Tag Archives: Petroleum

Russians Commence Petroleum Exploration off the Cuban Coast

Posted on June 28, 2012 by Arch Ritter

Nick Miroff,  June 28, 2012;  from Globalpost.com

The Songa Mercur Drilling Platform

HAVANA, Cuba — For 30 years, generous oil subsidies from Moscow kept the lights on for Fidel Castro’s Cuban Revolution. Until the Soviet Union went kaput. Now, Russian state oil companies may be coming to Cuba’s rescue again.

Oil industry journals reported this week that a Soviet-built, Norwegian-owned drilling platform is headed for Cuban waters this summer, under contract with Moscow-based state company Zarubezhneft. The company has hired the rig, called the Songa Mercur, at a cost of $88 million for nearly a year, with plans to begin drilling in November. That should be enough time to poke plenty of holes in search of Cuba’s elusive undersea oil fields, which are thought to hold billions of barrels of crude but have yet to yield a decent strike.

The rig’s arrival couldn’t come at a better time for the Castro government and its state oil company, CubaPetroleo. The state firm has signed multiple contracts in recent years with foreign producers looking to drill in Cuban waters.

Another drilling platform, the Scarabeo 9, has been working off the island’s north coast this year, but has come up dry, dealing a blow to Havana’s hopes for weaning the island off imported crude.

Cuba currently gets about two-thirds of its fuel from socialist ally Hugo Chavez. But the Venezuelan president has been battling cancer and must campaign for re-election in October.

The Scarabeo 9 has been Cuba’s best hope. The Chinese-built, Italian-owned rig arrived late last year, opening a gusher of anxieties in the US. Environmental groups and Florida tourism operators worried about damage from a potential spill. Anti-Castro lawmakers worried an oil strike would give the Cuban government a cash windfall. Repsol, the Spanish oil company that first hired the rig, was the subject of hearings on Capitol Hill, and the Obama administration made the unusual move of sending an inspection team to visit the platform when it stopped in Trinidad en route to Cuban waters. But the state-of-the-art Scarabeo 9 was made for the Cuba job — literally. It is the only rig in the world designed specifically to comply with US trade sanctions against Cuba, which limit the amount of US technology that can be used in Cuban territory to no more than 10 percent.

So far the rig has come up empty in Cubans waters. Having spent more than $100 million for a dry well and a political headache, Repsol executives have announced they’re pulling out of Cuba.

Scarabeo 9 is now in the hands of Russia’s Gazprom Neft, which is drilling in Cuban waters at another offshore location in partnership with Malaysia’s Petronas. Results may be announced as soon as next month.

The Songa Mercur will be working much closer to shore. Built in 1989 at the Soviet Union’s Vybord Shipyards, its maximum drilling depth is just 1,200 feet of water, according to the rig’s specifications.

Jorge Piñon, an expert on Cuban oil exploration at the University of Texas, said the Songa Mercur was retrofitted and modernized in 2006 in Galveston, Texas, after it was purchased from a Mexican firm by Norway’s Songa Offshore SE. It’s currently working in Malaysia.

Unlike the Scarabeo 9, the Songa Mercur is loaded with US technology, including five Caterpillar generators, General Electric mud pump motors, and cementing equipment made by Halliburton. That will likely leave Russian operator Zarubezhneft in violation of the US’ Cuba sanctions, Piñon said.

Not that there’s much the US government can do about it. “This is a Russian state oil company, and they do not have US assets or interests to safeguard,” said Piñon, a former British Petroleum executive. “Do you think that Zarubezhneft is going to invite the US Coast Guard and the Interior Department to board (the Songa Mercur)?” he said. “How then is [the US] going to validate whether the Songa Mercur meets the embargo regulations?” The area where the platform will be drilling is off the coast of Cuba’s Ciego de Avila and Villa Clara provinces, and adjacent to an area that the Bahamas Petroleum Corporation is also looking to develop, Piñon added.

That location should present less of a threat to US beaches in the event of a spill, according to Lee Hunt, former president of the Houston-based International Association of Drilling Contractors. Shallow water does not eliminate the risk, Hunt said, but ocean currents in that area would likely keep floating crude away from US shores. “What has not changed is the need for blowout prevention,” said Hunt, who advocates closer cooperation between the US and Cuba on oil spill prevention. “The best and safest practices, and preparation for spill capping, capture, containment and cleanup remain risk factors for Cuba and the United States.”

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Cuba waits anxiously for oil dreams to materialize

Posted on May 29, 2012 by Arch Ritter

By PAUL HAVEN. Associated Press, May 27, 2012

HAVANA (AP) — It was supposed to be Cuba’s economic savior: vast untapped reserves of black gold buried deep under the rocky ocean floor.

But the first attempt in nearly a decade to find Cuba’s hoped-for undersea oil bonanza has come up dry, and the island’s leaders and their partners must regroup and hope they have better luck – quickly.

Experts say it is not unusual that a 3-mile (4.8-kilometer) deep exploratory well drilled at a cost of more than $100 million by Spanish oil giant Repsol was a bust. Four out of five such wells find nothing in the high-stakes oil game, and petroleum companies are built to handle the losses.

But Cuba has more at stake, and only a few more spins left of the roulette wheel. The enormous Scarabeo-9 platform being used in the hunt is the only one in the world that can drill in Cuban waters without incurring sanctions under the U.S. economic embargo, and it is under contract for only one to four more exploratory wells before it heads off to Brazil.

“If oil is not found now I think it would be another five to 10 years before somebody else comes back and drills again,” said Jorge Pinon, the former president of Amoco Oil Latin America and a leading expert on Cuba’s energy prospects. “Not because there is no oil, but because the pain and tribulations that people have to go through to drill in Cuba are not worth it when there are better and easier options in places like Angola, Brazil or the U.S. Gulf of Mexico.”

A delay would be catastrophic for Cuba, where 80-year-old President Raul Castro is desperately trying to pull the economy out of the doldrums through limited free-market reforms, and has been forced to cut many of the subsidies islanders have come to expect in return for salaries of just $20 a month.

