Sherritt doesn’t stop and Cuba lifts off

All of the Cuban newspapers today, June 7, are reporting that the nation's acting President, Army Gen. Raúl Castro Ruz, attended "the start-up of two new electrical generation units" in eastern Cuba. 

At the same time, international news services report that the Canadian company Sherritt International will invest about $1.25 billion in the island in the next two years. 

What's the connection between the two news items? Well, the two new units for power generation were built and put into service by the joint enterprise ENERGAS, composed of Sherritt and the Cuban state companies CubaPetróleo (CUPET) and Unión Eléctrica.

The two new units, which together generate 70 megawatts, have raised to 495 MW the power produced by natural gas, a byproduct of oil, a production that should have been generated by "the first thermonuclear reactor at Cienfuegos, which was 440 MW," said Vice President Carlos Lage in his speech inaugurating the two units. The Cienfuegos plant remained unfinished when the Soviet Union ceased to exist.

 

At present, 13 percent of the electricity produced by Cuba comes from gas, but, according to Lage, this modality will grow by an additional 125 MW, thanks to the contract signed on June 6 with ENERGAS. "Within two years, we shall have 620 MM" generated by gas, Lage added.

 

Oil-produced gas used to be lost in the atmosphere, causing environmental damage. From the economic point of view, natural gas is very low in cost.

 

Cuba's gas reserves are estimated at 12 trillion to 13 trillion cubic meters, and Sherritt and ENERGAS are deeply involved in the exploitation of this resource.

 

At present, Cuba's daily production of gas is 3 million, 450 thousand cubic meters, from which 335,000 are distributed through networks to about one million people who cook with gas.

 

Cuba, which in August 2004 was at the edge of a social explosion because of the interruptions of electrical service, tackled the problem with energy and political will, to the point that today it has an installed operating capacity of 3,400 MW, whereas, according to Lage, "the maximum demand is 2,500 MW."

 

Ian Delaney, president of Sherritt International, said at the inauguration ceremony that "These are the most modern installations in the world, and we hope to build many more of this type. In fact, what we are celebrating today is the first phase of this installation project."

 

Delaney, whose company is already exploiting and trading in Cuban oil and has large investments in nickel production, said Sherritt "is a proud participant in the development of Cuba. Our company's commitments of expansion and investment for the next several years include the investment of $1.25 billion. That means the continuation and expansion of our business in nickel, electricty, oil, and gas."

 

What happened yesterday in Boca de Jaruco, east of Havana, can be interpreted very clearly. First, the country has solved the basic problem of the "apagones," or blackouts. That solution is the corner stone of the so-called energy revolution.

 

A second aspect is that Cuba's relations with Sherritt as partners have been extremely beneficial to solve that crisis. This confirms the role of private foreign investment in key sectors, such as energy, and should serve as an incentive to other companies to follow an example that has borne fruit for everyone. This example is being imitated by oil companies from different countries, such as Spain, Norway, India, China, Venezuela and Brazil, just to cite a few examples.

 

And the final aspect is inevitable. Just 90 miles from the United States, Cuba has gas reserves, but the political clumsiness of the Bush administration, which clings stubbornly to the blockade as a means to topple the Revolution, prevents U.S. entrepreneurs from making profits in exchange for low production costs. Besides, the blockade is useless, because the Cubans have found ways around it and are staying afloat in strategic areas.

 

Taken from Progresoblog.com/espanol.