Impending deepwater drilling offshore Cuba heightens environmental awareness

Clear blue sky. Turquoise ocean. Pristine beach. Will this picture of the Gulf of Mexico (GOM) be the same a generation from now?

“One Gulf,” the theme of the 2011 IADC Environmental Conference & Exhibition held in Port of Spain, Trinidad, 12-13 May, embodied such a vision through open communication among countries adjacent to the GOM. With representatives from the US, Cuba, Trinidad and Tobago and the Bahamas in attendance, the conference provided a forum to share information about the environmental aspects of oil and gas exploration and development in GOM Exclusive Economic Zones (EEZs).

“This is a particularly interesting intersection of oil exploration and development and politics,” Dr Lee Hunt, IADC president, said. “(The Cubans) have been waiting all this time for floating deepwater technology in order to exploit reserves under their EEZ.”

Three economic zones, subject to international treaty, exist within the GOM — one belonging to the US, another to Cuba and the third to Mexico. The US zone is regulated by the Bureau of Ocean Energy Management, Regulation and Enforcement; the Cuban zone falls under the authority of the Office of Nuclear Safety and Environmental Regulation. Mexico and the US have worked out an agreement, the MexUS agreement, which establishes standard operational procedures to coordinate bilateral responses to pollution incidents when both countries agree.

Having drilled one deepwater exploratory well a couple of years ago, Cuba has announced plans to commence deepwater drilling operations later this year. Approximately seven wells are expected to be drilled in this phase. The first well that is anticipated to have commercial production will be carried out by Repsol, with ONGC, Statoil and Cubapetroleo, the Cuban national oil company, as partners.

“There is a huge potential in upstream oil and gas particularly if this first exploratory phase is successful,” professor Jorge Pinon of Florida International University said during a “One Gulf” panel session during the conference. “If Cuba had access to the technology, investment and capabilities that they need, Cuba could increase its recovery factor (from less than 10%) to 17-20%. Cuba’s current capacity could certainly increase (from 50,000 bpd) to 100,000 bpd.”

Saipem’s sixth-generation ultra-deepwater semisubmersible, the Scarabeo 9, will drill all of the planned wells. The Frigstad D90 unit is capable of working in up to 12,000-ft water depth and drilling to 50,000 ft. The Scarabeo 9 was specifically constructed to comply with the US’ half-century old economic blockade against trade with Cuba stating that any manufactured product sold into Cuba can have a maximum 10% American content. On the Scarabeo 9, the blowout preventer was one of the critical components of that 10%. The rig also has accommodations for up to 200 workers.

Speakers at the IADC event represented the myriad disciplines associated with the oil and gas industry, along with environmental groups, scientists and academia. In addition to scientific facts about environmental factors in the GOM and comprehensive discussions on systems and procedures, take-away points included:

• Energy security is vitally important to Cuba, just as it is to the US, and Cuba has a recognized right to exploit the resources in its EEZ.

• Cuba has a healthy respect for clean energy and efficiency. Even before the oil hike of 2008, Cuba recognized their dependence on foreign oil and the burden that they would carry in the scenario of high oil prices. The country has realized conservation and optimization of the whole energy system.

• Cuba’s commitment to sustainability was not invented for this conference; the country has not rushed into oil and gas development. They began developing their environmental laws and policies in earnest back in the early 1990s and have taken a stepwise measured approach to getting it right. The Cuban energy sector has also adopted IADC HSE Case Guidelines for Mobile Offshore Drilling Units.

• There is a strong interest within the US and Cuba to proceed with energy development in the GOM in an environmentally conscious manner.

“IADC has done something that no one else has done, and that is to get people to talk outside of Cuba in a very constructive and serious way about how we can begin to work together,” Dan Whittle, senior attorney and director of the Cuba Program Environmental Defense Fund, said. “After today I think this constructive dialogue has to continue.”