US, Mexico Agree on Oil and Gas Drilling in Gulf of Mexico
The U.S. and Mexico have reached a cooperative agreement for oil and gas drilling along the maritime border in the Gulf of Mexico, ending years of negotiation that has left the area untapped for more than a decade.
The agreement signed on Monday by the United States Secretary of State Hillary Clinton and Mexico's foreign minister Patricia Espinosa, establishes a legal framework for U.S. companies to develop offshore energy projects with Mexico's national oil company Petroleos Mexicanos (Pemex).
The area, which spans almost 1.5 million acres, runs due east from the U.S. - Mexico border and includes areas where the water is almost 11,000 feet deep.
According to Clinton, the agreement would ensure "safe, efficient and responsible" exploration of the oil and gas reservoirs - reservoirs that could "hold considerable reserves that would benefit the United States and Mexico alike."
However, she cautioned that the reservoirs might not always be clearly drawn on maritime boundaries:
This could lead to disputes if a company discovers a reservoir that straddles the boundary - disputes, for example, over who should do the extraction and how much they should extract.
However, should the two governments disagree on how to exploit a reservoir, either can take its share unilaterally.
The agreement also allows U.S. and Mexican safety officials to work together to ensure the projects meet the safety standards of both nations and sets the groundwork for more cooperation to develop uniform safety guidelines for offshore energy development - particularly important as neither sides have embarked on projects in deep-water drilling beyond 9,000 feet.
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According to the United States Bureau of Ocean Energy Management, the areas included in the agreement may contain as much as 172 million barrels of oil and 304 billion cubic feet of natural gas.
Mexican President Filipe Calderon welcomed the deal, saying it would ease Mexican fears that their oil might be appropriated by the United States.
At the same time, Calderon said the deal would boost the country's energy security and increase revenues from Pemex, which account for almost a third of Mexico's government income.
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Related Information: Oil Extraction, Petroleum Extraction
Related Information: US Oil and Gas Industry,Mexico Economy