by Jeff Fick | Dow Jones Newswires  

The Cuban government expects to sign an oil exploration deal with Brazilian state-run energy giant Petroleo Brasileiro (PBR), or Petrobras, later this year, the president of Cuba’s state-owned oil company told the Estado news agency Tuesday.

“We are in the concluding phase of a deal. We hope to announce something in coming months,” said Fidel Rivero, president of Cuba’s Cupet.

Current talks are aimed at hammering out exploration conditions and rates of return, Rivero said.

“Certainly we will sign an exploration contract with Petrobras yet this year,” Minister of Basic Industries Yadira Garcia Vera told Estado.

According to Vera, Cuba wants a deal that will also transfer technology needed to explore and develop deepwater oil reserves in the Gulf of Mexico. In addition, Cuba is negotiating the construction of a Petrobras lubricant plant, which will end the island nation’s need to import the products from Europe.

Cuba has proof that an immense reserve holding billions of barrels of crude exists in the Gulf of Mexico off Cuba’s shores, Rivero said. The deal with Petrobras will likely include rights to one of the most promising blocks, the executive added.

“We are going to change the history of the island,” Rivero said.

Petrobras has had some success in the ultra-deep waters of the Gulf of Mexico. In May, the company said that the Stones-3 exploration well confirmed the presence of oil and natural gas in the WR 508 block, about 200 miles off the coast of Louisiana. Petrobras holds a 25% stake in the exploration block.