29–006 

113TH CONGRESS REPT. 113–101 " ! HOUSE OF REPRESENTATIVES 1st Session Part 1 

OUTER CONTINENTAL SHELF TRANSBOUNDARY 

HYDROCARBON AGREEMENTS AUTHORIZATION ACT 

JUNE 6, 2013.—Committed to the Committee of the Whole House on the State of 

the Union and ordered to be printed 

Mr. HASTINGS of Washington, from the Committee on Natural 

Resources, submitted the following 

R E P O R T 

together with 

DISSENTING VIEWS 

[To accompany H.R. 1613] 

[Including cost estimate of the Congressional Budget Office] 

The Committee on Natural Resources, to whom was referred the 

bill (H.R. 1613) to amend the Outer Continental Shelf Lands Act 

to provide for the proper Federal management and oversight of 

transboundary hydrocarbon reservoirs, and for other purposes, having considered the same, report favorably thereon with an amendment and recommend that the bill as amended do pass. 

The amendment is as follows: 

Strike all after the enacting clause and insert the following: 

SECTION 1. SHORT TITLE. 

This Act may be cited as the ‘‘Outer Continental Shelf Transboundary Hydrocarbon Agreements Authorization Act’’. 

TITLE I—AMENDMENT TO THE OUTER 

CONTINENTAL SHELF LANDS ACT 

SEC. 101. AMENDMENT TO THE OUTER CONTINENTAL SHELF LANDS ACT. 

The Outer Continental Shelf Lands Act (43 U.S.C. 1331 et seq.) is amended by 

adding at the end the following: 

‘‘SEC. 32. TRANSBOUNDARY HYDROCARBON AGREEMENTS. 

‘‘(a) AUTHORIZATION.—After the date of enactment of the Outer Continental Shelf 

Transboundary Hydrocarbon Agreements Authorization Act, the Secretary may imVerDate Mar 15 2010 00:52 Jun 08, 2013 Jkt 029006 PO 00000 Frm 00001 Fmt 6659 Sfmt 6621 E:\HR\OC\HR101P1.XXX HR101P1

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plement the terms of any transboundary hydrocarbon agreement for the management of transboundary hydrocarbon reservoirs entered into by the President and approved by Congress. In implementing such an agreement, the Secretary shall protect the interests of the United States to promote domestic job creation and ensure 

the expeditious and orderly development and conservation of domestic mineral resources in accordance with all applicable United States laws governing the exploration, development, and production of hydrocarbon resources on the outer Continental Shelf. 

‘‘(b) SUBMISSION TO CONGRESS.— 

‘‘(1) IN GENERAL.—No later than 180 days after all parties to a transboundary 

hydrocarbon agreement have agreed to its terms, a transboundary hydrocarbon 

agreement that does not constitute a treaty in the judgment of the President 

shall be submitted by the Secretary to— 

‘‘(A) the Speaker of the House of Representatives; 

‘‘(B) the Majority Leader of the Senate; 

‘‘(C) the Chair of the Committee on Natural Resources of the House of 

Representatives; and 

‘‘(D) the Chair of the Committee on Energy and Natural Resources of the 

Senate. 

‘‘(2) CONTENTS OF SUBMISSION.—The submission shall include— 

‘‘(A) any amendments to this Act or other Federal law necessary to implement the agreement; 

‘‘(B) an analysis of the economic impacts such an agreement and any 

amendments necessitated by the agreement will have on domestic exploration, development, and production of hydrocarbon resources on the outer 

Continental Shelf; and 

‘‘(C) a detailed description of any regulations expected to be issued by the 

Secretary to implement the agreement. 

‘‘(c) IMPLEMENTATION OF SPECIFIC TRANSBOUNDARY AGREEMENT WITH MEXICO.— 

The Secretary may take actions as necessary to implement the terms of the Agreement between the United States of America and the United Mexican States Concerning Transboundary Hydrocarbon Reservoirs in the Gulf of Mexico, signed at Los 

Cabos, February 20, 2012, including— 

‘‘(1) approving unitization agreements and related arrangements for the exploration, development, or production of oil and natural gas from transboundary 

reservoirs or geological structures; 

‘‘(2) making available, in the limited manner necessary under the agreement 

and subject to the protections of confidentiality provided by the agreement, information relating to the exploration, development, and production of oil and 

natural gas from a transboundary reservoir or geological structure that may be 

considered confidential, privileged, or proprietary information under law; 

‘‘(3) taking actions consistent with an expert determination under the agreement; and 

‘‘(4) ensuring only appropriate inspection staff at the Bureau of Safety and 

Environmental Enforcement or other Federal agency personnel designated by 

the Bureau, the operator, or the lessee have authority to stop work on any installation or other device or vessel permanently or temporarily attached to the 

seabed of the United States, which may be erected thereon for the purpose of 

resource exploration, development or production activities as approved by the 

Secretary. 

‘‘(d) EXEMPTION FROM RESOURCES EXTRACTION REPORTING REQUIREMENT.—Actions taken by a public company in accordance with any transboundary hydrocarbon 

agreement shall not constitute the commercial development of oil, natural gas, or 

minerals for purposes of section 13(q) of the Securities Exchange Act of 1934 (157 

U.S.C. 78m(q)). 

‘‘(e) SAVINGS PROVISIONS.—Nothing in this section shall be construed— 

‘‘(1) to authorize the Secretary to participate in any negotiations, conferences, 

or consultations with Cuba regarding exploration, development, or production of 

hydrocarbon resources in the Gulf of Mexico along the United States maritime 

border with Cuba or the area known by the Department of the Interior as the 

‘Eastern Gap’; or 

‘‘(2) as affecting the sovereign rights and the jurisdiction that the United 

States has under international law over the outer Continental Shelf which appertains to it.’’. 


