On February 20, the United States and Mexico reached an agreement that could open up more areas for deepwater drilling. Awaiting ratification by Mexican and American lawmakers is the Transboundary Agreement, which would potentially make close to 1.5 million acres of offshore territory (claimed by the U.S.) available for leasing by the beginning of the summer. This area holds approximately 172 million barrels of oil and 300 billion cubic feet of natural gas. As gasoline prices have been rising as of late, these discussions regarding domestic drilling are coming at an opportune time.
One reason that this agreement is advantageous for these countries is because both Mexico and the United States, while maintaining sovereignty and control over their regulatory systems, will be on the same page when it comes to safety protocols utilized by the countries’ rigs in the Gulf of Mexico. Mexico’s national oil company, Pemex, has been developing deepwater drilling in recent years, but the main concern is its lack of experience and safety. Ken Salazar, the interior secretary, stated that as the Mexican company embarks on newer, deeper waters, both countries “want to make sure it’s done in a way that protects the environment and is as safe as possible.” On this point, former president of Amoco Oil Latin America, Jorge Piñon, commented that Mexico doesn’t have resources to deal with a major oil spill should one occur in these deeper waters, but the United States does. Therefore, this agreement could promote transnational training, equipment, and technology so that the drilling is both “safe and productive.”
In the 1970s and 1980s, the two countries attempted to ratify a treaty that would have clearly defined exploratory rights in border zones. However, the U.S. Senate did not ratify it in the end. Obama is also seeking to approve drilling in Alaskan Arctic waters. What consequences, good and bad, do you feel will result from the ratification of this agreement? Should we continue to explore offshore drilling? Will this Mexico-U.S. agreement, if ratified, alleviate the price at the pump?