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Senate Passes Budget Deal that Includes U.S.-Mexico Treaty

Over the objections of Republican leaders, the Senate Wednesday overwhelmingly passed a two-year bipartisan budget deal that includes a treaty that would remove the ban on oil and natural gas development along the U.S.-Mexico boundary in the Gulf of Mexico.

The upper chamber approved the agreement by a 64-36 vote. Only a simple majority (51) was required for the measure to clear the Senate. The bill is headed to the White House for President Obama's signature.

Minority Leader Mitch McConnell of Kentucky accused the Democratic majority of trying to push the budget agreement, which was negotiated by Senate Budget Committee Chairman Patty Murray (D-WA) and House Budget Committee Chairman Paul Ryan (R-WI), "through the Senate without giving the minority the [chance] to offer one amendment."

"This bill isn't exactly what I would  have written on my own," conceded Murray, but it is a compromise, which could prevent another government shutdown in a few short weeks. "The American people are sick and tired of the kind of crisis [situations]" that have paralyzed Washington, DC, Murray said.

Congress will still have some heavy lifting to do in 2014. It will have to pass a dozen appropriation bills based on the budget agreement. The budget agreement cleared the House last Thursday by a 332-94 vote (see Daily GPI, Dec. 13).

Approval of the U.S-Mexico transboundary agreement, which Mexico has approved and which has been languishing in the U.S. Congress for almost two years, along with other important measures, would lift the existing moratorium on nearly 1.5 million acres of the Western Gap of the Outer Continental Shelf, making them available for development. The Interior Department's Bureau of Ocean Energy Management estimates that those acres could contain up to 172 million bbl of oil and 304 Bcf of natural gas.

The budget deal does not require producers that develop oil and gas resources along the U.S.-Mexico boundary in the Gulf to disclose payments associated with resource extraction to the United States or foreign governments.

The deadline for ratifying the transboundary agreement in the United States is Jan. 17. The U.S.-Mexico agreement was first signed in February 2012, and Mexico ratified it in April 2012 (see Daily GPI, Feb. 22, 2012).

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