It could also leave the Communist-governed island more dependent on Venezuela, where President Hugo Chavez is ailing with cancer. Chavez provides Cuba with $3 billion worth of heavily subsidized oil every year, a deal that might evaporate if he dies or fails to win re-election in October.

An oil find, on the other hand, would potentially improve Cuba’s long-bitter relations with the United States, some analysts suggest. They say the U.S. oil industry could lobby Congress to loosen the embargo so it could get in on Cuba’s oil game. At the very least, coordination between the Cold War enemies would be necessary to prepare for any spill that could coat beaches in the U.S. and Cuba with black goo.

The Cuban government has not commented on Repsol’s announcement May 18 that the first well came up dry, and declined to make any oil officials or experts available to be interviewed for this article.

Next in line for using the drilling rig in Cuban waters is Malaysia’s Petronas, which holds the rights to explore an area in the Florida Straits known as the Northbelt Thrust, about 110 miles (180 kilometers) southwest of Repsol’s drill site. Wee Yiaw Hin, Petronas’ executive vice president of exploration and production, told The Associated Press that drilling has begun and he expects results by the end of July.

After that, two industry experts said, Repsol is under contract to drill a second well, though it could get out of the deal by paying a penalty to Saipem, the Italian company that owns the rig. Kristian Rix, a spokesman for Repsol in Madrid, said a decision on whether to sink another well was still being evaluated.

Venezuela’s PDVSA and Sonangol of Angola have options to drill next, but are under no obligation if they don’t like their odds. While both countries are strong allies of Cuba, at $100 million a well, the decision to drill will likely be based solely on economics.

Even if oil is found, the Scarabeo-9 is under contract to power up its eight enormous thrusters and sail to Brazil after that, with no date set for its return to Cuba. The bottleneck highlights the difficulties Cuba faces, and why it could be well into the 2020s before the island sees any oil windfall.

“Assuming they’re successful in finding oil, to bring the oil to market will take years of development efforts,” said Victor Shum, an energy analyst with consulting firm Purvin & Gertz in Singapore.

Once an exploratory well finds oil, companies generally drill between 10 and 20 additional wells nearby to get a sense of the reservoir’s size. The process can take several years even under normal circumstances, and circumstances are not normal in Cuba.

The Scarabeo-9 was built in Asia with less than 10 percent U.S.-made parts to avoid violating Washington’s embargo, making it the only rig in the world that meets the requirement. That means no other rig could be used in Cuba without risking U.S. sanction, and the additional wells would have to be drilled by the rig one at a time, with each taking about 100 days to complete. At about three wells a year, it could take up to six years for this second phase – assuming the rig is available.

After gauging a reservoir’s size, an oil company then must assess whether the economics of a field make it a prime spot for exploitation, or whether to concentrate resources elsewhere.

If exploitation does go forward, complicated equipment is required to pull oil from such depths. Several industry experts said the only country that produces the necessary apparatus is the United States, although Brazil and other countries are working to catch up. Unless they do, the oil could not be removed unless the U.S. embargo was lifted or altered.

“A lot of folks are looking at the energy sector in Cuba because they are looking at a Cuba of five years from now, or 10 years from now,” said Pinon. “So a lot of people are betting that either the embargo is going to be lifted, or the relationship between the U.S. and Cuba is going to improve in some way.”

Still, the benefits of hitting a gusher would be enormous for Cuba, and the impact could be felt long before any oil was pumped.

Because of the embargo, Cuba is shut off from borrowing from international lending institutions, and the island’s own poor record of repayment has left most other creditors leery. Cuba, for instance, owes the Paris Club of creditor nations nearly $30 billion.

An oil find could change the game, with Cuba using future oil riches as collateral to secure new financing, economists say. They point to China and Brazil as potential sources of new funding, but say neither is likely to put money into the island without reasonable confidence they will get their investment back.

Lee Hunt, the recently retired president of the Houston-based International Association of Drilling Contractors, said the stakes are enormous for Cuba that one of the wells hits oil before the Scarabeo-9 leaves. Hunt has worked to bring U.S. and Cuban industry and environmental groups together.

“If the only rig you can work with is gone, it’s like somebody took your shovel away,” Hunt said. “You are not going to dig any holes without a shovel, even if you know the treasure is down there.”

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Cuba crackdown sees foreign companies exit

Posted on May 24, 2012 by Arch Ritter

Financial Times, May 21, 2012 5:29 pm

Cuba crackdown sees foreign companies exit

By Marc Frank in Havana

Tighter restrictions following President Raúl Castro’s crackdown on state corruption and inefficiency is leading foreign businesses to leave Cuba, jeopardising the investment that his reform programme needs if it is to succeed.

The number of foreign joint ventures in Cuba has now fallen to no more than 240, according to government insiders, versus 258 in 2009, the last official figures available, and more joint ventures have closed than opened since the reform package was approved last April.

One of the latest companies to go is Unilever, the Anglo-Dutch consumer giant, after a 15-year joint venture expired and a dispute over the controlling interest in a new venture could not be resolved, a local manager said, asking not to be named.

At the same time, an offshore oil find that Havana had hoped would lead to increased access to international capital and less dependency on socialist ally Venezuela has so far proved fruitless after Repsol, the Spanish oil company, said late last week that the first of three test wells drilled in Cuban waters had no oil.

It was hoped that sweeping reforms adopted by the Communist party last year would open the way for significant foreign investment. But the government has instead re-examined existing agreements and stalled new projects, foreign business sources said.

Four joint ventures controlled by two Canadian trading firms are in the process of being “liquidated”. The top two executives in a British fund, Coral Capital, which says it has invested $75m in Cuba – much of it in the luxurious Saratoga hotel – are being held, although not charged with any offence, on suspicion of corrupt practices. Another target – Max Marambio, a Chilean businessman and friend of Fidel Castro – fled the country after being charged with corruption last year.

Although Mr Castro’s reform plan promised a review of cumbersome foreign investment procedures, promoters of several golf course projects report they are still waiting for approval, despite government promises to sign off in 2011, as are various companies that have been negotiating sugar ventures since 2006.

A multibillion-dollar plan to expand a refinery in central Cienfuegos and build a petrochemical complex around it, announced years ago, has also yet to materialise.

