H.R. 1613: Expand Deepwater Drilling in Gulf of Mexico

The House of Representatives passed H.R. 1613, the “Outer Continental Shelf Transboundary Hydrocarbon Agreements Authorization Act”; it would implement a deal then-Secretary of State Hillary Clinton signed with Mexico that permits exploration and drilling in the middle of the Gulf of Mexico. It also allows oil and gas companies to hide payments to foreign countries.

*Get all the details on this bill in podcast episode CD033: Let’s Deepwater Drill*

Background

A moratorium (prohibition) on deep-water exploration and drilling has been in effect since 2000 in an area in the middle of the Gulf of Mexico known as the Western Gap, which contains the agreed-upon nautical border of the United States and Mexico. HR 1613

Mexico’s oil and gas resources were fully nationalized until 2008; since then Mexico has started to allow foreign oil companies to partner with PEMEX, Mexico’s nationalized oil company. The Republicans on the Committee on Natural Resources (who took almost $2 million from the oil and gas industries for the 2012 election alone) want to get the agreement approved before Mexicans have a chance to pass laws which would shut these oil industry partnerships down (page 4).

Nine oil companies have already spent at least $47 million on leases in the Western Gap area. They want to drill, baby, drill.

The drilling planned in the Western Gap is categorized as ultra-deepwater; that is the same category as was the Deepwater Horizon drilling operation which went tragically wrong on April 20, 2010. British Petroleum and Transocean – the companies responsible for the Deepwater Horizon drilling operation – cut corners to save money and their rig exploded, killing 9 crew members. When the floating rig sank, the mile-long straw attached to the drilling rig which was sucking oil out of the ground bent and burst in three places. As a result, oil gushed from the sea floor for 87 days until the gusher was capped on July 15, 2010. The long term effects of the disaster are still unknown; it happened only three years ago.

What is known is that most of the safety reforms recommended after the BP disaster have not been implemented by Congress. The Oil Spill Commission – created after the BP disaster – recently gave Congress a D+ grade for implementing the needed reforms and providing resources to oil industry safety. As of April 2013, they had only implemented one of the Commission’s recommendations.

By the way, take another look at the chart detailing the leases in the Western Gap. BP – the company who plead guilty to 12 felonies for the Deepwater Horizon disaster – is involved in leases covering 180 square miles of the Western Gap.

Despite the tragic history of ultra-deepwater exploration and drilling, then-Secretary of State Hillary Clinton signed an revenue sharing agreement with Mexico in February 2012 which would pave the way for drilling in the Western Gap. The agreement needs to be enacted by Congress to go into effect.

Bill Highlights

TITLE I

(a) Approves implementation of any international hydrocarbon agreement entered into by the President and approved by Congress.

(d) Waives (section q) implemented by Dodd-Frank Wall Street reform that requires oil and gas companies to report their payments to foreign nations.

TITLE II

Approves the deal made with Mexico setting parameters for drilling in the Western Gap.

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