[Senate Executive Report 105-4]
[From the U.S. Government Publishing Office]



105th Congress                                               Exec. Rpt.
                                 SENATE

 1st Session                                                  No. 105-4
_______________________________________________________________________


 
               U.S.-MEXICO TREATY ON MARITIME BOUNDARIES

                                _______
                                

                October 22, 1997.--Ordered to be printed

_______________________________________________________________________


          Mr. Helms, from the Committee on Foreign Relations,

                        submitted the following

                                 REPORT

                       [To accompany Ex. F, 96-1]

    The Committee on Foreign Relations to which was referred 
the Treaty on Maritime Boundaries between the United States of 
America and the United Mexican States, signed at Mexico City on 
May 4, 1978, having considered the same, reports favorably 
thereon with one declaration, and one proviso, and recommends 
that the Senate give its advice and consent to the ratification 
thereof as set forth in this report and the accompanying 
resolution of ratification.

                               I. Purpose

    The Maritime Boundaries Treaty with Mexico is intended to 
establish the maritime boundary between the United States and 
Mexico for the area between twelve and two hundred nautical 
miles off the coasts of the two countries in the Pacific Ocean 
and the Gulf of Mexico.

                             II. Background

    In 1970 the United States and Mexico concluded a treaty 
that established maritime boundaries for the two countries in 
both the Gulf of Mexico and the Pacific Ocean to a distance of 
twelve nautical miles. That treaty went into effect in 1972. 
Subsequently, Mexico claimed an exclusive economic zone, and 
the United States a fisheries management zone, extending 200 
nautical miles from their shores. Negotiations to establish 
maritime boundaries for these expanded regions resulted in a 
provisional agreement in 1976, and mutual satisfaction with 
those provisional boundaries led to their incorporation in the 
``Treaty on Maritime Boundaries Between the United States of 
America and the United Mexican States'' in 1978.
    The treaty was submitted to the Senate on January 23, 1979, 
together with maritime boundary treaties with Venezuela and 
Cuba. The treaty with Mexico replicated the terms of the 
provisional agreement of 1976 in four articles. The first 
article sets forth the specific geographic coordinates 
establishing maritime boundaries in three areas--(1) in the 
western Gulf of Mexico eastward from the international boundary 
between Texas and Mexico, (2) in the eastern Gulf of Mexico 
where the 200-mile zones from Louisiana and Mexican islands off 
the coast of Yucatan overlapped, and (3) in the Pacific Ocean 
westward from the international boundary between California and 
Mexico. The second article describes the legal effect of the 
boundaries, providing that neither country shall claim or 
exercise sovereign rights or jurisdiction over the waters or 
seabed and subsoil of the other country's side of the 
boundaries. The third article states that the sole purpose of 
the treaty is to establish maritime boundaries between the two 
countries and that it does not affect or prejudice either 
party's positions on other matters. The fourth article provides 
that the treaty will enter into force on the date instruments 
of ratification are exchanged.
    The Foreign Relations Committee held a hearing on the 
treaty with Mexico, along with those for Venezuela and Cuba, on 
June 30, 1980, and received testimony from State Department 
witnesses (primarily Mark Feldman, Deputy Legal Adviser); 
Hollis Hedberg, a professor emeritus of geology at Princeton 
University; and two witnesses representing the fishing industry 
in California. The latter two witnesses stated that ``the 
entire industry that operates on the west coast of California 
fully supports ratification of the treaty'' with Mexico, and 
the State Department witnesses, of course, also testified in 
support of the treaty. But Dr. Hedberg objected to the 
methodology used in calculating the maritime boundaries in the 
Gulf of Mexico.
    Additionally, concern was voiced during the hearing by 
Senators Zorinsky and Javits regarding the legal basis for 
establishing maritime boundaries on a provisional basis by 
executive agreement prior to the ratification of a treaty. The 
questions were primarily in regard to the treaty with Cuba 
(also considered during the 1980 hearing), which contained a 
specific provision providing that the treaty would be applied 
provisionally for two years pending ratification. But the 1976 
executive agreement with Mexico also remained provisionally in 
effect ``pending final determination by treaty of the Maritime 
Boundaries between the two countries off both coasts.''
    Notwithstanding these matters, on July 24, 1980, the 
Committee voted unanimously to favorably report all three 
treaties to the Senate. The Committee stated in its report:

    It is the Committee's view that ratification of these 
agreements will serve important U.S. interests by delimiting 
these three maritime boundaries in an equitable manner. 
Favorable action on these agreements will ensure that important 
U.S. fishery and seabed and subsoil mineral rights are 
protected. Moreover, the conclusion of these agreements will 
serve U.S. security interests, especially in the Caribbean 
region, facilitate law enforcement activities and strengthen 
the U.S. negotiating positions in future boundary discussions.