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TITLE II—APPROVAL OF TRANSBOUNDARY 

HYDROCARBON AGREEMENT 

SEC. 201. APPROVAL OF AGREEMENT WITH MEXICO. 

The Agreement between the United States of America and the United Mexican 

States Concerning Transboundary Hydrocarbon Reservoirs in the Gulf of Mexico, 

signed at Los Cabos, February 20, 2012, is hereby approved. 

PURPOSE OF THE BILL

The purpose of H.R. 1613, as ordered reported, is to amend the 

Outer Continental Shelf Lands Act to provide for the proper Federal management and oversight of transboundary hydrocarbon reservoirs. 

BACKGROUND AND NEED FOR LEGISLATION

The Outer Continental Shelf Transboundary Hydrocarbon Agreements Authorization Act (H.R. 1613) will provide the Secretary of 

the Interior the legislative authority to implement a February 2012 

Agreement signed by then-U.S. Secretary of State Hillary Clinton 

and Mexican Foreign Secretary Patricia Espinosa on how to explore, develop and share revenue from hydrocarbon reservoirs that 

overlie our maritime boundary with Mexico in the Gulf of Mexico. 

The bill also establishes a clear and transparent process on how to 

implement future transboundary hydrocarbon agreements, ensures 

U.S. sovereignty on our Outer Continental Shelf (OCS), and includes a discreet waiver of Securities and Exchange Commission 

reporting requirements that may be in conflict with language in 

the Agreement and Mexican law to provide certainty to future exploration and development in these areas. 

In 1978, the United States established maritime boundaries with 

Mexico extending out to the 200-nautical-mile limit of our nation’s 

exclusive economic zone. However, this mapping left two enclosed 

areas, known as the Western Gap and Eastern Gap, both of which 

extended beyond the 200-nautical-mile jurisdiction of each country. 

As a result, on June 9, 2000, the United States and Mexico signed 

the U.S.-Mexico Maritime Boundary Treaty which established a 

continental shelf boundary between the U.S. and Mexico in the 

Western Gap area. This treaty was ratified by the Senate on October 18, 2000, and established a 1.4-nautical-mile moratorium from 

hydrocarbon development on each side of the boundary in the 

Western Gap area in recognizing the possibility of transboundary 

hydrocarbon oil and gas reservoirs. While the moratorium was due 

to expire in 2010, it has been extended, during which time the U.S. 

and Mexico have arrived at the aforementioned Agreement, which 

sets up a legal framework to guide commercial energy development 

in these areas. 

While there has only been an official moratorium in the Western 

Gap areas described above, lease blocks along other areas of the 

U.S./Mexico maritime border in the Gulf have not been explored 

and developed for oil and gas resources due to uncertainty and disputes over the legal treatment of potential transboundary reservoirs. The February 2012 Agreement only covers the U.S./Mexican maritime boundary and the Western Gap. 


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The situation has been further complicated by the control of the 

Mexican oil market by Mexico’s national oil company, Petroleos 

Mexicanos (PEMEX), and Mexico’s pre-2008 prohibition on foreign 

oil and gas companies operating within Mexican territory. However, while investment is now permitted, there remains a possibility that Mexico will pass laws which are inconsistent with U.S. 

interests, and U.S. companies must be protected from this. According to Duncan Wood, Director of the Mexico Institute at the Woodrow Wilson International Center for Scholars, Mexico ratified the 

Agreement as a treaty in April 2012, despite some opposition, who, 

prior to reviewing the final details of the Agreement, portrayed it 

as ‘‘selling out to the U.S.’’ 

That said, the Calderon Administration largely supported the finalization of the Agreement given PEMEX’s longstanding troubles 

in its deep water endeavors. Additionally, current Mexican President Enrique Pen ̃ a Nieto, whose six-year term began in December 

2012, has indicated his intention to promote legislative changes to 

allow private companies to partner with PEMEX. Some have 

viewed this push for collaboration as a clear signal that Mexico 

wishes to enhance its deep water production given the United 

States’ vast success in the Gulf of Mexico OCS. 

The Obama Administration has decided to enact this Agreement 

as a Congressional-Executive Agreement, rather than a treaty, 

which requires a simple majority in both houses of Congress rather 

than a 2/3 majority in the Senate. Despite the difference in approval methods, the Agreement has the same status under international law as Mexico’s ratification. 

Currently, there are 67 active lease blocks held by nine companies on the U.S. portion of the Western Gap, meaning roughly 20% 

of the available acreage in the Gap area is under lease and awaiting certainty to move forward with exploration and development. 

There are 11 active lease blocks within three miles of the U.S./Mexico maritime boundary in the Western Planning Area of the Gulf 

(outside of the Gap) also waiting development. While comprehensive seismic scans have not been taken, these areas in the Western 

Gap as well as the lease blocks along the maritime border are considered likely to contain significant hydrocarbon resources. The Bureau of Ocean Energy Management and the U.S. State Department 

estimate that these areas contain as much as much as 172 million 

barrels of oil and 304 billion cubic feet of natural gas. 

