Analyst: GOM Cross-Border Oilfields Unlikely
Source: Business News Americas, David Biller (6/25/10)
". . .no such cross-border fields have been identified to date."
The two governments released a joint statement on June 23 declaring their goal of a cross-border development new agreement for along the entire border.
Shields said he views the press release as a routine follow-up to the May 19 meeting of U.S. and Mexican presidents Barack Obama and Felipe Calderon in order to send the signal that they plan, eventually, to deal with the cross-border issue.
"They said the same thing years ago. Personally, I wouldn't expect much to come of it," Shields said.
Though there has been the concern in Mexico that U.S. companies could drill up to the border even without an established agreement for joint production, Obama and Calderon's meeting last month took place in the context of the Deepwater Horizon oil spill in the Gulf of Mexico. In the wake of the accident, urgency has "virtually disappeared" for cross-border drilling, Shields said.
"I don't see even Chevron, ExxonMobil, Unocal, BP or anyone else going ahead with deepwater drilling at this point in the cross-border area. I think they're focused on understanding what happened, and monitoring political and social reaction to what has happened," he said.
The joint statement also highlights that no such cross-border fields have been identified to date, which Shields says provides little reason to believe much will happen in the immediate future to produce such fields.
The statement did announce one solid advance—the extension by three years of the moratorium on drilling on a stretch of the border 2.8 nautical miles (5.19km) wide transecting the area known as the Western Gap. The treaty now runs through January 2014.