http://www.havanatimes.org/?p=60134

January 20, 2012 |

Fernando Ravsberg

The fabrication of the platform is not the only assistance from Beijing. Chinese specialists have been working for years in Cuba on the extraction of oil. Photo: Raquel Perez

HAVANA TIMES, Jan 20 – A Chinese-built offshore oil drilling platform has arrived in Cuban waters and can be seen from the Havana seawall. It comes along with the Spanish company Repsol, which will be the first, but not only firm, doing exploratory drilling to confirm the accuracy of previous assessments.

Washington has already inspected the rig to verify that it meets international safety standards and complies with restrictions set by the US economic embargo, which limits the use of American components in the construction of all equipment sold to Havana.

This requirement multiplied the expenses necessary for the fabrication of the special platform for Cuba. But this didn’t stop Repsol. The firm is confident that it will turn up large deposits of oil and gas, which were even confirmed by the US Geological Survey.

The island has exclusive rights to 43,000 square miles of “Caribbean Economic Zone” seabed off its coast, which has been parceled into 59 blocks and leased to various oil companies interested in prospecting those areas – with each corporation assuming all of their own financial risks.

Probable reserves

According to a study by the US Geological Survey (USGS), the Cuban reserves in the Gulf region amount to 4.6 billion barrels of oil, 10 trillion cubic feet of natural gas and 0.9 billion barrels of liquid natural gas.

However, Cuban specialists say there is actually five times more than what the Americans recognize. Such figures whetted the appetites of several companies, which spent years doing surveys.

Any contract with Cuba is a risk since the oil companies will have to pay all oceanic prospecting costs from out of their own pockets. Nonetheless, should they discover oil and/or gas, they will be allowed to carry out the exploitation of the deposits and will become the owners of half those reserves.

The work in Cuban waters is complex, requiring drilling to a depth of 1,700 meters while confronting ocean currents that are as strong as the political storms that broke out in Miami when it was learned that Cuba would be pumping oil from the Florida Strait.

Accusations from Miami
The petrochemical complex built by Venezuela on the central coast of the island is an ideal investment for refining the oil that will come out of the Gulf.

The first reaction of the exiles was to issue an ultimatum to Repsol. Led by the Miami Republican representative, Cuban-American Ileana Ros-Lehtinen, 34 federal lawmakers demanded the firm walk away from the project.

They charged that the discovery of oil would only serve to “finance the repressive apparatus,” adding that the Cuban government was searching for “an economic lifeline” and accusing Repsol of being “a partner ready to rescue it.”

Rafael Arias, the director of the Cuba’s oil company, responded that this demonstrates the “extraterritoriality of the blockade, the existing prohibitions by the US Congress, and the pressure and blackmail exerted by the US administration to curtail or prevent other countries or companies from doing business with Cuba.”

Negotiations

Washington ultimately opted for dialogue and Repsol agreed to allow US technicians to inspect the platform. They boarded it while it was passing through Trinidad and Tobago, since Cuba wouldn’t allow them to do so within its territorial waters.

The inspectors gave their approval as the construction of the platform was designed to deal with the reluctance of the White House and Miami. The security protocols are American and less than 10 percent of the rig’s components are US-made, thereby respecting the constraints of economic embargo.

For its part, the Obama administration issued licenses to US agencies to “deploy oil clean-up machinery, dispersants, pumps and other equipment and supplies needed to minimize environmental damage in the event of a spill.”

The economic zone gives Cuba a monopoly on the exploitation of oil under 43,000 square miles of water in the Gulf. Photo: Raquel Perez

Thanks to these licenses, specialized companies could reach the area within a few hours to combat a spill if there were an accident similar to the one suffered by the US two years ago from a British platform operating in the Gulf of Mexico.

The consequences

The Cuban authorities are giving a low profile to the subject in the press. Apparently, they don’t want to increase pressure on President Obama, who so far has handled the issue with a great deal of pragmatism.

Nor are the island’s officials interested in generating too many internal expectations. As one government official explained to me, “You know how it is, if we say we’ve discovered oil, lots of people are going to think there’s no reason for them to work and no need to save.”

Certainly, the discovery of important oil and gas reserves can completely change the Cuban scenario. A report from the Spanish Embassy said, “Favorable consequences for Cuba would begin to be felt from that very moment and could be powerful.”

Such finds could even change relations with the US, which would find it difficult to accept being sidelined without a piece of the pie, especially with regard to gas reserves that could reduce energy costs in some southern states. The sole obstacle is the economic embargo.

–
An authorized translation by Havana Times from the Spanish original published by Cartas Desde Cuba.
Special thanks to Richard Charter

http://www.tampabay.com/incoming/cuba-set-to-explore-offshore-as-oil-rig-arrives/1211509

Associated Press
In Print: Friday, January 20, 2012

HAVANA – A huge drilling rig arrived Thursday in the gulf waters north of Havana, where it will sink an exploratory well deep into the seabed, launching Cuba’s dreams of striking it rich with offshore oil.

