In this exclusive interview, Petro Australis Energy discusses its experience collaborating with CUPET...
What has been your experience working with CUPET, the national oil company of Cuba, in developing oil production in the country?
PAE personnel have successfully worked in countries all over the world and with many national oil companies. We have found CUPET to be world class in terms of their professionalism and integrity. Their people are technically, commercially and operationally very astute. My view is that the real measure of a good relationship with an NOC is how often you need to debate terms of the contract, and we almost never have to do that. When issues arise, we discuss them in a collaborative manner, and we do what is sensible to meet the needs of both parties.
What are the main challenges Petro Australis Energy has faced while operating in Cuba since 2018, and how have you overcome them?
Obviously, the US Sanctions create constraints on how business can be done in Cuba. However, we comply with them, mainly by not employing people subject to US jurisdiction.Also, the Cuban economy has been having difficulties post Covid. Again, we work closely with Cupet and other relevant Cuban government bodies to ensure the impacts of this are minimised.
Petro Australis Energy holds a 100% interest in three Production Sharing Contracts (PSCs) in Cuba’s central basin. Could you share more details on the results and future prospects of these projects?
The Petro Australis group have been involved in Cuba since early 2012, understanding the geology and getting to know the Cuban business environment. We were initially attracted by the incredibly prolific oil-prone petroleum system in Cuba as well as the fact that U.S. sanctions meant there was very little competition for exploration and production opportunities. The Central Basin contains several known and producing medium to light oil fields and PAE holds contracts covering two of these, the Pina and Brujo oil fields, plus a very significant surrounding exploration acreage position. Given that all of PAEs block are onshore and the fields are shallow with existing infrastructure, the capital and operating costs per barrel are world class. PAE’s current focus is on growing production at the Pina Field where there is existing production and infrastructure. PAE's plan is to grow production at the Pina Field to over 30,000 barrels of oil per day within the next three years.PAE is currently executing a 3-well development drilling programme at the Pina field, we will soon be fracture stimulating these wells and expect production of at least 1,000 barrels of oil a day from the 3 wells starting early 2025. If this drilling campaign is successful, PAE will bring in its own rigs to the country and beginning a drilling campaign of more than 100 wells.
How has Cuba’s domestic oil demand influenced Petro Australis Energy's production strategy, and what impact do you expect to have in reducing the country’s reliance on imports?
Cuba wants domestic oil production to meet local demand. So, unlike many other countries around the world, Cuba is very supportive of foreign oil companies investing In the country. Success at PAEs Pina Project would go a long way to meeting Cuba’s domestic oil demand.Note that PA will likely be relying on export to commercialise its share of the produced oil.
What business or investment opportunities do you see emerging in Cuba’s oil sector, and how can other foreign companies potentially benefit from them?
PAE believes there are many opportunities for oil-focussed upstream, midstream and service companies in Cuba.
What advice would you give to other companies interested in investing in Cuba, based on your experience in building and maintaining strong relationships with Cuban authorities and local partners?
I would advise other companies to have a close look at opportunities in Cuba as well as to understand the US sanctions on the country. I think they would see that there are many opportunities there and a really collaborative environment offered by the Cuban authorities.
