The republic of Cuba is one of the few remaining world-class, yet largely unexploited hydrocarbon systems. The Company sees clear first move opportunity for a quoted oil and gas company to counter cyclically deploy its operational skill and access to capital in a country which has been starved of investment and technology and impacted by US sanctions.

Cuba currently produces approximately 45,000 bopd of mostly heavy oil with c. 100 mscf/d of gas with clear targets for growth in their E&P sector to fuel electricity generation in the country which currently often experiences black outs. Cuba has the advantage of offering an international investor access to good infrastructure and an educated workforce alongside significant under exploited hydrocarbon resource potential. To promote international investment, Cuba enacted a new law in 2014 to offer protections to foreign investors, allowing payments in foreign currency and withdrawal of funds from the country. Cuba currently offers excellent fiscal and commercial terms for oil and gas operators, including nil cost entries into PSCs and the right to sell all crude at the wellhead priced in foreign currency, thereby securing oil commercialisation.

The Company has identified and taken steps in seeking to secure counter cyclically, a portfolio of onshore assets in Cuba with significant potential.  This targeted portfolio is primarily low-cost barrels with a blend of development, appraisal and exploration potential, representing a balance of opportunities across the cycle, with selective mining assets also being considered.