The Scarabeo-9 platform was visible from Havana’s seawall as it chugged westward toward its final drill site about 30 miles from the capital, and 60 miles south of Key West.

Spanish oil company Repsol RPF, which is leasing the rig for about $500,000 a day, said it expects to begin drilling within days to find out whether the reserves are as rich as predicted.

It has been a long, strange journey for the Scarabeo-9, Repsol and Cuba, a process shadowed at every step by warnings of a possible environmental debacle and decades of bad blood between Cuba and the United States.

The U.S. trade embargo essentially bars U.S. companies from doing oil business with Cuba and threatens sanctions against foreign companies if they don’t follow its restrictions.

To avoid sanctions, Repsol chose the Scarabeo-9, a 380-foot-long behemoth built in China and Singapore and capable of housing 200 workers..

The Scarabeo-9’s blowout preventer, a key piece of machinery that failed in the 2010 Macondo-Deepwater Horizon disaster, is state of the art.

Judge pares lawyer fees in BP case: A federal judge has ruled that people pursuing their Gulf of Mexico oil spill claims against BP outside of federal court do not have to pay fees to hundreds of lawyers working on behalf of about 120,000 claimants fighting the oil giant in court.

U.S. District Judge Carl Barbier in New Orleans issued the ruling Wednesday to clarify a previous ruling.

Separately, federal lawyers on Thursday asked Barbier to find BP, Anadarko Exploration & Production LP and Transcoean Ltd. all liable for the April 20, 2010, spill before a Feb. 27 trial starts. BP and Anadarko jointly owned the well and Transocean owned the drilling rig that exploded, killing 11 workers.

Special thanks to Richard Charter

http://thehill.com/blogs/e2-wire/e2-wire/204621-obamas-jobs-council-calls-for-expanded-drilling

By Andrew Restuccia – 01/17/12 03:43 PM ET

President Obama’s jobs council called Tuesday for an “all-in approach” to energy policy that includes expanded oil-and-gas drilling as well as expediting energy projects like pipelines.

“[W]e should allow more access to oil, natural gas and coal opportunities on federal lands,” states the year-end report released Tuesday by the President’s Council on Jobs and Competitiveness.

The report does not specifically mention the Keystone XL oil pipeline, but it endorses moving forward quickly with projects that “deliver electricity and fuel,” including pipelines.

“The Council recognizes the important safety and environmental concerns surrounding these types of projects, but now more than ever, the jobs and economic and energy security benefits of these energy projects require us to tackle the issues head-on and to expeditiously, though cautiously, move forward on projects that can support hundreds of thousands of jobs,” the report says.

The report retreats slightly from an interim report released in October that addressed the Keystone XL pipeline directly. The interim report appeared to offer cautious support for Keystone, calling on officials to “balance” environmental protections while realizing what it called the benefits of the pipeline.

But Keystone supporters will point out that the year-end report released Tuesday argues that energy projects like pipelines will result in economic and security benefits. It even echoes a common refrain from Republicans and the oil industry: that such energy projects “can support hundreds of thousands of jobs.”

White House press secretary Jay Carney insisted Tuesday that the jobs council report does not endorse the Keystone pipeline.

“Well, first of all, the Jobs Council wasn’t talking about Keystone specifically,” Carney said at his daily briefing. “The Jobs Council was talking about the importance of expanding domestic oil and gas production, a goal this president shares and has expounded upon at length, and has taken action as a policy matter to demonstrate his commitment to.”

The Keystone XL pipeline would carry oil sands crude from Alberta, Canada, to refineries on the Gulf Coast.

“The Council recognizes that providing access to more areas for drilling, mining and renewable energy development is controversial, but, given the current economic situation, we believe it’s necessary to tap America’s assets in a safe and responsible manner,” the report says.

“Additionally, policies that facilitate the safe, thoughtful and timely development of pipeline, transmission and distribution projects are necessary to facilitate the delivery of America’s fuel and electricity and maintain the reliability of our nation’s energy system.”

Stakeholders should work together to develop “best practices” aimed at ensuring safety, while also expediting energy projects, according to the report.

“[R]egulatory and permitting obstacles that could threaten the development of some energy projects negatively impact jobs and weaken our energy infrastructure need to be addressed,” the report says. “Speedy adoption of best practice standards would allow government officials to reduce regulatory and permitting obstacles to important energy projects.”

Under a payroll tax cut packaged signed into law in December, the president must make a decision on the pipeline by Feb. 21. White House and administration officials have said they will have little choice but to reject the pipeline under the deadline, arguing they will not have enough time to adequately review the project.

