country’s strategic interest in diversifying its energy sources.

So far, voices of sanity have been heard, but it would be enough for one cowboy to pull out his revolver to start a shootout. Therein lies the threat implied by the recent initiatives of Representative Vern Buchanan (R-Fla.), a man with a record of crimes and irregularities, who has been nominated for several consecutive years by Citizens for Responsibility and Ethics in Washington (CREW) as one of the 20 most corrupt politicians in Congress.

Although at first sight his proposal to punish foreign companies that participate in the exploitation of Cuban oil has had little acceptance among his colleagues (except the usual ones) and although logic indicates that starting a worldwide oil war is not in the interests of the United States, nobody knows if Mr. Buchanan has been hired by Halliburton or some other company in the American “axis of evil” to strike the match that will set fire to the bushes.

In sum, this confirms that oil is a very flammable manner and having it in abundance today constitutes a great danger not only for the fish and the coral reefs…