April 11 (UPI) -- The preliminary steps toward drilling into an oil basin in Cuba are underway in a project that could draw international interest, an Australian company said.
Melbana Energy, an Australian exploration and production, is one of the few foreign companies with a footprint in the Cuban oil sector. Melbana's Alameda-1 prospect near the northern coast of Cuba is targeting a reservoir with more than 2.5 billion barrels of oil in place. The company estimates it would cost at least $20 million to drill two wells in Cuba, higher than previous estimates.
The company said Wednesday it completed a tender for a drilling rig that could be deployed later this year. Bids are under review while it looks for outside partners to buy into its Cuban portfolio.
Offshore, Melbana said it's examining an oil opportunity in the Santa Cruz basin off the northern Cuban shore. A technical team is working to develop an initial work plan there.
"The company is considering a number of corporate business development initiatives," it stated. "Following recent marketing initiatives in the United Kingdom, it is apparent that there is considerable investment interest in Melbana's world class exploration portfolio."
The company in a share placement over the last quarter generated about $2.1 million in capital to use to fund operations in Cuba, as well as those closer to home at its Beehive prospect in New Zealand.
Melbana's partnership agreement with Petro Australis Ltd. fell apart last year because of the lack of approval from regulatory authorities, leaving it with a 100 percent stake in Cuban operations and without a partner that would carry 40 percent of the drilling costs.
The company changed its name last year from MEO Australia to adopt a moniker with a more Cuban flare.