The looming deadline has set off an aggressive lobbying campaign. Republicans and industry officials argue that the project has been subject to sufficient review and is essential for boosting the ailing economy and creating jobs.

But environmental groups and other opponents of the pipeline have raised concerns about greenhouse gas emissions from oil sands production, as well as potential oil spills.
House Republicans quickly pounced on the jobs council report Tuesday, noting that the recommendations echo their “all-of-the-above” energy strategy.

“The President’s Jobs Council today confirmed what House Republicans have known all along, that American energy production will spur job creation and strengthen our national security,” House Natural Resources Committee Chairman Doc Hastings (R-Wash.) said in a statement. “Unfortunately, it appears President Obama is ignoring his Council’s recommendations, much as he has ignored the views of House Republicans on energy production, economic growth and job creation.”

More broadly, the jobs report calls for expanded oil-and-gas drilling, as well as “safe and responsible” natural-gas extraction from shale formations.

The report notes that the Obama administration has called for new lease sales and said it will consider opening up new areas to drilling. But it says “further expanding and expediting the domestic production of fossil fuels both offshore and onshore (in conjunction with more electric and natural gas vehicles) will reduce America’s reliance on foreign oil and the huge outflow of U.S. dollars this reliance entails.”
Beyond oil and gas, the report calls for policies that improve energy efficiency, encourage private investment in energy research and development and expand renewable energy.

Special thanks to Richard Charter

http://www.washingtonpost.com/national/health-science/obama-administration-to-reject-keystone-pipeline/2012/01/18/gIQAPuPF8P_story.html

By Juliet Eilperin and Steven Mufson,

The Obama administration will announce this afternoon that it is rejecting a Canadian firm’s application for a permit to build and operate the Keystone XL pipeline, a massive project that would have stretched from Canada’s oil sands to refineries in Texas, according to people who have been briefed on the matter.

However the administration will allow TransCanada to reapply after it develops an alternate route around the sensitive habitat of Nebraska’s Sandhills. Deputy Secretary of State William J. Burns will make the announcement, which comes in response to a congressionally mandated deadline of Feb. 21 for action.

Industry officials and analysts said they expect TransCanada to submit a new route proposal for the Nebraska leg of the pipeline within two weeks.

TransCanada declined to comment on the matter Wednesday; the White House declined to comment on its upcoming decision Tuesday night and Wednesday morning.

The effect of the administration’s move will probably be to delay the politically sensitive pipeline decision until after the presidential election – the second time it has postponed a final determination. Environmental groups have lobbied against the project, arguing that the difficult extraction of oil sands contributed to climate change and that the pipeline itself posed leak risks. Supporters of the pipeline say it will create jobs and enhance U.S. energy security by increasing oil supplies from a friendly neighbor.

“President Obama is about to destroy tens of thousands of American jobs and sell American energy security to the Chinese,” said Brendan Buck, a spokesman for House Speaker John Boehner (R-Ohio) . “The President won’t stand up to his political base even to create American jobs. This is not the end of this fight.”

The pipeline, which requires a federal permit from the State Department because it crosses an international border, has been under review for more than three years. The department is required to determine whether the project is in the U.S. national interest.

In early November, the administration delayed making that determination on the pipeline on the grounds that the pipeline needed to avoid crossing sensitive terrain in Nebraska’s Sand-hills region. At the time, officials predicted the process of rerouting the pipeline and the subsequent environmental review would extend the permitting process into early 2013.

But language inserted in last month’s payroll tax extension forces President Obama to make a decision by Feb. 21.

Administration officials have said for weeks that the truncated timeline makes it difficult to complete a review of whether the pipeline is in the national interest, given the fact TransCanada has yet to outline an alternate route.

Some political observers said that the effort by Congress to pressure the president into making a quick decision might have backfired. Last week, John Engler, former Michigan governor who is now head of the Business Roundtable, said “no chief executive likes to be painted into a corner by anybody, whether another nation or a legislative body. There are a couple of ways to react and one of them is a negative way.” Engler and the Business Roundtable support the pipeline project.

On Tuesday, White House spokesman Jay Carney called it “a fallacy to suggest that the president should sign into law something when there isn’t even an alternate route identified in Nebraska and when … there was an attempt to short-circuit the review process in a way that does not allow the kind of careful consideration of all the competing criteria here that needs to be done.”

“President Obama is doing the right thing standing up to oil lobbyists and sticking up for the families who are protecting their clean water from the Keystone export pipeline,” said Jeremy Symons, senior vice president of the National Wildlife Federation, in an e-mail.

On Wednesday, Daniel J. Weiss, who directs climate strategy for the liberal think tank Center for American Progress, said Obama’s decision to turn down the Keystone XL permit makes sense.