On November 2, 2011, the Subcommittee on Energy and Mineral 

Resources held an oversight hearing entitled ‘‘North American Offshore Energy: Mexico and Canada Boundary Treaties and New 

Drilling by Cuba and Bahamas.’’ This hearing briefly touched on 

the need to finalize the Transboundary Hydrocarbon Agreement 

with Mexico to move forward with energy development in the Gulf 

of Mexico along our two nation’s maritime boundaries. Four 

months later, the Agreement was signed in February 2012. Despite 

indicating it was a priority of the Obama Administration, the Department of the Interior did not respond to the repeated requests 

by the House Natural Resource Committee Majority staff for draft 

enacting legislation throughout 2012. In a Full Committee oversight hearing held on May 9, 2012, regarding the President’s 5-year 

offshore leasing plan, Chairman Doc Hastings specifically asked Director Tommy Beaudreau of the Bureau of Ocean Energy ManageVerDate Mar 15 2010 00:52 Jun 08, 2013 Jkt 029006 PO 00000 Frm 00004 Fmt 6659 Sfmt 6602 E:\HR\OC\HR101P1.XXX HR101P1

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ment when the Department of the Interior would be providing the 

Committee with draft legislation to implement the Agreement, to 

which Director Beaudreau replied ‘‘very soon.’’ 

Unfortunately, this was not the case and instead, the Administration attempted to insert a single paragraph in a last-minute 

non-germane Senate bill in December 2012. Consent to adoption of 

that language would have denied Congress its important oversight 

function, and the language would not have sufficiently protected 

U.S. companies in the implementation process. 

The Administration first provided the House Natural Resources 

Committee with proposed implementation language on March 19, 

2013, over one year after the signing of the Agreement. Work 

began immediately, with Congressman Jeff Duncan (R–SC) drafting implementing legislation and introducing a final bill on April 

18, 2013. One week later, on April 25, 2013, the Subcommittee on 

Energy and Mineral Resources conducted a hearing on the bill. 

The extreme difficulty in obtaining specific implementation guidance and language from the Department of the Interior and the 

U.S. Department of State in a timely manner was a motivation to 

include paragraphs (a) and (b) in H.R. 1613, rather than providing 

a more simple approval of the Agreement. Given our nation’s vast 

energy resources in other areas where the United States shares a 

maritime border with other nations, the need for future transboundary hydrocarbons agreements will likely be necessary. The 

approval of this Agreement is setting a significant precedent for 

such future agreements. Therefore, there was a clear need for a 

transparent process through which the Department of the Interior 

and the U.S. Department of State should operate to avoid future 

delays. 

Finally, paragraph (d) of H.R. 1613 was included to provide a discreet exemption from the reporting requirements of Section 13q–1 

of the Securities Exchange Act (as implemented by Public Law 

111–517, the Dodd-Frank Wall Street Reform and Consumer Protection Act). This provision is only applicable to the exploration and 

development of transboundary hydrocarbon reservoirs between the 

U.S. and Mexico, as defined in the Agreement. The Obama Administration signed the Agreement with Mexico to develop energy resources bridging our international maritime boundary and that 

Agreement makes provision for the sharing of royalties on transboundary reservoirs, and also has very specific requirements on 

maintaining data confidentiality. 

Without the Dodd-Frank clarification in H.R. 1613, American 

workers could be blocked from producing American energy in 

American waters if Mexico blocks disclosure of royalty payments 

due to it under the terms of the Agreement signed by the Obama 

Administration. This potential outcome was confirmed by witnesses 

during the April 25, 2013, hearing on H.R. 1613. As a result of this 

conflict between the Agreement language and Securities and Exchange Commission (SEC) requirements, American companies 

could be barred from developing a discovered transboundary energy 

resource, thereby leaving it to foreign-controlled energy companies 

such as China or Russia, who fall outside the jurisdiction of these 

SEC reporting requirements, to develop this American resource. 

The Committee determined that rather than face the prospect of 

putting American jobs and American-made energy at risk, this legVerDate Mar 15 2010 00:52 Jun 08, 2013 Jkt 029006 PO 00000 Frm 00005 Fmt 6659 Sfmt 6602 E:\HR\OC\HR101P1.XXX HR101P1

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islation should include a clarification that provides certainty to prevent such an outcome. 

COMMITTEE ACTION

H.R. 1613 was introduced on April 18, 2013, by Congressman 

Jeff Duncan (R–SC). The bill was referred to the Committee on 

Natural Resources, and within the Committee to the Subcommittee 

on Energy and Mineral Resources. In addition, the bill was referred 

to the Committees on Foreign Affairs and Financial Services. On 

April 25, 2013, the Subcommittee on Energy and Mineral Resources held a hearing on the bill. On May 15, 2013, the Full Natural Resources Committee met to consider the bill. The Subcommittee on Energy and Mineral Resources was discharged by 

unanimous consent. Congressman Doug Lamborn (R–CO) offered 

an amendment designated #1 to the bill; the amendment was 

adopted by voice vote. Congressman Rau ́l Grijalva (D–AZ) offered 

an amendment designated .001 to the bill; the amendment was not 

adopted by a roll call vote of 18 to 23, as follows: 


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Date: May 15,2013 

Committee on Natural Resources 

u.s. House of Representatives 

I 13th Congress 

Recorded Vote #: 10 

Meeting on I Amendment on: H.R. 1613 - Grijalva.001, Not agreed to by vote of 18 yeas and 23 nays 

