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11/03/09 - AFP (Paris) - Cuba, Russia sign first post-Soviet oil deal

HAVANA - Cuba and Russia signed an agreement Monday to allow Russian state
oil company Zarubezhneft to explore for and produce oil in Cuba in their
first post-Soviet oil pact.

"The contracts that were signed are tremendously important for Russia and
Cuba, since they will guarantee cooperation over the next 25 years," said
Nikolai Brunich, a Zarubezhneft official after inking the deal with the head
of Cuba's state oil company Cubapetroleo (CUPET), Fidel Rivero.

Cuban authorities announced in October 2008 that Cuba had crude reserves of
21 billion barrels - more than double previous estimates.

A major Cuban oil find would be a tropical Cinderella story for the only
communist country in the Americas.

An oil importer that relies heavily on oil-rich Venezuela for economic and
political support, Cuba's communist regime would be able to sustain itself
indefinitely if it were to become energy independent.

The country's centrally planned economy is frail, and its population of over
11 million is eager for economic progress after surviving dire economic
hardship since 1990.

Zarubezhneft is among those eyeing Cuba's economic zone in the Gulf of
Mexico.

At least seven foreign companies - from Spain, India, Norway, Malaysia,
Vietnam, Venezuela and Brazil - are currently working in the zone under
contract. US firms are sidelined by the US economic embargo on Cuba, in
place since 1962.

Moscow was Havana's main sponsor in the Soviet era, but relations between
the two countries stalled after the collapse of the former Soviet Union in
1991.

But both countries have made a push to revive ties in recent months with
Russian President Dmitry Medvedev visiting Havana last year and Cuban
President Raul Castro traveling to Moscow in January.