“I like to think the government is cleaning up the house before opening the front door,” Cuban economist Juan Triana told a gathering of British and Canadian businessmen last week.

One western diplomat said: “Cuba is reviewing the investment terms and some officials have said they want to fix mistakes made when the country first opened up to foreign investment in the 1990s, closing contracts that were not beneficial enough.”

Most experts and diplomats believe Mr Castro’s plans to lay off up to 1m state workers and lift the country out of its economic malaise will fail without large flows of direct investment, or a major oil find in the Gulf of Mexico.

The need for foreign partners is especially acute given the uncertain future of Cuba’s cancer-stricken ally, Venezuelan president Hugo Chávez, who provides the island with some 115,000 barrels of subsidised oil a day and faces a presidential vote in October, which he could lose.

“While it is far from clear what the future holds for Chávez and Venezuela, Cuba must be ready for it,” said John Kirk, a Latin America expert at Dalhousie University in Halifax, Canada.

“Given the continued US will to stymie any access to international lending organisations, the only source of significant capital around is still going to be foreign and private,” he added.

Of the dozen or so multinationals operating in Cuba, Telecom Italia left in 2011 while those remaining include Nestlé (bottled water), Sol Melia (hotels), Pernard-Ricard (rum), Anheuser-Busch InBev (beer), Imperial Tobacco (cigars) and Bouygues Batiment (construction).

If Havana hoped an offshore oil find would strengthen its position, it may now have to think again after Repsol said on Friday that the test well it drilled to 4,500m below the seabed was dry. Russia’s Gazprom and Malaysia’s Petronas will soon drill a second well, and Venezuela’s PDVSA is tentatively scheduled to drill a third. The US Geological Survey has estimated that Cuban waters could contain 5bn barrels of oil.

 

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Mark Frank: “Cuba drags feet on foreign investment”

Posted on May 16, 2012 by Arch Ritter

* No increase in foreign investment despite reforms

* Potential new partners wait for answers

* Existing ventures under scrutiny

Camilo Cienfuegos Refinery

By Marc Frank

HAVANA, May 15 (Reuters) – Cuba’s reform plans to attract more overseas investment are off to a slow start as the government focuses more on regulating existing foreign joint ventures than encouraging new ones, businessmen and diplomats say.

In fact, Cuba has closed more joint ventures than it has opened since the ruling Communist Party adopted wide-ranging economic reforms a year ago, and remains far off highs reached in the 1990s, according to official reports.

The list of endangered or terminated joint ventures includes one big name, Unilever PLC, the Anglo-Dutch consumer giant, and a number of others that have operated in the country for 15 years or more.

Cuba’s investment reform plan announced last year spoke positively of foreign investment, promised a review of the cumbersome approval process and stated that special economic zones, joint venture golf courses, marinas and new manufacturing projects were planned.

Most experts believe large flows of direct investment will be needed for development and to create jobs if the government follows through with plans to lay off up to a million workers in an attempt to lift the country out of its economic malaise.

It will be particularly critical given the health of cancer-stricken ally Venezuelan President Hugo Chavez, who has championed close cooperation between Cuba and oil-rich Venezuela.

While the reform plan built up hopes of an opening to foreign capital, it also made clear that existing and future investments would be subject to “rigorous controls” on “regulations and procedures, as well as the commitments assumed by foreign partners.” This part of the program has been vigorously carried out, according to both business and Cuban sources, with a review of the country’s approximately 240 foreign investment projects recently concluded.

That number is a decline from the 258 projects Foreign Trade and Investment Minister Rodrigo Malmierca reported at the close of 2009 and way down from the 700 Cuba had a decade ago.

The issue in part appears to be the result of old ideological habits dying hard, said Geoff Thale, program director at the Washington Office on Latin America.

Other reforms, such as encouraging more self employment and private farming, have been easier to implement.

“From the point of view of the state, an opening to foreign investment seems like a much bigger step to take in changing the economic model than does the liberalizing of domestic agriculture or current opening to small business,” Thale said.

VENTURES CLOSE

Unilever PLC, the Anglo-Dutch consumer giant, is the latest and best known of the foreign firms to pack its bags.

The company’s 15-year, 50-50 economic association has expired and a dispute over the controlling interest in a new venture could not be resolved.

“We wanted 51 percent of the new venture and so did the Cubans. At this point we are leaving, even though some discussion is still going on,” a company manager said, requesting anonymity.

Israeli investors, operating out of the Panama-based BM Group, recently pulled out of their longstanding juice processing business after new contract negotiations broke down, according to the business sources.

Investors in Havana’s container terminal are leaving as Cuba prepares to open a new terminal at Mariel, diplomats said.

Several ventures controlled by two Canadian trading firms and British investment fund Coral Capital under investigation for alleged corrupt practices are in the process of liquidation. Th e ir offices were closed last year and their top executives arrested as part of the crackdown on corruption.

SOCIALIST INVESTMENT

Following the election in Venezuela in 1998 of president Hugo Chavez, an avowed socialist, Cuba turned away from encouraging private investment in favor of state-funded cooperation with its new oil-producing ally.

Venezuela has since become Cuba’s biggest economic partner, with some 50 joint ventures signed over the last 10 years, although many are still only on the drawing board.

Cuba depends on Venezuelan oil to meet its domestic energy needs and Chavez’s uncertain future makes it more imperative that the Cuban government pick up the pace if it wants more foreign investment, said a western diplomat.

“The Cubans may be allergic to foreign investment, but the clock is ticking, and concessions on this front are inevitable,” the diplomat said.

“Instead, they are going over existing companies with a fine-tooth comb. It is hard to understand. Perhaps they are waiting for oil to be discovered offshore,” she said.

Other investment projects remain up in the air. A dozen golf course projects report no progress despite government promises to sign off after years of negotiations, as do companies negotiating ventures with the sugar industry since 2006.

Billion dollar plans to expand refineries and build a petrochemical complex around a refinery in central Cienfuegos, announced years ago, have yet to be signed off on.

On the other hand, in perhaps the most promising joint venture in decades, offshore oil exploration began in earnest this year with foreign partners planning at least three wells drilled by a massive, Chinese-built rig now parked 20 miles off the coast in the Gulf of Mexico.

