Aussie oil company gushing over Cuba
MEO Australia said early groundwork in opening Cuba paying off.
By Daniel J. Graeber | Updated Feb. 9, 2016 at 10:43
MELBOURNE, Feb. 9 (UPI) — The lower cost of operating in the Cuban oil
sector and improving Western diplomatic ties means good things for early
movers, an Australian company said.
Independent oil company MEO Australia said a number of the wells drilled
near the coast of Cuba in so-called Block 9 have recovered oil.
Information gleaned from data from Block 9 gave the company confidence
about the potential for significant prospects onshore Cuba.
CEO Peter Stickland said the area is the company’s highest priority
asset. Data received so far suggests the area is rich in petroleum, with
early 2016 representing a watershed moment for onshore Cuba.
“The low operating costs in the Cuba support strong profitability levels
even in depressed oil price conditions and the improving diplomatic
relations with the U.S. is expected to drive substantial foreign
investment over the coming years,” he said in a statement.
The Cuban government in 2014 enacted legislation offering corporate tax
credits to encourage foreign investments. The U.S. government the same
year started easing a 54-year trade embargo on Cuba and later reopened
its embassy in Havana.
According to MEO, Cuba produces about 80,000 barrels of oil per day.
Canada’s Sherritt International, the only foreign company producing in
Cuba, estimates operating costs of around $9 per barrel.
Estimates from the U.S. Geological Survey last year found there were
about 4.6 billion barrels of crude oil and 9.8 trillion cubic feet of
natural gas in the form of undiscovered, technically recoverable,
reserves in Cuba. About three quarters of that is said to be located
within 50 miles from shore.
“Interest in investing in the oil industry in Cuba continues to grow,”
Source: MEO Australia upbeat on Cuban oil prospects – UPI.com –