[House Report 113-101]
[From the U.S. Government Publishing Office]


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 implement 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.''.

       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.
    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 Pena 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 Management 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 legislation 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 Raul 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:


    Congressman Raul 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:


    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:


            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 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 
offsetting 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.
---------------------------------------------------------------------------
    \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.
---------------------------------------------------------------------------
    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-as-you-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-You-Go 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, 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 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.
        
        

                            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 
Dodd-Frank 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.
    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 Raul 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.
                                   Raul M. Grijalva.
                                   Rush Holt.