MEMBERS Yea Nay Pres MEMBERS Yea Nay 

Mr. Hastings, W A, Chairman X Mr. Duncan, SC X 

Mr. Markey, MA, Ranking Ms. Hanabusa, HI X 

Mr. Young,AK X Mr. Tipton, CO X 

Mr. Defazio, OR X Mr. Cardenas, CA X 

Mr. Gohmert, TX Mr. Gosar, AZ X 

Mr. Faleomavaega, AS Mr. Horsford, NV X 

Mr, Bishop, UT X Mr. Labrador, 10 X 

Mr. Pal/one, NJ X Mr. Huffman, CA X 

Mr. Lamborn, CO X Mr. Southerland, FL X 

Mrs. Napolitano, CA X Mr. Ruiz, CA X 

Mr. Wittman, VA X Mr. Flores, TX X 

Mr. Holt,NJ X Ms. Shea·Porter, NH X 

Mr. Broun, GA Mr. Rnnyan, NJ X 

Mr. Grijalva, AZ X Mr. Lowenthal, CA X 

Mr. Fleming, LA X Mr, Amodei, NY X 

Ms. BordaI/o, GU X Mr. Garcia, FL X 

Mr. McClintock, CA X Mr. Mnllin, OK X 

Mr. Costa, CA Mr. Cartwrif{ht, PA X 

Mr. Thompson, PA X Mr. Stewart, UT X 

Mr. Sablan, CNMI X Mr. Daines, MT X 

Ms. Lummis, WY X Mr. Cramer, NO X 

Ms. Tsongas, MA X Mr. LaMalfa, CA X 

Mr. Benishek, MI X 

Mr. Pierluisi, PR X 

TOTALS 18 23 

Pres 
8 

Congressman Rau ́l Grijalva (D–AZ) offered an amendment designated Holt.003 to the bill; the amendment was not adopted by a 

roll call vote of 18 to 23, as follows: 


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Date: May 15, 2013 

Committee on Natural Resources 

U.S. House of Representatives 

113 th Congress 

Recorded Vote #: 11 

Meeting on I Amendment on: H.R. 1613 - Holt.003, offered by Mr. Grijalva, Not agreed to by vote of 18 yeas 

and 23 nays 

MEMBERS Yea Nay Pres MEMBERS Yea Nay Pres 

Mr. Hastings, W A, Chairman X Mr. Duncan, SC X 

Mr. Markey. MA. Ranking Ms. Hanabusa. HI X 

Mr. Young, AK X Mr. Tipton, CO X 

Mr. Defazio. OR X Mr. Cardenas. CA X 

Mr. Gohmert, TX Mr. Gosar, AZ X 

Mr. Faleomavaega. AS Mr. Horsford, NV X 

Mr, Bishop, UT X Mr. Labrador, ID X 

Mr. Pallone, NJ X Mr. Huffman. CA X 

Mr. Lamborn, CO X Mr. Southerlaud, FL X 

Mrs. Napolitano, CA X Mr. Ruiz. CA X 

Mr. Wittman, VA X Mr. FIores, TX X 

Mr. Holl.NJ X Ms. Shea-Porter, NH X 

Mr, Broun, GA Mr, Runyan, NJ X 

Mr. Grijalva. AZ X Mr. Lowenthal. CA X 

Mr. Fleming, LA X Mr. Aruodei, NV X 

Ms. Bordallo. GU X Mr. Garcia. FL X 

Mr, McClintock, CA X Mr, Mullin, OK X 

Mr. Cos la, CA Mr. Cartwright. PA X 

Mr. Thompson, PA X Mr. Stewart, UT X 

Mr. Sablan. CNMI X Mr. Daiues, MT X 

Ms. Lummis, WY X Mr. Cramer, ND X 

Ms. Tsongas. MA X Mr. LaMalfa, CA X 

Mr. Benishek, MI X 

Mr. Pierluisi. PR X 

TOTALS 18 23 
10 

No further amendments were offered and the bill, as amended, 

was then adopted and ordered favorably reported to the House of 

Representatives by a bipartisan roll call vote of 25 to 16, as follows: 


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Date: May 15, 2013 

Committee on Natural Resources 

u.s. House of Representatives 

I 13th Congress 

Recorded Vote #: 12 

Meeting on I Amendment on: H.R. 1613 - To adopt and favorahly report the bill to the House, as amended, 

agreed to by a vote of 25 yeas to 16 nays 

MEMBERS Yea Nay Pres MEMBERS Yea Nay Pres 

Mr. Hastings, WA, Chairman X Mr. Duncan, SC X 

Mr. Markey, MA, Ranking Ms. Hanabusa, HI X 

Mr. Youug, AI( X Mr. Tipton, CO X 

Mr. Defazio, OR X Mr. Cardenas, CA X 

Mr. Gohmert, TX Mr. Gosar, AZ X 

Mr. Faleomavaega, AS Mr. Horsford, NV X 

Mr. Bishop, UT X Mr. Labrador, ID X 

Mr. Pallone, NJ X Mr. Huffman, CA X 

Mr. Lamborn, CO X Mr. Southerland, FL X 

Mrs. Napolitano, CA X Mr. Ruiz, CA X 

Mr. Wittman, VA X Mr. Flores, TX X 

Mr. Holt,NJ X Ms. Shea-Porter, NH X 

Mr. Broun, GA Mr. Runyan, NJ X 

Mr. Grijalva, AZ X Mr. Lowenthal, CA X 

Mr. Fleming, LA X Mr. Amodei, NV X 

Ms. Bordallo, GU X Mr. Garcia, FL X 

Mr. McClintock, CA X Mr. Mullin, OK X 

Mr. Costa, CA Mr. Cartwright, PA X 

Mr. Thompson, PA X Mr. Stewart, UT X 

Mr. Sablan, CNMI X Mr. Daines, MT X 

Ms. Lummis, WY X Mr. Cramer, ND X 

Ms. Tsongas, MA X Mr. LaMalfa, CA X 

Mr. Benishek, MI X 

Mr. Pieriuisi, PR X 

TOTALS 25 16 
12 

COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of rule XIII 

of the Rules of the House of Representatives, the Committee on 

Natural Resources’ oversight findings and recommendations are reflected in the body of this report. 