    Subsequently, on September 17, 1980, the Senate unanimously 
approved the maritime boundary treaty with Venezuela and 
returned the boundary treaty with Cuba to the executive 
calendar. \1\ The treaty with Mexico was to be considered at 
the same time as the treaty with Venezuela, but one day before 
that date the treaty was removed from the unanimous consent 
agreement providing for consideration of the maritime boundary 
and several other treaties. Sen. Javits explained that the 
delay was to give several senators time to obtain further 
information about the treaty, apparently with respect to the 
oil potential of the Gulf of Mexico. Sen. Byrd said that the 
treaty would be rescheduled for ``early next week,'' but 
further floor action or debate on the treaty never occurred.
---------------------------------------------------------------------------
    \1\ 126 CONG. REC. S 25722-23 (Sept. 17, 1980). Sen. Helms proposed 
an amendment to condition the treaty on the removal of all Soviet 
forces from Cuba and the Western Hemisphere. Sen. Zorinsky proposed a 
substitute amendment expressing the view that the Soviet influence in 
Cuba was a ``grave concern'' to the United States. The Senate refused 
to table the Zorinsky amendment by a vote of 35-58, and Sen. Helms 
proposed a perfecting amendment to condition the treaty on a 
Presidential certification that Cuba was not conducting subversion or 
exporting revolution. The Senate agreed to Sen. Byrd's motion to return 
to legislative session by a vote of 55-37.
---------------------------------------------------------------------------
    Since then, the treaty has remained pending before the 
Committee on Foreign Relations without further action. Mexico 
ratified the treaty in 1978.
    The American Association of Petroleum Geologists (AAPG), 
which supported the testimony of Dr. Hedberg in 1980, informed 
the Committee by letter, dated July 1, 1997, that it no longer 
opposes Senate advice and consent to ratification of the 
Treaty. Specifically, the President of AAPG informed the 
Committee that ``it appears that Dr. Hedberg's long-term goal 
of deep water exploration in the Gulf of Mexico can best be 
achieved by resolution of this matter.''

                              III. Summary

    Three issues were raised during the Committee's previous 
consideration of the maritime boundaries treaty with Mexico--
(1) the method used to calculate the boundaries, (2) the 
allocation to Mexico of a large region in the Gulf of Mexico 
with an undetermined oil potential, and (3) the legality of the 
Administration establishing maritime boundaries on a 
provisional basis by means of executive agreements.
    On the first two issues the debate concerned whether 
islands ought to serve as basepoints for measuring a country's 
economic or fisheries zone. The boundaries in the eastern part 
of the Gulf of Mexico were calculated in part on the basis that 
Mexico's 200-mile claim extended from several Mexican islands 
75 miles north of the Yucatan peninsula rather than from the 
peninsula itself. That gave Mexico a claim to a larger portion 
of the Gulf of Mexico than would have been the case if the 
islands were not used as basepoints. Dr. Hedberg, the Princeton 
geologist, claimed that it would have been more ``logical and 
equitable'' to give each country ``jurisdiction over the water-
covered shelf and slope adjacent to its shores out to the base 
of the continental slope'' and then to divide the deep water 
area remaining between them equally, a method of calculation 
that would have put the maritime boundary further south and 
given the United States more of the Gulf. He suggested that the 
treaty was based on ``not-yet finalized tentative conclusions 
of the Law of the Sea Conference'' which were ``both 
inequitable in principle and prejudicial to the interests of 
the United States,'' and argued in support of his approach that 
``the entire Gulf of Mexico basin is prospective petroleum 
territory.''
    In response, Mr. Feldman, Deputy Legal Adviser, observed 
that not just the eastern Gulf boundary but also the Pacific 
boundary was calculated in part using islands as the base point 
for measuring the 200-mile zone; but in the latter instance, he 
said, the islands, and the benefit from the calculation, 
belonged to the United States. The result, he said, was that 
the Pacific boundary gave the United States a substantial 
region that it would not have obtained using Mr. Hedberg's 
methodology, including four banks of great importance for 
fisheries--Tanner Bank, Cortez Bank, the 40-Mile Bank, and the 
60-Mile Bank. The Gulf area, he said, did not have important 
fisheries; but both regions had undetermined ``hydrocarbon 
potential.'' Moreover, he asserted, using islands as the 
baseline for calculating maritime boundaries was to the U.S. 
advantage elsewhere as well, such as between the Florida Keys 
and Dry Tortugas and Cuba and the boundary with Canada in the 
Gulf of Alaska. He further rejected the claim that the United 
States was following Law of the Sea Conference principles, 
stating that the principles used were drawn from the Geneva 
Convention on the Continental Shelf, from a 1969 decision on 
the North Sea Continental Shelf Cases by the International 
Court of Justice, and a 1977 Court of Arbitration decision on 
an Anglo-French dispute. \2\ Finally, he emphasized that the 
boundary treaty was not a theoretical enterprise but was a 
negotiated agreement and that it would not have been possible 
to get an agreement with Mexico using Dr. Hedberg's principles.
---------------------------------------------------------------------------
    \2\ In a subsequent article, Mr. Feldman stated that the ``line was 
based on the methodology used in drawing the 12-nautical mile maritime 
boundary in the 1970 U.S.-Mexico Treaty--a simplified equidistance 
line, with equal area tradeoffs, giving full effect to islands.'' See 
Feldman & Colson, ``The Maritime Boundaries of the United States,'' 75 
A.J.I.L. 729, 743 (1981).
---------------------------------------------------------------------------
    Senators Zorinsky and Javits both also raised concerns with 
the State Department concerning the legality of the provisional 
application of maritime boundaries pursuant to executive 
agreement rather than treaty. The Administration asserted that 
precedent existed for the establishment of provisional maritime 
boundaries by executive agreement, that authority to establish 
boundaries for fisheries purposes was provided by the Fishery 
Conservation and Management Act of 1976, and that the President 
had the responsibility under the Constitution for the conduct 
of foreign affairs. In reporting the treaties to the Senate, 
the Committee expressed its disagreement with these assertions:

    * * * [T]he Committee wishes to register its concern on the 
issue of provisional application of treaties. The 
Administration has argued in its responses to Senator Javits 
that the President may apply a treaty provisionally in advance 
of Senate advice and consent so long as ``the obligations 
undertaken'' are ``within the President's competence under U.S. 
law.'' This phrase simply begs the question of how broad such 
competence might be. While the Committee does not dispute the 
practical necessity of reaching limited practical 
accommodations between treaty signatories prior to Senate 
action, it does not accept the broad and vague assertions made 
by the Administration in its response.

                  IV. Entry Into Force and Termination

                          a. entry into force

    The Treaty provides that it shall enter into force upon the 
exchange of instruments of ratification in Washington, D.C. 
(Article IV).

                             b. termination

    The Treaty does not provide for a specific withdrawal date 
and cannot be terminated. It is customary practice not to 
include a withdrawal mechanism in treaties that delimit 
boundaries since these treaties are used as the basis for 
granting rights based on the delimitations.

                          V. Committee Action

    As detailed in the background section, the Committee on 
Foreign Relations held a public hearing on June 30, 1980, and 
unanimously ordered the proposed treaty favorably reported on 
July 24, 1980. The treaty was not considered by the full Senate 
and was automatically rereferred to the Committee under 
paragraph 2 of Rule XXX of the Standing Rules of the Senate. A 
second public hearing was held on the proposed treaty on 
September 25, 1997. \3\ The hearing was chaired by Senator 
Chuck Hagel. The Committee considered the proposed treaty on 
October 8, 1997, and ordered the proposed treaty favorably 
reported with one declaration and one proviso by voice vote, 
with the recommendation that the Senate give its advice and 
consent to the ratification of the proposed treaty.
---------------------------------------------------------------------------
    \3\ The transcript of this hearing may be found in the appendix to 
the Committee's report on the Migratory Bird Protocol With Canada and 
the Migratory Bird Protocol With Mexico, also filed this day.
---------------------------------------------------------------------------

