KINGSTON–The turquoise waters that have long brought treasure seekers to the Caribbean now are drawing a new kind of explorer as countries across the region increasingly open their seas to oil exploration.From the Bahamas and Cuba down to Aruba and Suriname, international oil companies are lining up to locate potentially rich offshore deposits in the Caribbean. The countries hope drilling could lead to a black-gold bonanza, easing demand for imported oil and diversifying their economies.
It's a long-standing dream for many. As the Dominican songwriter Juan Luis Guerra once sang, "If petroleum sprang from here, oh but there would be light and hope."
So far, the twin-island nation of T&T is the only major hydrocarbons producer in the Caribbean, and its waters are crowded with offshore platforms. The country sits just about seven miles (11 kilometres) off the coast of Venezuela, which has the world's largest proven oil reserves. It's pushing hard into deep-water drilling and has signed production-sharing contracts with British oil company BP for new exploration blocks.A growing number of other Caribbean nations are also authorising or at least aggressively pursuing offshore exploration.
The Bahamas recently announced it would try offshore exploratory drilling and said it should have enough information by late 2014 to decide whether it can move forward with production. A voter referendum would first have to decide the matter.
Bahamas Petroleum Company CEO Simon Potter said a rig will drill to subsea depths of roughly 22,000 feet (6,705 metres) in some 1,600 feet (488 metres) of water adjacent to Cuba's offshore territory.Barbados and Jamaica have also been seeking well exploration in their seas, while the Anglo-Dutch group Shell announced in December it was preparing to sink its third offshore well in nearby French Guiana, an overseas French department, with other companies also exploring in deep waters there.
"What once was a trickle is fast becoming a stream in the Caribbean, with new announcements of expanding deep-water exploration lease offerings and drilling permits being issued," said Lee Hunt, a Houston-based consultant who retired last year as the long-time president of the International Association of Drilling Contractors.The push for exploration has been fed partly by worries that Venezuelan President Hugo Chavez's nearly two-year-long cancer fight and March 5 death would affect a Venezuelan aid programme called PetroCaribe that sells petroleum to 17 Caribbean countries on preferential terms.
PetroCaribe provided US$14 billion worth of Venezuelan oil to the region last year, with Cuba being the principal beneficiary. Chavez's successor Nicolas Maduro hasn't said he would stop the aid, but his challenger in April 14 elections, Gov Henrique Capriles, has pledged to cut off subsidised oil to Cuba and re-evaluate the PetroCaribe programme if elected.Keeping the oil flowing is crucial. Caribbean countries generate nearly all their power from imported oil although the region is blessed with solar, wind and other alternative energy opportunities.
Nonetheless, many people across the region fear their famed clear water, fringing reefs and white-sand beaches could end up a casualty to any future oil boom, threatening the tourism bonanza that many countries already depend on. Even with the possibility of a windfall still distant, regional officials have begun to discuss how they would co-operate in the event of a major accident, such as the 2010 Deepwater Horizon oil spill in the Gulf of Mexico.
Ocean currents practically assure that a big spill in one Caribbean nation would significantly affect neighbours, possibly even the US East Coast. Many Gulf communities are still recovering from the Deepwater Horizon accident, the country's largest offshore oil spill.
Adding to complications, the overall Caribbean region, with the exception of T&T, is still an uncertain frontier for offshore oil and gas, said Jorge R Pinon, a Latin America and Caribbean energy expert at the University of Texas in Austin.
Cuba, for example, authorised exploratory drilling for ultra-deep deposits estimated to hold five billion to nine billion barrels of oil, but its dreams were put on hold last year when three initial exploratory wells were unsuccessful and the massive platform that drilled them sailed away, with no scheduled return date.Such doubts, however, have mostly been cast aside in the face of oil prices topping US$100 a barrel. And Caribbean governments are trying hard to lure more oil companies to take the expensive gamble of dispatching offshore drilling rigs, which can cost up to US$500,000 per day to operate.
In Guyana and Suriname, officials are busy licencing deals and offering concessions in a long-ignored basin the US Geological Survey last year estimated to have "significant undiscovered conventional oil potential."Exploratory drilling in deep waters has already begun off Guyana, where last year an international consortium moved to cap a high-pressure well at a subsea depth of 16,000 feet (4,876) metres over safety concerns. Several oil companies still believe the area is promising, and Spanish energy company Repsol and the UK's Tullow Oil PLC are negotiating new licences, according to Guyana Natural Resources Minister Robert Persaud. Exploratory wells also were sunk last year in waters off the Caribbean coast of Colombia.With so many countries hoping to strike it rich, Hunt forecasts interest by major oil companies only will be growing. (AP)