COMPLIANCE WITH HOUSE RULE XIII 

1. Cost of Legislation. Clause 3(d)(1) of rule XIII of the Rules of 

the House of Representatives requires an estimate and a comparison by the Committee of the costs which would be incurred in carrying out this bill. However, clause 3(d)(2)(B) of that rule provides 

that this requirement does not apply when the Committee has included in its report a timely submitted cost estimate of the bill prepared by the Director of the Congressional Budget Office under section 402 of the Congressional Budget Act of 1974. Under clause 

3(c)(3) of rule XIII of the Rules of the House of Representatives and 

section 403 of the Congressional Budget Act of 1974, the Committee has received the following cost estimate for this bill from the 

Director of the Congressional Budget Office: 

H.R. 1613—Outer Continental Shelf Transboundary Hydrocarbon 

Agreements Authorization Act 

Summary: H.R. 1613 would approve a February 20, 2012, agreement between the United States and Mexico regarding the development of oil and gas resources in what is known as the ‘‘transboundary’’ area in the Gulf of Mexico. It would establish guidelines and 

procedures for implementing that agreement and for Congressional 

review of any future agreements governing that area. 

Pay-as-you-go procedures apply to this bill because enacting the 

legislation would affect offsetting receipts, which are recorded as a 

credit against direct spending. CBO estimates that enacting H.R. 

1613 would increase offsetting receipts from lease sales in the 

Outer Continental Shelf (OCS) by $25 million over the 2014–2023 

period, thus reducing direct spending by a corresponding amount. 

Enacting H.R. 1613 would not affect revenues. 

H.R. 1613 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA) 

and would impose no costs on state, local, or tribal governments. 

Estimated cost to the Federal Government: The estimated budgetary impact of H.R. 1613 is shown in the following table. The costs 

of this legislation fall within budget function 950 (undistributed offsetting receipts). 

By fiscal year, in millions of dollars— 

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014– 

2018 

2014– 

2023 

CHANGES IN DIRECT SPENDING 

Estimated Budget Authority .. ¥7 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥15 ¥25 

Estimated Outlays ................. ¥7 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥15 ¥25 

Basis of estimate: H.R. 1613 would affect the development of any 

jointly owned oil and gas resources along the border between the 

territorial waters of the United States and Mexico in the Gulf of 

Mexico. That area is known as the ‘‘transboundary area’’ and extends 1.4 miles on either side of that border. Most of the area on 


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1 Based on recent trends, CBO estimates in its May 2013 baseline that DOI will offer leases 

for about 60 million acres in the Gulf of Mexico under current law and that bonus and rental 

payments for new leases will total about $20 billion over the 2014–2023 period. Allowing additional leasing in the transboundary portion of the Western Gap would increase the acreage 

available for leasing by less than one-half of one percent. 

the United States side is far from the coast and has resources located in very deep water. Although the Department of the Interior 

(DOT) routinely offers leases for most of that acreage, little has 

been leased for development. Neither country currently allows 

firms to develop resources in one portion of the transboundary area 

(known as the Western Gap). 

CBO expects that enacting H.R. 1613 would affect OCS leasing 

activity in two ways. First, approving the 2012 agreement would 

allow DOT to offer leases for the 158,584 acres in the Western Gap 

that currently are unavailable for development. Second, it may increase the value of other leases by clarifying procedures for developing oil and gas fields that straddle the boundary of the two nations. 

CBO estimates that implementing this bill would increase offset- ting receipts by about $25 million over the 2014–2023 period, primarily from bonus and rental payments from new leasing activity. 

That estimated change in offsetting receipts is roughly proportionate to the increase in the amount of acreage made available for 

leasing relative to current law.1 For this estimate, CBO expects 

that firms would acquire additional leases in the affected area beginning in fiscal year 2014. Receipts also are projected to rise in 

subsequent years as a result of higher prices for new leases as well 

as rental and royalty payments. 

Pay-As-You-Go Considerations: The Statutory Pay-As-You-Go Act 

of 2010 establishes budget-reporting and enforcement procedures 

for legislation affecting direct spending or revenues. The net 

changes in outlays and revenues that are subject to those pay-asyou-go procedures are shown in the following table. 

CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 1613 AS ORDERED REPORTED BY THE 

HOUSE COMMITTEE ON NATURAL RESOURCES ON MAY 15, 2013 

By fiscal year, in millions of dollars— 

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2013– 

2018 

2013– 

2023 

NET INCREASE OR DECREASE (¥) IN THE DEFICIT 

Statutory Pay-As-YouGo Impact ............. 0 ¥7 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥2 ¥15 ¥25 

Intergovernmental and private-sector impact: H.R. 1613 contains 

no intergovernmental or private-sector mandates as defined in 

UMRA and would impose no costs on state, local, or tribal governments. 

Estimate prepared by: Federal Costs: Kathleen Gramp; Impact 

on State, Local, and Tribal governments: Melissa Merrill; Impact 

on the Private Sector: Amy Petz. 

Estimate approved by: Theresa Gullo, Deputy Assistant Director 

for Budget Analysis. 

2. Section 308(a) of Congressional Budget Act. As required by 

clause 3(c)(2) of rule XIII of the Rules of the House of Representatives and section 308(a) of the Congressional Budget Act of 1974, 


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this bill does not contain any new budget authority, credit authority, or an increase or decrease in revenues or tax expenditures. 

