Cuba and Sherritt of Canada Sign Deal to Increase Oil Production

June 2, 2014 | Print Print |

Fernando Ravsberg*

HAVANA TIMES – The Canadian company Sherritt announced Monday the signing of a new contract with Cuban authorities for joint venture drilling and production of oil and gas for 10 years, extendable to 2028.

pozo-de-petroleoThe agreement allows drilling in the area of Puerto Escondido, 45 miles (70 kms.) east of Havana, increasing the number of existing wells with 7 new ones, which will operate for the next 2 years.

Sherritt’s president, David Pathe, said “after two decades in the country, we have developed a great relationship with the government of Cuba.” He added, “We are very pleased to announce this expansion.”

Sherritt is the largest foreign oil producer in Cuba, supplying more than 20 thousand barrels per day. The Canadian company also has major contracts in Cuba for the extraction and refining of nickel and its derivatives.

The company’s executives have suffered reprisals from Washington for its economic relationship with Cuba, including being denied entry to the USA.
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(*) Visit Fernando Ravsberg’s blog.


What's your opinion?

  • Griffin

    The nickel mine which Sherrit works at Moa, was previously worked by the Russians. The Soviets operated it for Cuba after it was expropriated by the Revolution from an American corporation who had developed the mine. For this reason, the US government regards Sherrit as receiving stolen property. This is why Sherrits executives are banned from entering the US.

    • emagicmtman

      …”the U.S. government regards Sherrit as receiving stolen property.” Hmmm! What is OUR oil (or nickel, etc.) doing under THEIR land? For the answer, note both British and U.S. interventions, for example, in Cuba and Iran–which resulted in a bit of “blowback,” however!

      • Griffin

        Not the nickel deposits; the capital investment in the mine in the form of buildings, roads, machinery, smelter & etc. The US firm was paying royalties to the Cuban government for the nickel they were extracting, and paying Cuban workers good salaries. If the Cuban government wanted to increase the royalties paid, that’s fine and part of the normal business negotiations. But the Castros seized the entire operation without paying any compensation. That is theft. That Castro wrote a decree and declared it law, does not make it legal. Under the Cuban constitution of 1940, which was still valid and which Castro has pledged to uphold, the seizure of private property without compensation was illegal.

        • emagicmtman

          you seem to have forgotten some minor points, such as the U.S. backing of the counter-revolutionaries beginning almost immediately after the triumph of the Revolution, the U.S. backing of the mercenaries who landed at Playa Giron, the U.S. diktat to its oil companies NOT to refine Soviet oil which Cuba purchased, the 500+ plots to kill Fidel, the numerous terror attacks, like the bombing of the Belgian ship El Cobre (and then the second bomb, which killed many of the first responders!) etc. etc. Cuba was completely justified in siezing all assets of the American companies! We did the same with German assets after Pearl Harbor!

          • Griffin

            I’m not forgetting those things at all. There was an escalating tit-for-tat between Havana & Washington.

            You are forgetting the dates of these events. Cause precedes effect, and so it is significant to note that the expropriation of US property in Cuba preceded the Bay of Pigs invasion. Therefore, you are absurd to argue that the Cuban government nationalized US assets because of the Bay of Pigs.

            December 31, 1958: Batista flees Cuba

            January 7, 1959: US recognizes new Cuba government headed by provisional president Manuel Urrutia, (although everybody knew that Fidel was the real power).

            May, 1959: The Revolution began seizing privately owned land. The Escambray Rebellion began shortly after this and involved mostly former allies of Castro who were disillusioned by the growing presence of Communists in the Revolutionary government, plus some former Batista supporters. Although the CIA initially provided some aid to the insurgents, it withdrew all support after the failed Bay of Pigs invasion in 1961. With the help of Soviet military advisors, the rebellion was exterminated by 1965.

            Feb. 1960: Russia & Cuba sign trade deal for oil & sugar.

            4 March 1960: La Coubre ship explodes. Workers were unloading explosive ordnance directly onto the dock contrary to port regulations and established safety regulations. The ship was carrying munitions, and therefore secondary explosions will occur as the cargo is cooked off in the fire of the first explosion. The US has denied any involvement in the alleged bombing of this ship.

            June 1960: US refineries refuse to process Russian oil. Castro seizes the refineries.

            August 1960, the Cuban government seized all US owned property, including the Moa mine.

            By end of 1960: Cuban government had seized over $25 billion in Cuban owned private property.

            April 16, 1961: Fidel declares the Socialist character of the Cuban Revolution.

            April 17, 1961: Bay of Pigs invasion lands in Cuba.

            The plots to kill Fidel came after that (although the number of plots is disputed, as the regime liked to inflate the numbers for propaganda).

            And of course, we have Fidel Castro’s own words that it was his intention all along to seize private property and turn Cuba into a Marxist communist state. He knew what he was doing by gradually raising the tension with the US, while coaxing the USSR into closer economic & military support for his revolution. Fidel was a brilliant strategist.

          • emagicmtman

            Too many falsehoods above. Just one, that the El Coubre explosion was caused by the negligence of the stevadores. In reality, counter-revolutionary elements drove up a garbage compacting truck filled with explosives, which were then detonated. Bay of Pigs invaders were made up of many former Batista thugs. Eisenhower and the Hermanos Dulles began planning for the Revolution’s overthrow in January, 1959, as many sources readily confirm. Where do you get your “cut and paste” mis-“fact sheet?” from the Cuban National Foundation or the C.I.A.?

          • Griffin

            Batista’s men were banned from the Bay of Pigs recruits. However, Castro was able to get several of his loyal men into the group and thus knew all about it. I told you he was smart. You are correct, the planning for the Bay of Pigs began early, in April 1959. By then Eisenhower knew Castro was indeed a Communist. Eisenhower was no fool either.