Camilo Cienfuegos Refinery

$900 Million Brazil-financed Port Development at Mariel

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Council on Foreign Relations: “Addressing the Risk of a Cuban Oil Spill”

Posted on March 8, 2012 by Arch Ritter

Original here: Council on Foreign Relations: Policy Innovation Memorandum No. 15   March 2012

Scarabeo 9, en route to Cuba

Authors: Captain Melissa Bert, USCG, Military Fellow, U.S. Coast Guard and Blake Clayton, Fellow for Energy and National Security

The imminent drilling of Cuba’s first offshore oil well raises the prospect of a large-scale oil spill in Cuban waters washing onto U.S. shores. Washington should anticipate this possibility by implementing policies that would help both countries’ governments stem and clean up an oil spill effectively. These policies should ensure that both the U.S. government and the domestic oil industry are operationally and financially ready to deal with any spill that threatens U.S. waters. These policies should be as minimally disruptive as possible to the country’s broader Cuba strategy.

The Problem

A Chinese-built semisubmersible oil rig leased by Repsol, a Spanish oil company, arrived in Cuban waters in January 2012 to drill Cuba’s first exploratory offshore oil well. Early estimates suggest that Cuban offshore oil and natural gas reserves are substantial—somewhere between five billion and twenty billion barrels of oil and upward of eight billion cubic feet of natural gas. Although the United States typically welcomes greater volumes of crude oil coming from countries that are not members of the Organization of Petroleum Exporting Countries (OPEC), a surge in Cuban oil production would complicate the United States’ decades-old effort to economically isolate the Castro regime.

Deepwater drilling off the Cuban coast also poses a threat to the United States. The exploratory well is seventy miles off the Florida coast and lies at a depth of 5,800 feet. The failed Macondo well that triggered the calamitous Deepwater Horizon oil spill in April 2010 had broadly similar features, situated forty-eight miles from shore and approximately five thousand feet below sea level. A spill off Florida’s coast could ravage the state’s $57 billion per year tourism industry.

Washington cannot count on the technical know-how of Cuba’s unseasoned oil industry to address a spill on its own. Oil industry experts doubt that it has a strong understanding of how to prevent an offshore oil spill or stem a deep-water well blowout. Moreover, the site where the first wells will be drilled is a tough one for even seasoned response teams to operate in. Unlike the calm Gulf of Mexico, the surface currents in the area where Repsol will be drilling move at a brisk three to four knots, which would bring oil from Cuba’s offshore wells to the Florida coast within six to ten days. Skimming or burning the oil may not be feasible in such fast-moving water. The most, and possibly only, effective method to respond to a spill would be surface and subsurface dispersants. If dispersants are not applied close to the source within four days after a spill, uncontained oil cannot be dispersed, burnt, or skimmed, which would render standard response technologies like containment booms ineffective.

Repsol has been forthcoming in disclosing its spill response plans to U.S. authorities and allowing them to inspect the drilling rig, but the Russian and Chinese companies that are already negotiating with Cuba to lease acreage might not be as cooperative. Had Repsol not volunteered to have the Cuba-bound drilling rig examined by the U.S. Coast Guard and Bureau of Safety and Environmental Enforcement to certify that it met international standards, Washington would have had little legal recourse.

The complexity of U.S.-Cuba relations since the 1962 trade embargo complicates even limited efforts to put in place a spill response plan. Under U.S. law and with few exceptions, American companies cannot assist the Cuban government or provide equipment to foreign companies operating in Cuban territory.

Shortfalls in U.S. federal regulations governing commercial liability for oil spills pose a further problem. The Oil Pollution Act of 1990 (OPA 90) does not protect U.S. citizens and property against damages stemming from a blown-out wellhead outside of U.S. territory. In the case of Deepwater Horizon, BP was liable despite being a foreign company because it was operating within the United States. Were any of the wells that Repsol drills to go haywire, the cost of funding a response would fall to the Oil Spill Liability Trust Fund (OSLTF), which is woefully undercapitalized. OPA 90 limits the OSLTF from paying out more than $50 million in a fiscal year on oil removal costs, subject to a few exceptions, and requires congressional appropriation to pay out more than $150 million.

The Way Forward

As a first step, the United States should discuss contingency planning for a Cuban oil spill at the regular multiparty talks it holds with Mexico, the Bahamas, Cuba, and others per the Cartagena Convention. The Caribbean Island Oil Pollution Response and Cooperation Plan provides an operational framework under which the United States and Cuba can jointly develop systems for identifying and reporting an oil spill, implement a means of restricting the spread of oil, and identify resources to respond to a spill.

Washington should also instruct the U.S. Coast Guard to conduct basic spill response coordination with its counterparts in Cuba. The United States already has operational agreements in place with Mexico, Canada, and several countries in the Caribbean that call for routine exercises, emergency response coordination, and communication protocols. It should strike an agreement with Cuba that is substantively similar but narrower in scope, limited to basic spill-oriented advance coordination and communication. Before that step can be taken, U.S. lawmakers may need to amend the Cuban Democracy Act of 1992 to allow for limited, spill-related coordination and communication with the Cuban government.

Next, President Barack Obama should issue an export-only industry-wide general license for oil spill response in Cuban waters, effective immediately. Issuing that license does not require congressional authorization. The license should allow offshore oil companies to do vital spill response work in Cuban territory, such as capping a well or drilling a relief well. Oil service companies, such as Halliburton, should be included in the authorization.

Finally, Congress should alter existing oil spill compensation policy. Lawmakers should amend OPA 90 to ensure there is a responsible party for oil spills from a foreign offshore unit that pollutes or threatens to pollute U.S. waters, like there is for vessels. Senator Robert Menendez (D-NJ) and Congressman David Rivera (R-FL) have sponsored such legislation. Lawmakers should eliminate the requirement for the Coast Guard to obtain congressional approval on expenditures above $150 million for spills of national significance (as defined by the National Response Plan). And President Obama should appoint a commission to determine the appropriate limit of liability cap under OPA 90, balancing the need to compensate victims with the desire to retain strict liability for polluters.

