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Australia’s oil company Melbana Energy Limited said on Tuesday that its plans for a potential accelerated drilling program in Cuba are maturing, and that it is hoping to finalize well proposals by the end of the first quarter next year.
Melbana Energy, - the new name of MEO Australia Limited since November 3, 2016 – plans to speed up drilling in Block 9 in Cuba, encouraged by the prospect resources identified in that area, the company said.
The Australian firm has also been assessing the regulatory and operating environment in Cuba. Following talks with Cuban and international service providers, Melbana reckons that “good quality equipment and contractors are available for drilling in Block 9”.
International operators are reporting that Cuba’s operating cost is around US$7 per barrel, the company said, adding that this is a globally competitive cost.
In a press release in November, Melbana said it had estimated that the first of three identified oil plays on Block 9 contain exploration potential for 8.183 billion barrels of oil-in-place with a prospective (recoverable) resource of 395 million barrels of potentially high-quality light oil.
(Click to enlarge)
Source: Melbana Energy
Cuba currently produces around 45,000 barrels per day of oil and some 100 million standard cubic feet per day of gas, Melbana said in today’s statement.
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Despite the fact that it has total undiscovered technically recoverable reserves of 4.6 billion barrels of crude oil, 9.8 trillion cubic feet of natural gas and 900 million barrels of natural gas liquids - based on 2004 estimates by the United States Geological Survey (USGS) – Cuba has not been great at luring foreign investors to its fields. With one exception: Melbana.
The Australian firm also sees itself as a direct beneficiary of the U.S. further easing sanctions against Cuba.
“The ongoing easing of U.S. Government restrictions on business dealings with Cuba is clearly a positive step for MEO considering the Company’s Block 9 PSC project and other potential business activities in Cuba,” the company said in October, when it was still named MEO.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.