Wednesday, September 28, 2011

Cuba drilling next hurdle for U.S.

Cuba drilling next hurdle for U.S.
By DARREN GOODE | 9/27/11 10:38 PM EDT

The White House must crisscross complex political and policy waters as
it faces the impending reality of oil drilling off Cuba a mere 60 miles
from the Florida Keys.

"It's just like firing a shotgun in a crystal store," said Jorge Piñón,
a visiting fellow with the Florida International University Latin
American and Caribbean Center's Cuban Research Institute. "You're going
to break something eventually."

That presents multiple challenges for the Obama administration, which is
tasked with protecting the U.S. coastline and waters if a catastrophe
begins off Cuba.

"I think there is a lot of a tendency to hold the breath and hope it
doesn't happen," said Lee Hunt, president of the International
Association of Drilling Contractors. "I can assure you that inaction and
lack of leadership against a potential disaster would be this
administration's Katrina."

Administration officials have already upgraded drilling standards for
operations off the U.S. coast and have established a partnership with
Mexico to set higher bilateral standards in the Gulf of Mexico since
last year's historic spill. And Bureau of Ocean Energy Management,
Regulation and Enforcement Director Michael Bromwich said last week that
"the issue of drilling offshore Cuba has been on our screen for many

"I can say that this issue has been focused on and discussed in very
high levels of the government," Bromwich said.

The Spanish company Repsol is expected by January to begin drilling a
deepwater exploratory oil well off Cuba in waters about 60 miles south
of Key West and slightly deeper than BP's doomed Macondo exploration
well. Other exploratory wells from the same Chinese-built
semi-submersible rig owned by the Italian company Saipem would follow in
subsequent months — involving companies such as Russia's Gazprom.

"Politicians don't like to take the risk with Cuba unless they see a
clear positive payback of some sort," said Bill Reilly, a former EPA
administrator under President George H.W. Bush. "Now that we see the rig
approaching Cuban waters, the political calculus will change."

Reilly — who co-chaired a bipartisan commission that investigated last
year's Gulf spill — and Hunt were among a group granted permission by
the administration to trek to Havana in early September to talk to
senior Cuban officials in the absence of direct talks between the two

"The message was drilling in deepwater is a highly challenging, risky,
technologically complex job, and the lessons of Macondo show that even
very experienced companies and very practiced regulators can get it
wrong," Reilly said.

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