Nevertheless, the cross-border hydrocarbon agreement is not a turning point for U.S. oil production – given the huge investments required for deepwater research and development and the fact that opening up these proven and potential reserves adds less than one percentage point to all U.S. reserves. But what the agreement represents is a step forward in bilateral relations, which shows that the two North American neighbors can cooperate on a politically sensitive issue for a long time. The cross-border agreement removes uncertainty about the development of cross-border resources in the resource-rich Gulf of Mexico. As a result of the agreement, nearly 1.5 million hectares of the U.S. outer continental shelf will now be more accessible for exploration and production activities. According to estimates by the Interior Ministry`s Bureau of Ocean Energy Management (BOEM), the area contains up to 172 million barrels of oil and 304 billion cubic feet of natural gas. The agreement also opens up resources in the Western divide, which were not available to both countries under a previous treaty that imposed a moratorium along the border. Second, the assertion that an exemption from transparency is necessary to protect the competitiveness of the United States on the Mexican side of the border is unfounded. Some proponents of the exemptions argue that this is necessary because Mexico could create a legal framework prohibiting disclosure of payments by foreign companies. However, the cross-border agreement provides that certain information is treated confidentially, unless national law requires disclosure.
For example, the United States and Mexico have already agreed that national governments should decide whether to disclose payments. When formal negotiations for the TBA began in September 2011, Mexico joined the agreement more than a year after the Cardin-Lugar Law. In other words, the TBA protects companies that, under current U.S. law, must disclose payments. The cross-border agreement also provides for joint inspection teams from the Office of Safety and Environment Enforcement and the Mexican government to ensure compliance with existing laws and regulations. The relevant authorities on both sides of the border will review all plans for the development of cross-border reservoirs and additional requirements can be established before development activities can begin. Senior Mexican government officials have indicated that the cross-border agreement could provide decisive momentum to the comprehensive energy reforms proposed by President Pea Nieto on August 12, 2013. Implementation would help to demonstrate that the interests of Mexico`s energy sector could be protected and that global energy security could be enhanced by common production regimes. This would strengthen the arguments of Mexican officials who must convince their colleagues and the public that reforms in the constitutional energy sector benefit Mexico`s national interests, a claim that is still somewhat at odds with a powerful and decades-old Mexican narrative. If the United States does not adopt the cross-border agreement and sign support for the reforms, the Mexican government is happy to cooperate with the United States.