CBO estimates that enacting H.R. 1613 would increase offsetting 

receipts from lease sales in the Outer Continental Shelf (OCS) by 

$25 million over the 2014–2023 period, thus reducing direct spending by a corresponding amount. 

3. General Performance Goals and Objectives. As required by 

clause 3(c)(4) of rule XIII, the general performance goal or objective 

of this bill, as ordered reported, is to amend the Outer Continental 

Shelf Lands Act to provide for the proper Federal management and 

oversight of transboundary hydrocarbon reservoirs. 

EARMARK STATEMENT

This bill does not contain any Congressional earmarks, limited 

tax benefits, or limited tariff benefits as defined under clause 9(e), 

9(f), and 9(g) of rule XXI of the Rules of the House of Representatives. 

COMPLIANCE WITH PUBLIC LAW 104–4 

This bill contains no unfunded mandates. 

COMPLIANCE WITH H. RES. 5 

Directed Rule Making. The Chairman does not believe that this 

bill directs any executive branch official to conduct any specific 

rule-making proceedings. 

Duplication of Existing Programs. This bill does not establish or 

reauthorize a program of the federal government known to be duplicative of another program. Such program was not included in 

any report from the Government Accountability Office to Congress 

pursuant to section 21 of Public Law 111–139 or identified in the 

most recent Catalog of Federal Domestic Assistance published pursuant to the Federal Program Information Act (Public Law 95–220, 

as amended by Public Law 98–169) as relating to other programs. 

PREEMPTION OF STATE, LOCAL OR TRIBAL LAW

This bill is not intended to preempt any State, local or tribal law. 

CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of the 

House of Representatives, changes in existing law made by the bill, 

as reported, are shown as follows (new matter is printed in italic 

and existing law in which no change is proposed is shown in 

roman): 

OUTER CONTINENTAL SHELF LANDS ACT 

* * * * * * * 

SEC. 32. TRANSBOUNDARY HYDROCARBON AGREEMENTS. 

(a) AUTHORIZATION.—After the date of enactment of the Outer 

Continental Shelf Transboundary Hydrocarbon Agreements Authorization Act, the Secretary may implement the terms of any transboundary hydrocarbon agreement for the management of transboundary hydrocarbon reservoirs entered into by the President and 


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approved by Congress. In implementing such an agreement, the Secretary shall protect the interests of the United States to promote domestic job creation and ensure the expeditious and orderly development and conservation of domestic mineral resources in accordance 

with all applicable United States laws governing the exploration, 

development, and production of hydrocarbon resources on the outer 

Continental Shelf. 

(b) SUBMISSION TO CONGRESS.— (1) IN GENERAL.—No later than 180 days after all parties to 

a transboundary hydrocarbon agreement have agreed to its 

terms, a transboundary hydrocarbon agreement that does not 

constitute a treaty in the judgment of the President shall be 

submitted by the Secretary to— 

(A) the Speaker of the House of Representatives; 

(B) the Majority Leader of the Senate; 

(C) the Chair of the Committee on Natural Resources of 

the House of Representatives; and 

(D) the Chair of the Committee on Energy and Natural 

Resources of the Senate. 

(2) CONTENTS OF SUBMISSION.—The submission shall include— 

(A) any amendments to this Act or other Federal law necessary to implement the agreement; 

(B) an analysis of the economic impacts such an agreement and any amendments necessitated by the agreement 

will have on domestic exploration, development, and production of hydrocarbon resources on the outer Continental 

Shelf; and 

(C) a detailed description of any regulations expected to 

be issued by the Secretary to implement the agreement. 

(c) IMPLEMENTATION OF SPECIFIC TRANSBOUNDARY AGREEMENT

WITH MEXICO.—The Secretary may take actions as necessary to implement the terms of the Agreement between the United States of 

America and the United Mexican States Concerning Transboundary 

Hydrocarbon Reservoirs in the Gulf of Mexico, signed at Los Cabos, 

February 20, 2012, including— 

(1) approving unitization agreements and related arrangements for the exploration, development, or production of oil and 

natural gas from transboundary reservoirs or geological structures; 

(2) making available, in the limited manner necessary under 

the agreement and subject to the protections of confidentiality 

provided by the agreement, information relating to the exploration, development, and production of oil and natural gas 

from a transboundary reservoir or geological structure that may 

be considered confidential, privileged, or proprietary information under law; 

(3) taking actions consistent with an expert determination 

under the agreement; and 

(4) ensuring only appropriate inspection staff at the Bureau 

of Safety and Environmental Enforcement or other Federal 

agency personnel designated by the Bureau, the operator, or the 

lessee have authority to stop work on any installation or other 

device or vessel permanently or temporarily attached to the seabed of the United States, which may be erected thereon for the 


tjames on DSK6SPTVN1PROD with REPORTS
16 

purpose of resource exploration, development or production activities as approved by the Secretary. 

(d) EXEMPTION FROM RESOURCES EXTRACTION REPORTING RE- QUIREMENT.—Actions taken by a public company in accordance 

with any transboundary hydrocarbon agreement shall not constitute 

the commercial development of oil, natural gas, or minerals for purposes of section 13(q) of the Securities Exchange Act of 1934 (157 

U.S.C. 78m(q)). 

(e) SAVINGS PROVISIONS.—Nothing in this section shall be construed— 

(1) to authorize the Secretary to participate in any negotiations, conferences, or consultations with Cuba regarding exploration, development, or production of hydrocarbon resources in 

the Gulf of Mexico along the United States maritime border 

with Cuba or the area known by the Department of the Interior 

as the ‘‘Eastern Gap’’; or 

(2) as affecting the sovereign rights and the jurisdiction that 

the United States has under international law over the outer 

Continental Shelf which appertains to it. 


