This week, Secretary of the Interior, Sally Jewell, and Bureau of
Ocean Energy Management Acting Director, Walter Cruickshank, announced that the
first three oil and gas leases in the Gulf of Mexico boundary area have been
awarded, subject to the United States-Mexico Transboundary Hydrocarbons
Agreement.
Part of President Obama’s strategy to expand safe, responsible
domestic energy production, the Transboundary Agreement takes away the uncertainty
of the development of Gulf of Mexico transboundary resources. Because of this Agreement, approximately 1.5
million acres of the U.S. Outer Continental Shelf are more accessible for
production and exploration; in fact, estimates indicate that the area may
contain as much as 170 million barrels of oil (or more), and over 300 billion
cubic feet of natural gas.
Said Jewel, “With the Agreement now in full force, we can make
additional oil and gas along the resource-rich boundary between the United States
and Mexico available and we have a clear process by which both governments can
provide the necessary oversight to ensure exploration and development
activities are conducted safely and responsibly.These leases represent a significant step
forward in U.S.-Mexico cooperation in energy production and pave the way for
future energy and environmental collaboration.”
The leases were awarded to ExxonMobil, who submitted its bids for
an area located within three miles of the maritime and continental shelf
boundary with Mexico.Exxon acquired the
blocks at an auction back in August, 2013.The Agreement was approved by congress in December of 2013, and signed
into law by President Obama on December 26th.
The Transboundary Agreement provides a level of increased
certainty for United States and Mexican firms that operate in the Gulf border
areas, and it also allows additional areas to be accessible for production and
exploration. It sets guidelines for developing
oil and natural gas reservoirs that cross the boundary, and United States
companies and Mexico’s PEMEX can voluntarily enter into agreements that jointly
develop the reservoirs.
Additionally, the Transboundary Agreement assures that joint
inspection teams from both the Bureau of Safety and Environmental Enforcement
and the Mexican government can enforce compliance with any applicable laws and
regulations.Both sides will review any
plans for developing transboundary reservoirs, and may establish additional requirements
prior to allowing development activities to begin.