There are two other, less essential measures U.S. lawmakers may consider that would enable the country to respond more adeptly to a spill. Installing an early-response system based on acoustic, geophysical, or other technologies in the Straits of Florida would immediately alert the U.S. Coast Guard about a well blowout or other unusual activity. The U.S. Department of Energy should find out from Repsol about the characteristics of Cuban crude oil, which would help U.S. authorities predict how the oil would spread in the case of a well blowout.

Defending U.S. Interests

An oil well blowout in Cuban waters would almost certainly require a U.S. response. Without changes in current U.S. law, however, that response would undoubtedly come far more slowly than is desirable. The Coast Guard would be barred from deploying highly experienced manpower, specially designed booms, skimming equipment and vessels, and dispersants. U.S. offshore gas and oil companies would also be barred from using well-capping stacks, remotely operated submersibles, and other vital technologies. Although a handful of U.S. spill responders hold licenses to work with Repsol, their licenses do not extend to well capping or relief drilling. The result of a slow response to a Cuban oil spill would be greater, perhaps catastrophic, economic and environmental damage to Florida and the Southeast.

Efforts to rewrite current law and policy toward Cuba, and encouraging cooperation with its government, could antagonize groups opposed to improved relations with the Castro regime. They might protest any decision allowing U.S. federal agencies to assist Cuba or letting U.S. companies operate in Cuban territory.

However, taking sensible steps to prepare for a potential accident at an oil well in Cuban waters would not break new ground or materially alter broader U.S. policy toward Cuba. For years, Washington has worked with Havana on issues of mutual concern. The United States routinely coordinates with Cuba on search and rescue operations in the Straits of Florida as well as to combat illicit drug trafficking and migrant smuggling. During the hurricane season, the National Oceanic and Atmospheric Administration (NOAA) provides Cuba with information on Caribbean storms.

The recommendations proposed here are narrowly tailored to the specific challenges that a Cuban oil spill poses to the United States. They would not help the Cuban economy or military. What they would do is protect U.S. territory and property from a potential danger emanating from Cuba.

Cuba will drill for oil in its territorial waters with or without the blessing of the United States. Defending against a potential oil spill requires a modicum of advance coordination and preparation with the Cuban government, which need not go beyond spill-related matters. Without taking these precautions, the United States risks a second Deepwater Horizon, this time from Cuba.

Oil Wells, along the Via Blanca, Matanzas Province, Photo by Arch Ritter, 1997

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Arturo Lopez-Levy and Jonathan Benjamin-Alvarado, “A Clash of Generations: U.S. 50 Year Old Embargo Meets Scarabeo 9”

Posted on February 15, 2012 by Arch Ritter

Original from Infolatam: http://www.infolatam.com/2012/02/13/cuba-choque-de-generaciones-la-scarabeo-9-y-el-embargo-de-50-anos/

Scarabeo 9, the semi-submersible oil rig contracted by the Spanish company Repsol completed its journey from Singapore to Cuba. Repsol’s rig will explore Cuba’s exclusive economic zone, an area in the Gulf of Mexico of about 112000 square kilometers. Oil exploration in the zone is being contracted to several foreign companies such as Venezuela’s PDVSA, Malaysia’s Petronas, and Vietnamese PetroVietnam. Cuba’s Ministry of Basic Industry estimates the oil reserves in the zone are between 5 billion to 9 billion barrels of oil. CNN GPS host Fareed Zakaria referred to Cuba’s total oil potential as between 5 billion and 20 billion barrels of oil.

The start of the oil exploration will not derail Raul Castro’s reform program. At a minimum, oil will not come from the offshore wells soon enough, while the reforms are needed immediately. The Cuban government needs to create jobs for the million and half workers that are supposed to leave the government sector in the next two years as part of the reforms program proclaimed last April by the Cuban Communist Party in its VI Congress. It must also alleviate critical situations of poverty in the five most eastern provinces, where unrest has been rising. With or without oil, the Cuban economy sorely needs to develop an environment in which businesses and individuals feel confident to invest.

The development of an oil based economy also poses a challenge for the anti-corruption policy President Raul Castro claims to support. The risk of potential backdoor deals and traffic of influence associated with the volume of oil profits cannot be contained without more transparency to hold corrupt or incompetent officials to account. To improve the quality of governance, the Cuban government must accelerate its opening to the best monitoring world practices and the training of its project managers, accountants, economists, and regulators. It must also lessen controls over the media and nongovernmental activities in ways that they can monitor and identify negligent and corrupt officials.

The impact on U.S.-Cuba relations:

In the early 1990’s, several studies of Cuban future scenarios (Edward Gonzalez and David Rondfelt’s “Cuba Adrift in a Post-Communist World”

of the Rand Corporation for instance) warned that a discovery of oil in Cuba would be a game changer for U.S-Cuba relations. Given the expectation that it will find oil in Cuba’s waters; the mere arrival of Scarabeo 9 strengthens Havana’s position versus Washington’s policy of isolation.

One must add that oil offshore exploration in Cuba has important implications in terms of U.S. national security, energy and environmental policies. Facing the danger of an oil spill in the Gulf of Mexico, Cuban American oil expert Jorge Piñón, associated with the University of Texas at Austin Jackson School of Geo-sciences, recommended an industry wide license “allowing U.S. oil equipment and services companies to provide goods, services and personnel to oil companies operating in Cuba in the event of an emergency”.

At a minimum, Piñón suggested that CUPET, Cuban oil company be allowed to join the International Association of Drilling Contractors (IADC) “in order to gain experience in deep-water drilling by the sharing of industry health, safety and environmental best practices through IADC conferences, training seminars, and technical publications in areas such as drilling and completion technology; standards, practices, legislation and regulations which provide for safe, efficient and environmentally sound drilling operations”.

The activation of the American business and environmental community about oil exploration in Cuban waters is already in motion. In December 2011, a joint delegation of the International Association of Drilling Contractors and the Environmental Defense Fund visited Cuba to explore ways to cooperate with Cuba beginning by common responses to potential spills. Last fall Senators Lisa Murkowski (R-AL) and Mary Landrieux

(D-La) sponsored a bill to allow “U.S. citizens and residents to “engage in any transaction necessary” for oil and gas exploration and extraction in Cuba — “notwithstanding any other provision of law.” The bill passed the Senate Committee on Energy and Natural Resources with the support of The Petroleum Equipment Suppliers Association (PESA).