“The Republican provision to force a decision in sixty days for a route that hasn’t been chosen yet is asking the President to write a blank check to a big foreign oil company regardless of the harm to Americans,” Weiss wrote in an e-mail. “Denial of the Keystone XL permit would mean that President Obama will protect Americans by ensuring that the pipeline construction and operation will not pollute our air and water. This approach is like having medical tests before deciding on surgery.”

Even Stephen Brown, vice president for federal government affairs for the oil refiner Tesoro Cos., wrote in an e-mail that he was not surprised by the move.

“Today’s decision will be a fairly easy one for the White House to make,” Brown wrote. “No one who was planning on voting against the President would have been won over simply because of the approval of Keystone.”

Special thanks to Richard Charter

http://www.nola.com/news/gulf-oil-spill/index.ssf/2012/01/gulf_of_mexico_oil_spill_envir.html

Published: Thursday, January 12, 2012, 10:45 PM Updated: Friday, January 13, 2012, 8:42 AM
By Mark Schleifstein, The Times-Picayune

BP’s chief environmental scientist assigned to the Deepwater Horizon oil spill on Thursday said the company, working with state and federal trustees, remains on a fast pace aimed at restoring resources damaged during the 2010 spill in the Gulf of Mexico. Briefing reporters by phone in advance of a month-long series of hearings on proposed “early restoration projects” along the Gulf Coast, Robin Bullock said the formal Natural Resource Damage Assessment process required under federal law has developed “the largest set of environmental data at one point in time associated with an oil spill incident within the Gulf of Mexico.”

Hundreds of scientists — from universities, federal agencies and hired by BP — have gathered data on the status of Gulf resources before the spill, and the potential for resource damage from the estimated 5 million barrels of oil that gushed from BP’s Macondo well. That information was used to develop projects to restore natural resources and compensate the public for the use of those lost resources.

The hearings will focus on the first eight projects proposed in December by states’ trustees and BP, which total $57 million for the Gulf Coast and includes $28 million for Louisiana projects. BP has pledged to spend $1 billion on “early restoration” projects, but the company and other parties responsible for the spill may eventually have to spend as much as $20 billion on natural resource projects.

The first two Louisiana projects will build more than 100 acres of wetlands in Plaquemines Parish, place oyster cultch on six public seed beds in several parishes and upgrade an oyster hatchery on Grand Isle.

The projects were approved by a committee of trustees representing the five Gulf Coast states, the federal departments of Interior and Commerce and BP. Under the Oil Pollution Act of 1990, the trustees and the parties responsible for the spill are required to cooperatively complete the damage assessment process.

The early projects are driven by the early lessons learned by scientists, Bullock said.

“We knew a few things about the injuries very quickly,” she said, including the effects on recreational fishers by the closure of wide swaths of the Gulf to fishing, and to tourists by beach closures.

The $4.4 million proposed for building boat ramps and $600,000 for coastal dunes in Florida is aimed at compensating for such lost recreational opportunities.

“On the ecological side, we do know that oil reached the shorelines,” Bullock said. “We do know that we did have some mortality associated with birds, some mortality associated with turtles,” and projects aimed at restoring near-shore environments would compensate for their losses, she said.
Louisiana’s projects fall into the resource restoration category, as do the $11 million for oyster cultch and $2.6 million for an artificial reef in Mississippi and the $9.4 million for marsh creation and $1.1 million for coastal dune improvements in Alabama.

Louisiana’s first two projects are part of a $533 million list of 13 projects that it proposed in July for a share of BP’s early restoration money, said Louisiana Coastal Protection and Restoration Authority chairman Garret Graves, who acts as Louisiana’s trustee in the damage assessment process.

Louisiana is supposed to get $200 million of the first $1 billion, but hopes some of the projects could be paid for with shares of the BP money provided that will go to the Commerce and Interior departments.

Bullock and Graves could not say when additional projects will be announced, but the agreement signed by trustees and BP set a goal of beginning construction of projects by the end of 2012, Graves said.

“The intent of Louisiana is to stick to that time frame,” Graves said.
Public comments are being accepted on the first list of projects through Feb. 14, including on the web at http://losco-dwh.com/EarlyRestorationPlanComment.aspx .

Recommendations for future projects also will be accepted.
In Louisiana, state officials will hold three public meetings to discuss the projects, each beginning at 5:30 p.m., with a public hearing at 6:30 p.m.:
* Jan. 31, Terrebonne Council Chambers, 8026 Main St., second floor, Houma.
* Feb. 1, St. Bernard Parish Council Chambers, 8201 West Judge Perez Drive, Chalmette.
* Feb.. 2, Belle Chasse Auditorium, 8398 Louisiana 23, Belle Chasse.

Mark Schleifstein can be reached at mschleifstein@timespicayune.com or 504.826.3327.

Special thanks to Richard Charter