                         VI. Committee Comments

    The Committee favorably recommends the treaty for Senate 
advice and consent. Since consideration of this Treaty in 1980 
oil and gas exploration has moved closer to the 200 nautical-
mile limits set out in the Treaty. The Committee notes the 
untapped reserves of crude oil and natural gas in the Gulf of 
Mexico along the 200 nautical mile boundary and the 
technological advances that have made it more likely that U.S. 
companies will recover these oil and gas deposits. The 
Committee believes that ratification of this treaty will 
advance the exploration and development of this area.
    Beyond the 200 nautical-mile delimitation of both countries 
lie two ``donut hole'' or ``gap'' areas that are not addressed 
by the Treaty. The Administration has informed the Committee 
that following ratification of this Treaty it intends to 
propose to Mexico that negotiations begin to delimit the 
continental shelf in a portion of the shelf known as the 
``western gap.'' Delimitation of the western gap has become 
increasingly important to U.S. interests as petroleum 
exploration has moved into deeper waters. The Department of 
Interior is now receiving bids for exploration in this area. 
Several new drilling vessels capable of operating in water 
depths of up to 10,000 feet are under construction. The 
Committee may have preferred a treaty that addressed the gap 
areas in addition to the areas delimited and avoided the need 
to address these issues in two separate instruments. However, 
given the long delay in ratification, the Committee supports 
ratification of the proposed treaty at this time, to be 
followed by further negotiations with Mexico to delimit the gap 
areas. The Committee urges the Executive Branch to commence 
negotiations on the western gap without delay, once this treaty 
enters into force.
    Finally, the Committee wishes to reiterate the concerns it 
expressed during consideration of the Treaty in 1980 regarding 
the legality of the provisional application of maritime 
boundaries pursuant to executive agreement rather than treaty. 
The Administration stated in response to questions for the 
record from Senator Helms that establishing provisional 
boundaries ``was within executive power vested in the 
President.'' The Committee remains concerned about how broad 
such competence might be, and questions the legal basis for 
this position. The Executive's own testimony suggests that it 
has doubts about its legal position in reaching such 
``provisional agreements.'' During the Committee hearing on the 
treaty, the State Department testified that ``for commercial 
reasons industry needs the certainty provided by this 
boundary.'' It should go without saying that if the 
``provisional agreement'' has a legal basis, then it would 
provide the certainty sought by U.S. commercial interests. In 
sum, while the Committee does not dispute the practical 
necessity of reaching limited practical accommodations between 
treaty signatories prior to Senate action, it continues to 
object to the broad and vague assertions made by the 
Administration.

                    VII. Resolution of Ratification

    Resolved, (two-thirds of the Senators present concurring 
therein), That the Senate advise and consent to the 
ratification of the Treaty on Maritime Boundaries between the 
United States of America and the United Mexican States, signed 
at Mexico City on May 4, 1978 (Ex. F, 96-1), subject to the 
declaration of subsection (a), and the proviso of subsection 
(b).
    (a) DECLARATION.--The Senate's advice and consent is 
subject to the following declaration, which shall be binding on 
the President:
        (1) TREATY INTERPRETATION.--The Senate affirms the 
        applicability to all treaties of the constitutionally 
        based principles of treaty interpretation set forth in 
        Condition (1) of the resolution of ratification of the 
        INF Treaty, approved by the Senate on May 27, 1988, and 
        Condition (8) of the resolution of ratification of the 
        Document Agreed Among the States Parties to the Treaty 
        on Conventional Armed Forces in Europe, approved by the 
        Senate on May 14, 1997.
    (b) PROVISO.--The resolution of ratification is subject to 
the following proviso, which shall be binding on the President:
        (1) SUPREMACY OF THE CONSTITUTION.--Nothing in the 
        Treaty requires or authorizes legislation or other 
        action by the United States of America that is 
        prohibited by the Constitution of the United States as 
        interpreted by the United States.



                            A P P E N D I X

                              ----------                              


                          U.S. Department of State,
                                      Washington, DC 20520,
                                                   October 2, 1997.
The Hon. Jesse Helms,
Chairman,
Committee on Foreign Relations,
United States Senate.

    Dear Mr. Chairman: Following the September 25, 1997 hearing at 
which the Honorable Mary Beth West testified, additional questions were 
submitted for the record. Please find enclosed the responses to those 
questions.
    If we can be of further assistance to you, please do not hesitate 
to contact us.
      Sincerely,
                                    Barbara Larkin,
                                       Assistant Secretary,
                                               Legislative Affairs.