Even in the “worst case scenario” for Cuba of a Republican victory in 2012, historical precedents such as the lifting of the embargo against Vietnam allow us to predict that the pro-embargo lobby doesn’t have the spine to stop the push of the American petroleum lobby. The opening of Agricultural trade with Cuba in 2000, showed how a mobilized and well-funded American farmers community defeated the pro-embargo lobby in a matter of two years. In the last decade, food sales to Cuba averaged $350 million a year. The trade peaked in 2008 at $ 700 million. If Scarabeo 9 discovers oil, the potential profits of American trade and investment in Cuba will easily exceed the agricultural trade revenues.

The Way Forward:

Sooner or later, we will read an op-ed by a pro-embargo lobbyist explaining that all this is a campaign by the Cuban government to entice the American business community, and that the only way forward is for the United States to fight with the companies that dared to explore oil fields next to our shores, respecting international laws and showing goodwill to our government but refusing to go along with the Cuban American right wing lobby in Southern Florida. It will insist that there are neither reforms nor reformist elements to nurture by engaging Cuba.

Here is a better course: The Obama Administration, which wasted a year since Repsol-YPF contracted the platform in China, should instead include Cuba in all regional cooperation efforts to design mutually beneficial hemispheric energy and environmental protection policies. To pursue such a goal and protect Florida and Gulf coast, the American and Cuban government should begin negotiations to train their officials for coordinated responses against accidents in the Florida Straits and protect their installations against any potential terrorist attack, from enemies of the United States or violent Cuban exile groups.

 

To nurture economic reform and anti-corruption initiatives in Cuba’s dealing with the oil industry, is clearly in the national interest of the United States. Since American companies contracting overseas are regulated by the 1977 Foreign Corrupt Practices Act, by far a more restrictive anti-corruption legislation than any of the countries involved in Cuba’s oil industry, President Obama can argue that it is in U.S. national interests to license American oil companies to contract any oil related activity in Cuba, beginning by environmental protection. This is legal within the framework of the Helms-Burton law.

A secure and stable world oil market is a fundamental United States national security interest. All serious predictions by American academic and intelligence community are forecasting the globalization of energy demand and an increase in world demand for oil by 20% or more over the next two decades, mainly in emerging markets. The risks of disruptions of oil extraction, refining or transportation, and oil spills are always present. Washington should not postpone anymore an urgent discussion about the convenience and the opportunity costs of refusing to engage Cuba’s oil industry.

Jonathan Benjamin-Alvarado

Arturo Lopez-Levy

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Spain’s Repsol begins Cuba offshore drilling-sources

Posted on February 3, 2012 by Arch Ritter

By Jeff Franks | Reuters – 17 hrs ago; HAVANA (Reuters)

Spanish oil company Repsol YPF has begun drilling the first well in Cuba’s long-awaited exploration of offshore oilfields that the communist country says hold both billions of barrels of oil and the key to greater prosperity, industry sources told Reuters on Thursday.

The massive Scarabeo 9 drilling rig, which arrived in Cuban waters two weeks ago, began drilling into the sea floor about 30 miles northwest of Havana on Tuesday night, the sources said.

A Repsol spokesman said the company could not comment on “operational details.”

The newly built, high-tech rig is operating in 5,600 feet of water, or what the oil industry calls “ultra-deep water,” in the Straits of Florida, which separate Cuba from its longtime ideological foe, the United States.

Sources close to the project said such wells generally take about 60 days to complete.

Repsol, which is operating the rig in a consortium with Norway’s Statoil and ONGC Videsh, a unit of India’s Oil and Natural Gas Corp, has said it will take several months to determine the results of the exploration.

The well is the first of at least three that will be drilled in Cuban waters with the Scarabeo 9, which was built in China and is owned by Saipem, a unit of Italian oil company Eni.

Sources have said that Repsol will drill the first well and then the rig will go to Malaysia’s Petronas in partnership with Russia’s Gazprom Neft and then back to Repsol for the third well.

It is not clear what happens after that, although some sources have said Repsol, which is leasing the Scarabeo 9 from Saipem at a rate said to be more than $500,000 a day, will move the rig to Brazil for exploration there.

Cuba has said it may have 20 billion barrels of oil in its northern waters, which are its part of the Gulf of Mexico. The U.S. Geological Survey has estimated it may have 5 billion barrels of oil, but its study does not include the entire Cuban gulf zone.

EASE FINANCIAL WOES

Cuba, which is in the midst of reforming its Soviet-style economy, is hoping oil will ease it chronic financial woes and bring energy independence from its socialist ally Venezuela. It receives about 115,000 barrels daily from the oil-rich South American country.

But if oil is found, experts say it could take five years or so to begin production because more drilling will be needed and production infrastructure put in place.

Repsol drilled the only previous offshore well in Cuba in 2004 and said it found oil but that it was not “commercial.”

It has been difficult to find a rig for more drilling because of the 50-year-long U.S. trade embargo against Cuba, which limits the amount of U.S. technology that can be used.

The Scarabeo 9, which is of Norwegian design, has only one piece of American equipment – the blowout preventer, a key part that failed in the 2010 blowout of a BP well in the U.S. Gulf of Mexico.

The BP well, which was in more than 5,000 feet of water and spilled 5 million barrels of oil, stained hundreds of miles of U.S. coastline.

In Florida, 90 miles north of Cuba, the Cuba offshore project has raised fears that a similar accident could damage the state’s beaches and coral reefs.

Drillers in Cuban waters could get within 45 miles of Florida, while in the U.S. gulf no exploration is permitted within 125 miles of the state.

At Repsol’s invitation, a team of U.S. experts inspected the rig in December in Trinidad and Tobago and said it complied with all existing engineering and safety standards.

But the United States, which has no official diplomatic relations with Cuba, has only made safety preparations from afar and has not been otherwise involved in the project.

Countries such as Norway and Brazil have helped lead an international effort to get Cuba ready for oil exploration and the possibility of an oil spill.

The project has gone forward despite opposition in the United States from Cuban exile leaders, who have proposed legislation in the U.S. Congress to try to stop Repsol.

