By CARMEN GENTILE
UPI Energy Correspondent
MIAMI, Dec. 19 (UPI) — A Soviet-era oil refinery in Cuba is getting back online with the help of the communist island’s close regional ally and petroleum benefactor, Venezuela.

Later this week Venezuelan President Hugo Chavez is scheduled to arrive in Cuba for the grand reopening of the Camilo Cienfuegos refinery, a relic of the former Soviet Union’s sway over Cuba until its demise in the late 1980s.

The refinery has been dormant since then, though with the help of Venezuela and some $136 million in repairs funded by Caracas, the plant is expected to go online Friday, according to Cuban state media.

The plant will reportedly be able to process some 65,000 barrels a day. Venezuela meanwhile sends about 100,000 bpd to Cuba as a discounted price, part of Chavez’s Petrocaribe agreement for Caribbean nations.

Cuban officials have lauded the return of operations at Camilo Cienfuegos, though some speculate that the plant may still need more work before becoming fully operational because of its longtime dormancy.

“It was a mess, that refinery,” said Larry Birns, director of the Council on Hemispheric Affairs in Washington and noted expert on Cuba.

Chavez is an ardent supporter of improving Cuba’s oil-producing capacity in light of much international speculation about the island’s potential offshore petroleum reserves.

So far, five international oil companies have paid reserve fees to the Cuban government to secure exploration rights there.

Last year, during the Non-Aligned Movement Summit in Havana, the leftist Chavez said that Cuba’s potentially lucrative offshore oil reserves could one day catapult the island onto the world petroleum stage and maybe even earn the country a place in the Organization of Petroleum Exporting Countries.

“Fidel is headed for OPEC,” said Chavez jokingly during the meeting drawing representatives from 118 countries and more than 50 world leaders. “He is finding oil.”

Though it seems unlikely that Cuba would be invited into OPEC based solely on speculation about what might reside beneath its ocean floors, there are indications that its offshore deposits are the world’s next great untapped source of oil.

According to the U.S. Geological Survey, some 4.6 billion barrels of crude oil and 9.8 trillion cubic feet of natural gas may well be lurking below the ocean floor of the Northern Cuban basin. The reserves are said to possibly rival the estimated reserves in Alaska’s Arctic National Wildlife Refuge.

That kind of crude would more than meet Cuba’s daily oil intake — about 205,000 bpd — and provide enough excess to transform the country from being dependent on Chavez’s largesse to a global player on the oil market.

Several nations are already banking on Cuba’s oil potential. China has invested an estimated $1 billion in Cuba with the intention of exploring its offshore deposits. Last week India’s state-run oil company penned a deal with Cuba to explore off shore as well.

Some analysts are skeptical about the hype surrounding the supposed untapped oil wealth that could springboard Cuba from impoverished communist state to self-sufficiency and financial windfall.

“It’s been a big smoke screen for a long time … the Soviets used to say there were large deposits off the shores of Cuba, though it hasn’t been proven,” Maurcio Claver-Carone, a member of the U.S.-Cuba Democracy Political Action Committee, told UPI.

Claver-Carone also contends that Castro used the basin as a means of promoting foreign investment in Cubapetroleo, Cuba’s state-owned oil company.