Test oil drilling rig on way to Cuban waters, 90 miles from Florida Keys

Test oil drilling rig on way to Cuban waters, 90 miles from Florida Keys
By ERIC STAATS
Posted November 4, 2011 at 9 p.m.

Spanish oil giant Repsol could begin drilling in late December or early
January at a spot along the northern shore of Cuba about 90 miles from
Key West.

From there, the Gulf Stream could pick up any oil spill and carry it
perilously close or even into mangrove islands and onto beaches in the
Florida Keys, South Florida and up the U.S. east coast.

NAPLES — With an oil drilling rig on its way to Cuban waters from
Singapore, U.S. officials are trying to piece together a strategy for
what to do should a spill from the exploratory well threaten the Florida
coastline.

The job is complicated by diplomatic tensions between the United States
and Cuba and the domestic politics of the U.S. embargo of Cuba.

"They're proceeding cautiously, and in my opinion, a bit too
cautiously," said Daniel Whittle, senior attorney and Cuba Program
director at the Environmental Defense Fund.

The clock is ticking: Spanish oil giant Repsol could begin drilling in
late December or early January at a spot along the northern shore of
Cuba about 90 miles from Key West. From there, the Gulf Stream could
pick up any oil spill and carry it perilously close or even into
mangrove islands and onto beaches in the Florida Keys, South Florida and
up the U.S. east coast.

The Interior Department and U.S. Coast Guard have made the rounds of
House and Senate committees in the past few weeks to reassure lawmakers
that they are on the job _ even without Cuba at the table.

In talks with U.S. officials since February, Repsol has pledged that it
will adhere to U.S. drilling regulations while working in Cuba and has
agreed to allow the United States to inspect the rig before it enters
Cuban waters, the company and U.S. officials say.

U.S. regulators, though, have no enforcement power and the inspections
will not be as complete as they otherwise would be if they are conducted
at the drilling site, Michael Bromwich, director of the Interior
Department's Bureau of Safety and Environmental Enforcement, recently
told a House subcommittee.

About a dozen inspection points normally performed on U.S. rigs would be
skipped, including testing the blowout preventer and how well the rig is
secured in place, Bromwich said.

"It's a lot better than nothing at all, but it's no equivalent,"
Bromwich said.

He said Repsol has an incentive to cooperate with U.S. authorities to
protect extensive oil interests it has in the northern Gulf of Mexico.

Company spokesman Kristian Rix said Repsol is just being a "responsible
operator."

"We're happy to cooperate with U.S. authorities and pleased they've
taken a keen interest," Rix said.

U.S. Rep. David Rivera, R-Miami, is among a contingent of South Florida
lawmakers who say the Obama administration's work with Repsol is
inconsistent with U.S. policy toward Cuba.

The lawmakers, including Rivera, whose district includes eastern Collier
County, sent a letter to Obama this week asking that the Commerce
Department conduct its own inspection of the rig to be sure it complies
with U.S. trade laws.

The letter also requests "clarity" about how the United States is
applying embargo rules that prohibit the rig from having more than 10
percent U.S. parts.

The rig getting all the attention, the Scarabeo 9, is new — built in
China for an estimated $750 million for Italian company Saipem, said Lee
Hunt, president of the International Association of Drilling Contractors.

"It's a modern, even ultra-modern, rig really," Hunt said, noting that a
half-dozen similar rigs already are working in the field and have a good
safety record.

Still, the Deepwater Horizon spill in the northern Gulf of Mexico was a
wakeup call that deepwater drilling is inherently risky, said Whittle,
with the Environmental Defense Fund.

With friendlier countries, such as Mexico and Canada, the United States
has detailed agreements about how they will coordinate responses to oil
spills that threaten international borders.

Whittle said the United States needs a similar protocol with Cuba,
mirroring agreements by which the National Hurricane Center works with
Cuban forecasters and sends hurricane hunter aircraft into Cuban airspace.

While talks with Repsol are good, it is no substitute for direct talks
with Cuba, he said. Until then, he said, the United States remains
unprepared to deal with a spill in Cuban waters.

U.S. authorities have overseen tabletop oil spill response exercises at
Repsol's offices in Trinidad and, in the United States, are working with
state and local agencies on contingency plans, Bromwich said.
Photo with no caption
Quotable

"They have plans and you know, you just hope that they've put in all the
safeguards they need and it doesn't happen," Gov. Rick Scott told the
Naples Daily News editorial board.

In an interview with the Naples Daily News editorial board in October,
Florida Gov. Rick Scott said drilling off Cuba is Florida's "biggest
risk" for a spill. He said he has met with the Coast Guard to discuss
response plans.

"They have plans and you know, you just hope that they've put in all the
safeguards they need and it doesn't happen," Scott said.

U.S. Coast Guard Vice Admiral Brian Salerno told the House subcommittee
this week that the Seventh District in Miami will conduct another spill
response exercise later this month.

The Treasury and Commerce departments are issuing licenses to U.S.
companies to allow them to contract with Repsol to provide equipment to
respond to any spill despite the Cuban trade embargo.

Critics say the licensing process is too cumbersome and that the federal
government should instead issue so-called "general licenses" that can be
issued more quickly and with less red tape.

Bromwich told the House subcommittee that he has a "high level of
confidence" that the necessary licenses will be in place when drilling
starts off Cuba.

"I think we're at a pretty good place right now to get everything that's
needed," he said.

Data from the Treasury and Commerce departments about the numbers of
licenses issued and to which companies wasn't immediately available.A
Fort Lauderdale-based oil spill response group, Clean Caribbean and
Americas, has made no secret of its license to provide equipment to
contain a spill.

Another company, Houston-based Wild Well Control, also has been issued a
license to send equipment that would cap a leaking well, but the capping
stack is in Scotland and could take days to get to Cuba, said Hunt, of
the drilling contractors association.

Hunt said another oil spill response contractor based in Houston, Helix
Energy Solutions, has applied for a license to provide similar equipment.

Oil industry expert Jorge Piñon said it is naïve to think that a handful
of licenses will be adequate to respond to a Cuban oil spill. He said
general licenses are "urgently needed."

Piñon, a former oil company executive and visiting research fellow at
the Cuban Research Institute at Florida International University, said
his concerns about drilling in Cuban waters reach beyond Repsol.

When Scarabeo 9 is finished at the Repsol tract, it will be moved to its
next job at the site of another new well in Cuban waters planned by
Petronas, the state-run oil company of Malaysia.

"We don't even have a phone number for somebody to call at Petronas,"
Piñon said. "That to me is totally unacceptable."

http://www.naplesnews.com/news/2011/nov/04/cuban-waters-test-oil-rig-florida-keys-US-monitor/