They fear that oil will enrich and assure the survival of the Communist government they have long opposed.

“We need to figure out what we can do to inflict maximum pain, maximum punishment to bleed Repsol of whatever resources they have if there’s a potential for a spill that would affect the U.S. coast,” U.S. Rep. David Rivera from Florida told a congressional subcommittee in Miami on Monday.

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Marc Frank: US Frets at Cuba Oil Exploration

Posted on January 18, 2012 by Arch Ritter

Financial Times, January 18, 2012

By Marc Frank in Havana

A huge oil drilling platform will sink deepwater wells off Cuba next week in a move that has caused angst in the US at the prospect of significant oil discoveries that could alter Cuba’s economic future and Havana’s relations with Washington.

Cuba’s largely unexplored share of the Gulf of Mexico is thought to contain billions of barrels of oil and gas equivalent and has already drawn more foreign investment than any other sector of the economy.

“The discovery of even modest amounts of oil would be significant for Cuba,” said Ricardo Torres Perez, deputy director of Havana University’s Center for the Study of the Cuban Economy.

“Cuba would become less energy dependent and might eventually become an energy exporter; new credit and foreign investment would materialize, along with refining and service jobs.”

A significant discovery would almost certainly buy time for President Raúl Castro, as he works to reform the Soviet-style economy. In addition to environmental worries – as the drilling would unfold about 70 miles from Florida’s coast – this possibility has prompted vehement criticism from some US conservatives.

Ileana Ros-Lehtinen, who chairs the House foreign relations committee, has sought to introduce legislation that would place sanctions on participating foreign companies.

“A state sponsor of terrorism is poised to achieve a tremendous economic boon by entering the oil business and endangering US waters to boot,” the Republican congresswoman said this month.

“It is deeply disappointing that the Obama administration appears content to just watch that happen,” she added. Adding extra piquancy to the controversy is its timing: the Republican party’s Florida primary election take place on January 31.

The $750m platform is owned by Italian oil giant Eni’s offshore unit Saipem and assembled in China using less than 10 per cent of US technology to accommodate sanctions that also bar US companies from participating. It is contracted for at least six months.

A first consortium grouping Spain’s Repsol, Norway’s Norsk Hydro and India’s ONGC Videsh will drill two wells. A second consortium, made up of Malaysia’s Petronas and Russia’s Gazprom, will drill subsequent wells.

Despite the sanctions, Washington has engaged both with these foreign companies and the Cuban government after the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling recommended such co-operation to protect “fisheries, coastal tourism and other valuable US natural resources”.

US officials inspected the rig in Trinidad and Tobago this month before it left for Cuban waters, and in December held talks with Cuba, Mexico and the Bahamas in Nassau on emergency planning in the gulf. A second round of talks is scheduled for February.

Experts are divided on whether significant oil discoveries would spur or slow Cuban economic reforms.

“With or without oil, the Cuban economy sorely needs an environment in which businesses and individuals feel confident to invest,” said Arturo Lopez-Levy, a Cuban academic at the University of Denver.

But most agree the prospect has brought Havana and Washington closer as they look to safeguard their mutual economic and environmental interests.

“The meeting between US and Cuban officials on environmental co-operation … is an example of new bridges of communication, which if it wasn’t for oil and gas development would not have happened,” said Jorge Piñón, former president of Amoco Corporate Development Company Latin America and now a research fellow at Florida International University.

Just as “ping-pong diplomacy brought the US and China together, oil might very well bring Cuba and the US together”.

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US-Cuba policy, and the race for oil drilling

Posted on September 30, 2011 by Arch Ritter
By Sarah Stephens,Executive Director of the Center for Democracy in the Americas. Jake Colvin, Vice President for Global Trade Issues at the National Foreign Trade Council – 09/29/11 03:39 PM ET
.

To protect the national interest — and for the sake of Florida’s beaches and the Gulf of Mexico’s ecosystem — it is time to stop sticking our heels in the sand when it comes to U.S.-Cuba policy.

Before the end of the year, a Chinese-made drilling platform known as Scarabeo 9 is expected to arrive in the Gulf.  Once it is there, Cuba and its foreign partners, including Spain’s Repsol, will begin using it to drill for oil in waters deeper than Deepwater Horizon’s infamous Macondo well.  The massive rig, manufactured to comply with U.S.-content restrictions at a cost of $750 million, will cost Repsol and other companies $407,000 per day to lease for exploration.

They are taking this financial risk because Cuba needs the oil and its partners — Spain, Norway, Russia, India, Vietnam, Malaysia, Canada, Angola, Venezuela, and possibly China — believe that drilling in waters said to contain undiscovered reserves of approximately 5 billion barrels of oil is good business.

In virtually every other country in the world, developments like these would prompt high-level discussions about how to exploit these resources safely or to anticipate a crisis were a disaster to strike. Experts who have studied the currents say a spill in Cuban waters would send 90 percent of the oil into the Keys and up the East Coast of Florida. But the embargo leaves Florida’s sensitive coastal resources defenseless.

Due to the fact that the drilling involves Cuba, American companies and workers cannot lend their expertise to what could be a risky operation.  U.S. economic sanctions prevent our private sector from helping Cuba drill safely and paralyze the U.S. government, which ought to be convening bilateral discussions on best practices and coordinating disaster response.  In fact, the U.S. has no emergency response agreement with Cuba for oil spills.  While some specific licenses have been granted to permit U.S. firms to conduct limited transactions with Cuba, current sanctions bar the United States from deploying the kind of clean-up equipment, engineers, spare parts for blow-out prevention, chemical dispersants, and rigs to drill relief wells that would be needed to address an oil crisis involving Cuba.

One welcomed development came earlier this month, when William Reilly, a former head of the U.S. Environmental Protection Agency and co-chair of the Commission that investigated the Deepwater Horizon disaster, led a group of experts to Cuba to take a look at their plans.  While the administration has done well giving permission to Mr. Reilly, as well as to other experts, to discuss the problem with Cuban counterparts, it should move more aggressively to work with the Cuban government to cooperate on plans for safe drilling and responding to a possible crisis.

