RPT-Cuba Offshore Oil Rig Delayed Til Mid-Summer-Sources | Energy & Oil | Reuters

RPT-Cuba offshore oil rig delayed til mid-summer-sources | Energy & Oil | Reuters

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* Construction delays, repairs put off expected arrival AlertNet Humanitarian News * Rig is key to Cuba offshore oil development

Do More With Reuters RSS * Cuba says may have 20 billion barrels of oil offshore Professional Products Financial By Jeff Franks Media Support HAVANA, Jan 7 (Reuters) - A Chinese-built drilling rig that was expected Partner Services to arrive in Cuban waters in the first quarter of 2011 and begin the first Career Centre full-scale offshore oil exploration there has been delayed until mid- About Thomson summer, industry sources said on Friday. Reuters

They said construction of the rig, known as the Scarabeo 9, had CURRENCIES progressed more slowly than planned and now it would likely not get to Cuba until late June or early July. UK £ USD =1.5743 Euro USD =1.3145 Rand USD =0.1461 "That's the time frame we're being told," said an official from a company involved in the project, who asked not to be named.

Cuba and a number of international oil companies, led by Spain's Repsol YPF (REP.MC: Quote) (REP.N: Quote), are eagerly waiting to see what lies beneath the Caribbean island's part of the Gulf of Mexico, where Cuba says it may have 20 billion barrels of oil in its untapped fields.

The U.S. Geological Survey has estimated a more modest 4.6 billion barrels and 10 trillion cubic feet of gas.

The expected rig, which belongs to Saipem (SPMI.MI: Quote), a unit of Italian oil company ENI SpA ENI.M, was constructed at Yantai CIMC Raffles YRSL.NFF shipyard in China, but due to delays was sent in October to the Keppel Fels (KPLM.SI: Quote) shipyard in Singapore for completion.

As it was being towed to Singapore, a water leak was discovered that required repair, said the company official.

Delays for the Scarabeo 9, which is a high-tech semi-submersible rig capable of working in water depths up to 3,600 meters (11,811 feet), are not new. It was originally set for completion in September 2009.

http://af.reuters.com/article/energyOilNews/idAFN0723371820110108?pageNumber=3&virtualBrandChannel=0&sp=true[13/01/2011 09:06:05] RPT-Cuba offshore oil rig delayed til mid-summer-sources | Energy & Oil | Reuters

A Repsol-led consortium that includes Norway's Statoil (STL.OL: Quote) (STO.N: Quote) and ONGC Videsh, a unit of India's Oil and Natural Gas Corp (ONGC.BO: Quote), has contracted the rig first and will drill one or two exploratory wells off Cuba's northwestern coast, then pass it on to other companies with leases for offshore blocks.

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Repsol drilled the only previous exploration well in Cuba's part of the Gulf of Mexico in 2004 and said it found hydrocarbons, but has not yet sunk another well.

It was widely believed to have had problems finding another rig that did not violate the long-standing U.S. trade embargo against Cuba, which limits the amount of American technology that can be used.

Malaysia's state oil company Petronas and its partner Gazprom Neft (SIBN.MM: Quote) of Russia are slated to get the rig after Repsol, then it will go to ONGC Videsh, which has two blocks of its own.

Other companies with Cuban offshore leases include Brazil's Petrobras (PETR4.SA: Quote) PBR.N., Venezuela's PDVSA, PetroVietnam and Angola's Sonangol.

Russian oil firm Zarubezhneft has two nearshore blocks and an agreement with PetroVietnam to participate in exploration of its three blocks.

No U.S. companies are involved in Cuba because they are prohibited by the U.S. embargo against the island, 90 miles (145 km) from Florida.

For Cuba, much is riding on the outcome of the projects. It needs the oil to help its fragile economy and to end its dependence on oil-rich socialist ally Venezuela, which provides about 115,000 barrels per day on favorable terms.

The country is currently in the midst of economic reforms to modestly liberalize one of the last state-dominated, Soviet-style systems in the world. (Editing by Pascal Fletcher and Sofina Mirza-Reid)

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http://af.reuters.com/article/energyOilNews/idAFN0723371820110108?pageNumber=3&virtualBrandChannel=0&sp=true[13/01/2011 09:06:05]