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17 


tjames on DSK6SPTVN1PROD with REPORTSInsert graphic folio 20 HR101P1.004

AMVPOflTfR THOMAS SHEEHY 

CH"ro.$TAFl' STAeFO'~EcroR, 

June 4, 2013 

The Honorable Doc Hasting~ , 

Chainnan 

I/!)ne J!;unbreb IlrfJirteentfJ €Ongre55 

1t.~. J!)ouse of l\rprtseutatibes 

€ommittte on jforeign ~lffairs 2170 Rayburn House Office Building 

Washington, DC 20515 

www.foreignaffairs.house.gov 

House Committee on Natural Resources 

1324 Longworth House Office Building 

Washington, DC 20515 

Dear Chainnan Hastings: 

JASONmlNeAUM 

D'MornAl>C STAfF DmECTO>I 

Thank you for sharing the amended text ofRR, 1613, the Outer Continental Shelf 

Transboundary Hydrocarbon Agreements Authorization Act, as marked up by your Committee, 

Based on the portions of that text within Foreign Affairs jurisdiction, I am writing to confinn the 

agreement of the Foreign Affairs Committee to be discharged from consideration ofH.R. 1613 in 

order to expedite its consideration on the House floor. In agreeing to waive consideration of that 

bill, this Committee does not waive any jurisdiction that it has over provisions in that bill or any 

other matter. This also does not constitute a waiver of the participation of the Committee of 

Foreign Affairs in any conference on this bill. I ask that you-include a copy of this letter and 

your response in any Committee report on H.R. 1613, and in the Congressional Record during 

floor consideration of the bill. 

Thank you again for your consideration and collegiality in this matter. 

Sincerely, 

Chainnan 
18 


tjames on DSK6SPTVN1PROD with REPORTSInsert graphic folio 21 HR101P1.005

The Honorable Doc Hastings 

June 4, 2013 

Page 2 

cc: The Honorable John A. Boehner, Speaker 

The Honorable Eliot L. Engel 

Mr. Thomas J. Wickham, Jr., Parliamentarian 
19 


tjames on DSK6SPTVN1PROD with REPORTSInsert graphic folio 22 HR101P1.006

mOOVOUNG 

CNlUOfSTAi'r 

3!l.~. ]{OUSt of iRtprtstntntiuts 

QIommitttt on NtttU11l1lRtsnurres 

Bftts4ington.llIQI aU515 

The Honorable Edward R. Royce 

Chairman 

Committee on Foreign Affairs 

2170 Rayburn HO~ 

Washington, D.C. 20515 

Dear Mr. Chairman: 

June 4, 2013 

;tUFFlEYDUNCAN 

tJfMOCRA nc STAn' OIREcrOR 

Thank yoU for 'your letter regarding H.R. 1613, the Outer Continental Shelf 

Transboundary Hydrocarbon Agreements Authorization Act. As you know, the Committee on 

Natural Resources ordered reported the bill, as amended, on May 15,2013. I appreciate your 

support in bringing this. legislation before the House of Representatives, and accordingly, 

understand that the Committee o.n Foreign Affairs will forego action tm.the bill. 

The Committee on Natural Resources concurs with the mutual understanding that by 

foregoing consideration ofH.R. 1613 at this time, the Committee on Foreign Affairs does not 

waive any jurisdiction over the subject matter contained in this or similar legislation. In 

addition, should a conference on the bill be necessary, 1 would support your requestto have the 

Commiltee o.n Fo.reign Affairs represented 01\ the conference committ.ee. Finally; 1 would be 

pleased to include your letter and this response in the bill report filed by the Committee on 

Natural Resources, ~as well as in the Congressional Record during floor consideration, to 

memorialize our understanding. 

Thank you foryonr cooperation. 

lfLlk 

Doc Hastings 

Chairman 

http://mJturafresources.h6use.gov 
20 


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JEB HENSARLING, TX , CHAIRMAN '1tlnitcd .statts tit ouSt of 'RtprcscntatillcS 

(iommittcc on jfinancial ~Cr\liCCll 

2129 'R9!!burn !r'lousc emcc )5uilding 

'\1Ilgsl1ington, lUi. 20515 

HAND.DELIVERED 

The Honorable Doc Hastings 

Cbairman 

Committee on Natural Resources 

1324 Longworth House Office Building 

Washington, DC 20515 

Dear Chairman Hastings: 

June 5, 2013 

MAXINE WATERS, CA, RANKING MEMBER 

On May 15, 2013, the Committee on Natural Resources ordered H,R. 1613, the 

Outer Continental Shelf Transboundary Hydrocarbon Agreements Authorization Act, as 

amended, to be reported favorably to tbe House, As a result of your having consulted with 

the Committee on Financial Services concerning provisions of the bill that fall within our 

Rule X jurisdiction, I agree to discharge our committee from further consideration of the bill 

so that it may proceed expeditiously to the House Floor, 

The Committee on Financial Services takes this action with our mutual 

understanding that, by foregoing consideration of H.R. 1613, as amended, at this time, we 

do not waive any jurisdiction over the subject matter contained in this or similar 

legislation, and that our committee will be appropriately consulted and involved as the bill 

or similar legislation moves forward so that we may address any remaining issues that fall 

within our Rule X jurisdiction. Our committee also reserves the right to seek appointment 

of an appropriate number of conferees to any House-Senate conference involving this or 

similar legislation, and requests your support for any such request. 

Finally, I would appreciate your response to this letter confirming this 

understanding with respect to H.R. 1613, as amended, and would ask that a copy of our 

exchange of letters on this matter be included in your committee's report to accompany the 

legislationandlor in the Congressional Record during floor consideration thereof. 

