Cuba's offshore oil drilling platform under intense scrutiny

The Miami HeraldJanuary 27, 2012 

The Scarabeo 9 is a state-of the-art oil rig leased by a Spanish company, built in China and Singapore, owned by an Italian company and flagged in the Bahamas. But there's one part of its international pedigree that has some Floridians up in arms: it will be exploring for oil in Cuban waters.

After traveling half-way around the world, the rig has moved into place some 22 miles north of Havana and about 70 miles south of the Florida Keys. Repsol, the Spanish company that is leasing the rig for $511,000 day, said drilling begins this week.

But already, without finding a drop of oil, the hulking Scarabeo 9 has become one of the most analyzed, discussed and vilified rigs to ever sink an exploratory well.

Not only has its location raised fears that a blowout could dump oil on Florida’s beaches, damaging sensitive mangroves, sea grass, coral reefs and marine life but the U.S. embargo against Cuba has made preparedness and recovery from a possible oil spill particularly tricky.

While efforts by Cuban-American members of Congress to prevent Repsol from drilling altogether have been unsuccessful, there are still several bills pending that could complicate the company’s efforts.

“The political pressure on [Repsol] is unbelievable,’’ said Jorge Piñon, a former Amoco executive and now an oil consultant and visiting research fellow at Florida International University.

But with the rig now in place, the question has become how prepared are the United States, Cuba and Repsol to respond if disaster strikes?

Much of any U.S. response effort would be centered in South Florida.

Not only would the Miami-based 7th Coast Guard District be responsible for coordinating efforts to protect U.S. waters and shoreline, but the first private response to a major spill would likely come from Clean Caribbean & Americas, a Broward County oil spill response cooperative whose members include most of the major oil companies in the region.

The cooperative and Oil Spill Response, its sister organization in the United Kingdom, did much of the work on Repsol’s Cuban contingency response plan. “I think it’s in line with what they have elsewhere in the world,’’ said Paul Schuler, the cooperative’s president.

Although the United States has no regulatory control over Repsol’s drilling in Cuba, the Spanish company has voluntarily provided information on its drilling plans and allowed U.S. agencies to board and review the rig’s construction and safety systems when it was off the coast of Trinidad & Tobago earlier this month.

The Coast Guard and Interior’s Bureau of Safety and Environmental Enforcement said they found the rig “to generally comply with existing international and U.S. standards.’’

Meanwhile, Clean Caribbean & Americas’ warehouse is loaded with containment booms, skimming devices, an aerial system designed to spray dispersants from a C-130 Hercules aircraft, and other cleanup supplies to respond to a spill anywhere in the region.

Unlike many U.S. companies that are barred by the embargo from doing business with Cuba, the cooperative already has a license from the U.S. Office of Foreign Assets Control that would allow it to respond to a Cuban oil spill. It got the license in 2003 when Repsol drilled its first exploratory well in Cuba, said Schuler.

Repsol found oil but said at the time it wasn’t commercially viable. Now, the Spanish oil company is back with partners from Norway (Statoil) and India (ONGC Videsh) in a slightly different location and its rig has been specially built so that fewer than 10 percent of its components are made by U.S. manufacturers.

“They are betting big money on this. When a company of Repsol’s caliber goes through the expense of having a rig tailor-made to bypass the embargo, it tells me the probability of a successful find is very high,’’ said Piñon.

That prospect isn’t pleasing to Cuban-American members of Congress, including Republican representatives Ileana Ros-Lehtinen, David Rivera and Mario Diaz-Balart, who have fought tooth-and-nail to stop any drilling in Cuban waters and blasted the Obama administration for not doing more to prevent it. Florida’s senators, Bill Nelson and Marco Rubio, support a bill that would make a foreign oil company directly responsible for a spill that impacts the U.S.

The U.S. Geographical Survey estimates that Cuba’s offshore oil fields may contain around 5 billion barrels of oil and 9.8 billion cubic feet of natural gas. Cuban geologists estimate there is even more.

Efforts are underway to issue more licenses to companies whose expertise is expected to be needed to protect U.S. shores.

“I’m concerned there is not enough manpower and capacity to respond if there were a need to do so in the near future,’’ said Dan Whittle, Cuba program director at the Environmental Defense Fund.

There also has been talk of a quick turnaround time for issuing more licenses at the time of a spill.

But Whittle, who just returned from a trip to Cuba last week, said that may not be quick enough. “Forty-eight hours is a lot of hours to waste in those currents. Common sense dictates that you need to have your ducks in a row well in advance,’’ he said.

“The more resources, we have the better we can respond,’’ said Schuler, who plans to visit Scarabeo 9 next week. Because of the embargo, he said, “We are now making plans on the equipment we can get — not what we would like to have.’’

The embargo and political considerations also make talking directly with Cuba about its emergency response plan more complicated.

Instead, the United States has taken a multilateral approach involving all the countries in the region contemplating Caribbean drilling or that could be affected by a spill.

Officials from the Bahamas, Cuba, Mexico, Jamaica and the United States met in Nassau in December to discuss their well control and oil spill response plans. Another meeting has been proposed next week in Curacao.

Some who attended the meeting said despite the other nations present, the main dialogue was between Cuba and the United States.

Rear Adm. Bill Baumgartner, commander of the 7th Coast Guard district, said the Coast Guard has been planning for well over a year how it would handle any impact from drilling in Cuba and the Bahamas, which also may start offshore oil exploration this year.

The Coast Guard has revised its coastal contingency plans, analyzed reports and investigations from the Deepwater Horizon spill to see what lessons could be learned, and held training exercises.

In November, the Coast Guard hosted some 80 federal, state and local officials, industry representatives, including Repsol, and environmentalists for a tabletop exercise that looked at various scenarios for the flow of oil.

On Monday, the U.S. House Subcommittee on Coast Guard and Marine Transportation will hold a field hearing in Sunny Isles Beach to look at the Coast Guard’s oil spill readiness and response planning.

If there is a spill, Baumgartner said, “It’s unlikely the Florida coastline would be inundated with oil slicks.’’

Fast-moving currents could sweep oil past the Florida coast and out to the North Atlantic, Baumgartner said. But eddy currents could peel off and bring oil ashore, he said. That could also happen if wind conditions are just right.

And there are scenarios that could take oil to Cuba’s north coast — the center of its growing tourism industry. Last year, Cuba had 2.7 million visitors and tourism has become a major part of its economy.

“I think they are taking this very seriously,’’ Whittle said. “The Cubans are fully aware of the environmental challenges and risks.”

To read more, visit www.miamiherald.com.

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