Cuba, the world’s sixth largest nickel producer and one of the top 10 nickel mining countries, is experiencing a sudden, but still modest, investment rush triggered by an ongoing reconciliation between the Caribbean nation and the U.S.
The country, which also holds significant deposits of other minerals as well as oil, has 246 projects hoping to attract capital and be developed, according to a new U.S. Geological Survey report published earlier this month.
“Cuba’s geology is complex, and the country has a variety of mineral commodity and energy resources,” said Steven Fortier, Director of the USGS National Minerals Information Centre.
While mineral production is largely state-controlled, the government has taken steps to change its old mining laws.
As a result, Canadians companies already have a presence in Cuba’s mining sector. One of them is Calgary-based miner Sherritt International (TSX: S), the Latin American country’s largest foreign investor, with nickel mining, oil-and-gas and electricity interests.
The ore the Toronto-based firm extracts there — under a joint venture with the country’s government — is refined in Fort Saskatchewan, Alberta, but because of the U.S. embargo, none of that refined nickel is allowed south of the border.
Despite such barrier, the USGS report shows that nickel remains one of the country’s main sources of foreign income, along with tourism.
It also highlights a value increase for the country’s industrial manufacturing sector, which jumped 88% between 1993 and 2013. However, the sector’s share in the GDP decreased by 3% percent during the same period reflecting economic growth in other sectors of the economy.
Oil and industrial minerals
Industrial minerals and manufactured industrial mineral products produced in Cuba include ammonia and ammonia by-products, bentonite, cement, feldspar, high-purity zeolite minerals, gypsum, kaolin (a type of clay), lime, high-grade limestone, marble, sand, sulphuric acid, steel and urea. In 2013, an estimated 4,500 metric tons of zeolites was exported neighbouring Latin American countries and Europe. Last year Cuba exported the majority of its ammonium nitrate, the USGS report shows.
In terms of oil reserves, the body released an assessment in 2004 that estimated the total amount of undiscovered technically recoverable resources at 9.8 trillion cubic feet of undiscovered natural gas, 4.6 billion barrels of crude oil, and 0.9 billion barrels of natural gas liquids.
The full report “Recent trends in Cuba’s mining and petroleum extraction industries” is available here.