Thursday, May 6, 2010

The rig will be Chinese

Reuters reports that Repsol is having a rig built in safety-conscious communist China for use when it returns to drilling in Cuba’s Gulf waters.

While the popular rumor of Chinese companies drilling in those waters may not pan out, with Chinese flags atop rigs a stone’s throw from Florida, it looks like the next rig that operates there will be of Chinese manufacture. Why source the job to China, as opposed to the nearby U.S. Gulf coast oil industry? U.S. economic sanctions prevent American companies from selling equipment for use in Cuba.

So if the thing ever goes operational and there’s a problem with the rig, or a spill, the scenario will not only be that American officials will be trying to make contact with Cuban officials for the first time, but the operator may also be trying to FedEx the needed parts from, say, Shanghai.


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