MEO Australia has entered the Cuban oil and gas sector. MEO Australia and state-owned oil company Cuba Petróleo Union (CUPET) executed the Cuba Block 9 Production Sharing Contract (PSC) in a ceremony in Havana, Cuba on September 3.
The Block 9 PSC is a hydrocarbon-rich region with multiple nearby discoveries, including the multi-billion barrel Varadero oil field. Block 9 contains the Motembo field, the first oil field discovered in Cuba.
Cuba currently produces approximately 80,000 barrels per day, which is about 50 percent of the country’s oil consumption. CUPET produces the majority of the island’s oil and Canada’s Sherritt International is the only foreign producer.
In 2014, Cuba passed the Foreign Investment Act to encourage new investment which set corporate taxes rate between 15 and 22 percent and an eight-year tax exemption for new investors.
MEO has been in discussions with CUPET since prequalifying as an onshore and shallow water operator in early 2013. Block 9 was MEO’s preferred entry block due to the confirmed presence of hydrocarbons and the close proximity to existing production and infrastructure.
MEO Australia is an Australian Stock Exchange listed, independent oil and gas company that has a portfolio of exploration, appraisal and development stage opportunities in Cuba, New Zealand and, on Australia’s North West Shelf, the Ashmore Cartier and Bonaparte Gulf regions.
Block 9 lies on Cuba’s north coast and covers around 2,380 square kilometers.