Petrobras, Cupet Sign Joint Oil Exploration and Production Agreement
Posted on: Monday, 3 November 2008, 09:00 CST
Petrobras and Companhia Cubana de Petroleo have signed a joint oil exploration and production agreement for Block 37 in the Cuban Sea, in the Varadeiro region offshore northern Cuba.
The agreement is the outcome of negotiations between the two companies and is expected to be in effect for 32 years, seven for exploration and 25 for production.
Block 37 covers an area of 1,600sqkm. It is between three and 12km off the coast, and at depths ranging from 500m to 1,600m. The block is located near the Cuban onshore oil reserves.
The exploration phase will be divided into four periods planned to last 18 to 24 months each. At the end of each period, Petrobras can assess whether or not it will remain in the deal. The initial investment will be $8 million.
In the event reserves are discovered, Companhia Cubana de Petroleo (Cupet) will have the option to participate by paying for past and future investments in field exploration, development and production.
Source: Datamonitor
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