Rather than moving forward, some in the U.S. Congress would make the problem worse.  Rep. Ileana Ros-Lehtinen (FL-R), who criticized Mr. Reilly’s visit to Cuba as “giving credibility to the regime’s dangerous oil-drilling scheme,” has offered legislation to try and stop Repsol from drilling.  Rep. Vern Buchanan (FL-R) would deny Repsol the right to drill in U.S. waters if it helped Cuba drill in its waters.   Thirty-four members of both parties have written Repsol directly, threatening the company if it drills with Cuba.
Yet this tactic can’t work.  Even if they could deter Repsol from drilling – which is unlikely – they cannot stop Cuba and partners from countries like China, Russia, and Venezuela, from using the rig and searching for oil.

At some point, it is likely that drilling will begin and the United States ought to do what it can to prepare for that eventuality.  The U.S. government should facilitate access by Cuba and its drilling partners to the resources they need to drill safely.  President Obama should instruct the Treasury Department to issue a blanket general license now that would allow private industry to provide what oil expert Jorge Piñon calls ”any conceivable response” in the event of a crisis.

As we have already done with Mexico and Canada, the U.S. should join Cuba in crafting a crisis response agreement covering on-scene coordinators, a joint response team, response coordination centers, rapid notification protocols, customs and immigration procedures, and communications.  The plan should be written, signed, tested, and implemented as quickly as possible.

Earlier this year, the Deep Water Horizon Commission, which Mr. Reilly co-chaired, said in its final report “that neither BP nor the federal government was prepared to deal with a spill” of its magnitude or complexity; that industry and policy makers were lulled by a “culture of complacency” that resulted in 5 million barrels of oil being dumped into the Gulf.

Having seen this movie once before, complacency is inexcusable.  Politics should not blind Washington to the reality of the situation unfolding off of our shores.

Sarah Stephens is Executive Director of the Center for Democracy in the Americas.  Jake Colvin is Vice President for Global Trade Issues at the National Foreign Trade Council.

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Cuba’s Offshore Petroelum Exploration and U.S. Policy

Posted on September 28, 2011 by Arch Ritter
POLITICO: Cuba drilling next hurdle for U.S.
By: Darren Goode (Courtesy of Jorge R. Piñón)
September 27, 2011 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 months.”

“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 governments.

“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.

Hunt, who was following up on a trip he made to Cuba last year, said the biggest difference between the two trips is the Cuban government “had taken a great deal more investigation” into safety and other protocols adopted by the U.S. and Mexico.

“In a way, I would say in 2010 they had a very solid regulatory plan. In 2011, they had a fairly sophisticated regulatory plan,” Hunt said. “I don’t have too many concerns about their ability to drill safely.”

Reilly and former Royal Dutch Shell Vice President Richard Sears, the chief technical adviser to the president’s spill commission, were in Cuba to explain the commission’s recommendations and findings.

“Turned out they knew the oil spill commission’s recommendations cold,” said Reilly, who later briefed Bromwich and White House officials about the trip. “That was kind of surprising and reassuring. They are aware they have very serious challenges, as any country that’s never done this before should have.”

But for many, the main concern is that U.S. equipment and personnel would not be ready to act quickly enough to respond to a spill.

“What’s in place from the U.S. side to respond and basically prepare for a worst case or really a spill of any kind?” asked Dan Whittle, director of the Environmental Defense Fund’s Cuba program, who was also on this month’s five-day trip to Havana.

Because of the decades-old U.S. embargo against Cuba, Hunt said, many resources would have to be shipped from as far away as the North Sea, the United Kingdom, North Africa or Asia.

Reilly, Hunt and Whittle are among those asking the Obama administration to grant general licenses or narrow emergency exemptions to the embargo to ensure that U.S. companies of all stripes can assist in preventing and responding to a subsea well leak.

The Commerce Department and the Treasury Department’s Office of Foreign Assets Control have granted licenses to some U.S. companies that operate in Cuban waters, including those that could help with oil spill preparation and response. Both agencies promised to act quickly on any additional approvals that are required.

But some say granting a wider exemption is needed so that various companies — including parts manufacturers and vessel and plane operators — can respond quickly.

“It’s very complex, so the easiest way is to issue a general license and to make sure that the general license is only to be used during an emergency,” Piñón said. “There are hundreds of companies. We don’t know who is going to have that valve that is going to be needed.”

For example, well containment systems developed by the Marine Well Containment Co., a coalition of major Gulf oil producers that formed after last year’s spill, and the Helix Energy Solutions Group were instrumental in the Interior Department’s decision to start granting deepwater drilling permits again this year. Repsol has contracts with MWCC and Helix for their operations in U.S. waters, but not in Cuba.

Bromwich said he is not pressuring the Treasury to issue or not issue a general license to companies.

“It would be in the national interest to make sure that everything that can be done certainly in U.S. waters is done,” he said. “Whether it goes beyond that, I think, is among the issues that are being discussed in high levels of the government.”

Regular talks also continue with Repsol, Bromwich said.

But while Cuba appears willing to adopt offshore drilling standards modeled after those in the U.S. and Mexico, Piñón said there needs to be direct talks between the two governments.

While the embargo tightened during the George W. Bush administration, the Obama administration has loosened some sanctions, including easing specific travel restrictions in January.

One challenge will be the politics in Florida, which will again be a swing state in the 2012 election. The state includes critics of any oil or gas drilling near the state’s coastline, along with hard-line Cuban refugees who wince at any melting of relations with the Castro regime. Florida congressional members from both parties have offered bills punishing companies that operate in Cuba.

Republicans on Capitol Hill, and potentially on the presidential trail, could also accuse the Obama administration of focusing more on shoring up Cuba’s domestic energy production rather than at home.

But Florida political observers say any concern about fiddling with the embargo runs a distant second to the state’s economic doldrums and the devastating impact that a spill could have on the Sunshine State.

“It’s much more of an issue for the Republican candidates than it is for the administration,” said Florida Republican strategist Ana Navarro. “I frankly don’t think the administration cares about the hard-lined Cuban-American vote, and I don’t think the hard-lined Cuban-American vote cares for the administration. And I don’t think that’s changing anytime soon.”
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