Cuba and Russia Sign MoU for Russian Oil Majors to Develop Cuba’s Offshore Shelf

On June 18, 2014, Rafael Tenreiro Perez, head of the exploration department of Cuba’s Union CubaPetroleo, disclosed the signing of several memorandums of mutual understanding with Rosneft and Zarubezhneft (two of Russia’s leading oil majors).  These agreements are for the joint development of Cuba’s offshore shelf.  Mr. Perez noted, “I am almost sure of signing new contracts with other Russian companies” and that Cuba plans to start work on three offshore projects at 7,000 km well depths.  It is worth noting the new strategic significance of offshore drilling rigs that has been emphasized by Chinese behavior in disputed waters off of Vietnam (where a drilling rig was accompanied by a flotilla of 80 ships, when deposited by state-owned China National Offshore Oil Corp.) and in comments by the CEO of that company, when he stated before an internal corporate audience that the company’s “large-scale deep-water rigs are our mobile national territory and a strategic weapon.”

In July, it was reported that Russia had forgiven $32 billion in Cuban debt.  There are several strategic interests that Russia may be advancing in doing so, including: obtaining a berth for Russia’s fleet at the new port facility of Mariel; gaining approval and support for placing a new space tracking station in Cuba (which could double as a listening station); and additional support for the exploration projects being conducted by Rosneft and Zarubezhneft offshore Cuba.