            Do you have a link to any evidence supporting the garbage truck theory? Let’s consider the scenario: the ship docks port side with a full load of valuable munitions. The stevedores begin unloading. And all of this happens without a military cordon? No, there was a military cordon, because the reports listed soldiers among the dead. They let a garbage truck pull up? What garbage were they supposed to pick up at the wharf? The military cordon waved them through? You swallow that BS? How about an ice-cream truck or the Fuller Brush man?

            The evidence that La Coubre was tied at the wharf contrary to all marine safety regulations is uncontrovertibly true. For you to use the hackneyed phrase “a counter-revolutionary elements” betrays the fact you got your talking points straight from the Cuban propaganda mill. Normal people don’t talk like that.

            Some idiot lit a cigar, or the untrained rebels failed to properly ground the cargo before unloading it. Kaboom.

          • Dan

            Griffin, in most state’s criminal evidence codes there is what is called prior bad acts. If someone was caught robbing a bank 5xs before and they say when accused the 6th time that it wasn’t them, that evidence can sometimes come in. So we are to believe that the same people who bombed department stores, movie theaters (during a children’s matinee) airports and centrales, did not, I repeat not, detonate La Coubre, which the GOUSA had tried to dissuade from ever docking in Cuba ?

          • Griffin

            There were several violent groups in Cuba in those days who had engaged in bombing department stores, assassinations and other similar acts which could be called “terrorist”. The 26th July Movement, the DRE, and Batista’s secret police all employed violent methods. So the principle of prior bad acts applies to many people.

          • Carlyle MacDuff

            Eisenhower applied the first Cuban embargo on Cuba – he did not like Batista.

          • Carlyle MacDuff

            Remember that it was Germany that declared war on the US, not the reverse.
            The US applied enormous political pressure to France and the UK when they pursued their rights in Suez following Gammar Abdul Nasser nationalising the Canal in 1956. The US claimed that the joint French//British action.was imperialism, BUT – when three years later Castro did the same thing as Nasser but to US property the story was different.

  • Moses Patterson

    Let’s pause for a little perspective here. If the numbers reported here are correct, the fact that Sherritt supplies Cuba with 20,000 bbl/d puts this operation on par with a mom/pop refinery in Dickinson, North Dakota aptly named Dickinson Refinery. This refinery employs a handful of people located on 375 acres and has little economic impact even on the local community. The Castro propaganda machine would have you believe that this “mud hole” is a significant energy contributor. Simply not so.

    • Griffin

      I’ve seen the oil fields east of Havana & the decrepit Russian-built thermo-electric power plant which sits in the middle of it. The petroleum pumped up from these wells is thick, heavy and high in sulphur content. Sherritt would have to refine & upgrade the heavy crude to produce useable light oil. Or they will burn it as is to generate electricity, producing a huge amount of dark sooty acidified pollution, which is what Cuba has done with this oil for 40 years.

      This is not an example of a modern industry. This is bottom-of-the-barrel resource exploitation on the cheap.

  • 53latitude

    Great to see our two countries working together. Lots of business between my city of Edmonton and Havana.

  • CUBALIBRE

    Love all the same negative comments you see from the same old people… Ok its not changing the life of anyone in a day… But by all means this is at least something, a deal that could one day lead to more things to come… Sherritt may not be the biggest oil producer in the world, or even supplying Cuba with the most percentage of oil they receive…. I don’t think the Castro regime as some call it, was sitting in room going, well this deal is going to make us look good for the people, we are going to be popular now. NO… It is at least something, but I know nothing the Castro’s do will ever be seen as something to improve, again I agree there are thing to change in Cuba…. So no need to take a pause for a little perspective, no one is stating this will change Cuba!

    • Griffin

      You’re right this will not change Cuba at all. See my comment above: these investments are making things worse. The regime is repressing dissidents harder than ever. There were over 1120 political arrests in Cuba in May. Human rights conditions are getting worse, not better.

      http://www.abc.es/internacional/20140603/abci-cuba-informe-mayo-ddhh-201406021707.html

    • Moses Patterson

      In case you didn’t notice, the Cuban economy is in a freefall and due to negative demographics, in 20 years Cuba will have more old people than young people to take care of them. The Castros, despite rumors to the contrary, will not live forever and if ever one of Fidel Castro legendary ‘Hail Mary’ harebrained schemes was needed, now is the time. This is no time for baby steps. So if this latest deal, like the Mariel Port, like the moringa and whatever else will not change Cuba, what will?

  • Griffin

    To those who argue this kind of investment from foreign corporations is somehow going to help improve the life of the Cuba people, consider this:

    Repression Up As Flood Of Cash Inundates Cuba

    “All of these lifelines rolling in to the Castro regime have had a noticeable effect: A harder state hand against Cuba’s beleaguered democracy campaigners.”

    Read More At Investor’s Business Daily: http://news.investors.com/ibd-editorials/060214-703096-a-flood-of-cash-only-makes-the-cuban-regime-more-repressive.htm#ixzz33b2wvklz

  • LAWRENCE GATES

    IT WILL BE THE SHRRITT COMPANY THAT FINDS ALL OF CUBAS HIDDEN RESERVES WITH THE HELP OF A CANADIAN IN 2015 .MARK THESE WORDS ON A CALENDAR,

    • Griffin

      Sherritt is not drilling offshore. They are drilling in the well known oil field east of Havana. Maybe going to try some fracking!

    • Moses Patterson

      The ‘reserves’ are not hidden. Each of the five exploration ventures found Cuban oil. The problem is that the oil they found was low-grade and difficult to extract. Ironically, the US possesses the best technology available to extract this low quality crude. Sherritt does not have the open sea rig available to drill for this oil now nor in 2015.