The Outer Continental Shelf Transboundary Hydrocarbon Agreements Authorization Act (H.R. 1613), sponsored by Representatives Jeff Duncan (SC-03), Doc Hastings (WA-04), and Matt Salmon (AZ-05), would enact the terms of an agreement signed by the Obama Administration and Mexico to govern how to explore, develop, and share revenue from oil and natural gas resources along the maritime border in the Gulf of Mexico.
The bill would expand U.S. energy production, create new American jobs, and grow our economy by opening new areas to oil and natural gas production in the Gulf of Mexico.
According to the Bureau of Ocean Energy Management and the U.S. State Department, these areas are estimated to contain 172 million barrels of oil and 304 billion cubic feet of natural gas.
It would give American job-creators and workers the certainty to move forward with exploration and development along the maritime border.
These areas are ready to be explored and developed; activity will begin there as soon as the agreement is enacted. Enacting H.R. 1613 would put Americans to work and generate tens of millions of dollars in new revenue.
Currently, there are 67 active lease blocks held by nine companies on the U.S. portion of this area. This means roughly 20 percent of the available acreage in this area is under lease and awaiting certainty in order to move forward with exploration and development.
The bill would protect U.S. jobs and provide greater regulatory certainty to U.S. companies.
The agreement signed by the Obama Administration and Mexico specifically provides what royalty payments Mexico would receive from energy developers. However, under current U.S. law (section 1504 of the Dodd-Frank Wall Street Reform and Consumer Protection Act) companies that commercially develop oil, natural gas or minerals are required to disclose payments made to a foreign government. This could create a potential conflict because Mexico has yet to decide how they will collect royalties and could potentially set regulatory measures that prohibit disclosure of payments.
The bill includes a provision that would waive the Dodd-Frank requirement in order to help protect American jobs and American-made energy. Without it, foreign-controlled energy companies could develop this American energy resource and the royalty payments to Mexico would still be undisclosed and kept private.
The bill would also put into place an important and transparent framework for future implementation of similar transboundary hydrocarbon agreements with other nations.
Markup - Full Committee Markup on H.R. 1613 and other bills (5/15/2013)
Hearing - Subcommittee on Energy and Mineral Resources Oversight Hearing on "U.S.-Mexico Transboundary Hydrocarbon Agreement and Steps Needed for Implementation" and Legislative Hearing on H.R. 1613 (4/25/2013)