Sincerely, 

cc: The Honorable John A. Boehner (via e-mail) 

The Honorable Maxine Waters (via e-mail) 

The Honorable Edward J. Markey (via e-mail) 

Mr. Thomas J. Wickham, Jr. (via e-mail) 
21 


tjames on DSK6SPTVN1PROD with REPORTSInsert graphic folio 24 HR101P1.008

TOOOYOUNG 

CHIEF'CfSTAFF 

lt~. 3J{ouae of ltepreaentattuea 

(!fnmmltttt nn Natural mt1inUrUIi 

illlII1I4ingtnn.lllQi: 2US1S 

The Honorable Jeb liensarling 

Chairman 

Committee on Financial Services 

2129 Rayburn HOB 

Washington, D.C. 20515 

Dear Mr. Chairman: 

June 5, 2013 JE!'fREYmJNCAH 

DEMOCRAT/CSTA'fFDlIlECTOR 

Thank you for your letter regarding H.R. 1613, the Outer Continental Shelf, 

Transboundary Hydrocarbon Agreements Authorization Act. As you know, the Committee on 

Natural Resources ordered reported the bill, as amended, on May 15,2013. I appreciate your 

support in bringing this legislation before the HOl!se of Representatives, and accordingly, 

understand that the Committee on Financial Services will forego action on the bill. 

the Committee on Natural'Resources concurs with the mutual understanding thaI by 

foregoing consideration ofRR. 1613 at this time, the Committee on Finan,ciaJ Services does not 

waive any jurisdiction over the subject malter contained in this or similar legislation. In 

addition, should a conference on the bill be necessary,l would support your request to have the 

Committee on Financial Services represented on the conference corhmittee. Finally, I would be 

pleased to include yonr letter and this response in the bill report filed by the Committee on 

Nall!ral Resources, as well as in the Congressional Record during floor consideration, to 

memorialize'our understanding. 

Thank you for your cooperation. 

l$-Ik Doc Hastings 

Chairman 
(22) 

DISSENTING VIEWS 

We oppose H.R. 1613 because the Majority wrote this legislation 

without the input of the minority and included in it a poison pill 

provision that will ensure it will never become law in its current 

form. Legislation could have been drafted on a bipartisan basis and 

swiftly passed to allow the Administration to implement an agreement between the United States and Mexico to allow for the safe 

development of resources in the Gulf of Mexico along the maritime 

border between the two countries. Instead, the Majority tucked a 

provision into H.R. 1613 that would waive a section of the DoddFrank financial reform bill that requires disclosure of company 

payments to foreign nations and apply that waiver to any other 

country that shares a border with America, including nations that 

have questionable ethical practices. The legislation passed by Republicans on the House Natural Resources Committee would leave 

the door open for secret payments by oil companies to foreign nations or officials, which could include unethical actions by a company to gain an advantage or even bribes. 

The Dodd-Frank requirement, otherwise known as the SEC Natural Resource Extraction disclosure rule, is intended to protect investors by allowing them to know if a company is making questionable payments to a government that could expose the company to 

civil liability or even criminal sanctions. It also aims to increase 

transparency regarding resource extraction projects in the developing world, thereby eliminating the so-called ‘‘resource curse’’ that 

has plagued many developing countries for decades by creating a 

cycle of corruption in their governments. 

Allowing such secret payments is not only unwise, it is also unwarranted. The SEC already has the authority to provide waivers 

from the Dodd-Frank disclosure requirement should it be warranted. The SEC has general exemption authority under Sections 

12(h) and 36 of the Securities Exchange Act of 1934. The SEC can 

‘‘exempt any person, security, or transaction, or any class or classes 

of persons, securities, or transactions’’ using this authority ‘‘to the 

extent that such exemption is necessary or appropriate in the public interest, and is consistent with the protection of investors.’’ If 

a situation arises where such a waiver is needed, the SEC already 

has the authority it needs to exempt companies from the disclosure 

requirement. We should not provide a blanket exemption as is included in the underlying bill. 

This legislation is intended to expand and facilitate offshore drilling but the Majority continues to do nothing to implement the recommended safety reforms following the BP spill. The entity formed 

out of the BP Spill Commission recently released another report 

card to assess the response to the spill. It gave Congress a ‘‘D+’’. 

That is something we should be ashamed of. 


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23 

A recent report from the Democratic staff of the Committee underscores the continued need for Congress to act. The report found 

that oil companies that were engaged in risky drilling practices before the BP spill continue to do so. In part, that is because Congress has not taken action to enact reforms that cannot be accomplished without an act of Congress to ensure there is a sufficient 

financial deterrent for these companies engaged in risky drilling 

behaviors. 

Representative Rau ́l Grijalva (D–AZ), offered an amendment to 

the bill to strike the Republican disclosure waiver, which was rejected by the Majority. The Majority also voted down an amendment offered on behalf of Energy and Mineral Resources Subcommittee Ranking Member Rush Holt (D–NJ) that would have 

implemented key oil drilling safety reforms recommended following 

the BP spill, such as raising the liability cap for offshore oil spills 

and increasing the fines that the Interior Department can levy 

against oil companies who violate the law. 

We should be working together to address these issues. Yet the 

Majority continues to pass partisan legislation that benefits the oil 

industry and does nothing to ensure that we protect our environment, economy and workers from another disaster like the BP 

Deepwater Horizon. 

EDWARD J. MARKEY. RAU ́ L M. GRIJALVA. RUSH HOLT. 

Æ 


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