    Responses of Mary Beth West to Questions Asked by Senator Helms
    Question 1. The exchange of notes accompanying the treaty stated 
that the two parties would recognize the provisional boundaries set 
forth in the notes ``pending final determination by treaty of the 
Maritime Boundaries between the two countries off both coasts.'' The 
Committee opposed the ``provisional'' boundary in 1980. What is the 
legal basis for determining maritime boundaries by executive agreement? 
Doesn't the fact that the Administration, in its testimony before the 
Committee last week, cited the need for ``legal certainty'' as to the 
border between the U.S. and Mexico indicate that the ``provisional'' 
boundary is not an appropriate legal instrument for settling 
boundaries?
    Answer. The Administration fully acknowledges and respects the role 
of the Senate in the treaty making process. The exchange of notes 
associated with this treaty, which stated that the two parties would 
recognize the provisional boundaries set forth in the notes pending 
final determination by treaty, was within executive power vested in the 
President, and did not prejudice the prerogatives of the Senate 
regarding the provision of advice and consent.
    As a practical matter, the Administration has viewed the 
provisional boundary reflected in the exchange of notes as a 
transitional tool which, pending entry into force of the treaty, has 
facilitated the exercise of jurisdiction by each side in its respective 
200-mile zone. It should be remembered that, at the time of the 
exchange of notes, the United States and Mexico had recently 
established their respective 200-mile zones. The provisional boundary 
dividing these zones has greatly reduced the likelihood of disputes 
concerning, inter alia, where fishing vessels of each country could 
operate.
    Question 2. The maritime boundaries treaty with Mexico addressed 
only those areas in the Gulf where U.S. and Mexican claims overlapped, 
and as a result left a gap of about 129 miles between the eastward and 
westward boundaries where there was no overlap. That gap was justified 
in part on the basis that negotiations over the reach and allocation of 
the continental shelf were still in process in the Law of the Sea 
proceedings. Is Mexico prepared to negotiate a follow-on treaty 
delimiting the ``gap'' areas?
    Answer. We have raised the issue of delimiting the continental 
shelf in the western gap with Mexican Government officials, and have 
been informed that their desire was first to get the 1978 Treaty in 
force. It is our intent, at the time instruments of ratification are 
exchanged for the 1978 treaty, to propose early talks to establish a 
continental shelf boundary in this 129-mile gap.
    Question 3. Action on the treaty in 1980 was apparently forestalled 
because of concerns about the oil potential of the Gulf region ceded to 
Mexico. What is the oil potential of the Gulf Region claimed by Mexico? 
By the United States? What is the oil potential of the Pacific Region 
claimed by the United States? Of Mexico? Does the technology exist to 
exploit that potential? What is the realistic timetable for 
exploitation of these regions?
    Answer. The resource potential in the boundary areas was discussed 
in the 1982 U.S. Geological Survey study submitted to the Committee. A 
more recent general assessment for the Gulf of Mexico by the Minerals 
Management Service (MMS) did not evaluate the specific boundary areas. 
The estimate for the area between 900 meters water depth and the 
Sigsbee Escarpment in the Gulf was between 3.0 and 5.4 billion barrels 
of oil and 34.2 and 39.4 trillion cubic feet of natural gas. Recent 
exploratory drilling elsewhere beyond the Sigsbee Escarpment has 
indicated that hydrocarbon accumulations do exist within these 
sediments. Thus, the area adjacent to the U.S. Mexico boundary in the 
Gulf of Mexico is an area of high potential, as confirmed by recent 
industry interest.
    The southern California maritime boundary area includes the 
prospective Cortes-Velero-Long basins. The U.S. portion of this 
boundary area was estimated to contain potential quantities of 
undiscovered petroleum resources ranging between 0 and 1.2 billion 
barrels of oil and 0 to 3.5 trillion cubic feet of natural gas.
    As indicated by recent bidding and exploration activity, current 
technology is advancing to allow exploration in the boundary areas. 
Such exploration might proceed within a few years after lease issuance. 
The timetable is difficult to assess since technology would be unique 
to the area, size of discovery, whether it is oil or gas (or both), 
etc. In adjacent deeper water areas, development plans propose 
production within several years after successful exploration. In 
general, we would expect the timing to depend on the size of the 
resource discovered.
    Question 4. What has been the political impact of the U.S. failure 
to ratify the treaty to date? Does Mexico's ratification of the treaty 
still stand?
    Answer. Mexico ratified the 1978 Treaty in 1979. The political 
impact of U.S. failure to ratify has been minor, the Government of 
Mexico has considered this a bilateral irritant, and has raised the 
issue in discussions with the U.S. Government many times over the last 
17 years. The Government of Mexico continues to express an interest in 
seeing the U.S. ratify the treaty. We would expect an early exchange of 
instruments of ratification and entry into force of the treaty 
following the receipt of advice and consent to ratification by the 
Senate.


 Prepared Statement of the American Petroleum Institute, the Domestic 
 Petroleum Council, the Independent Petroleum Association of America, 
    the International Association of Drilling Contractors, the Mid-
 Continent Oil and Gas Association, and the National Ocean Industries 
                              Association

         Submitted to the Senate Committee on Foreign Relations
                   Hearing on the Ratification of the
                  U.S.-Mexico Maritime Boundary Treaty
                           September 25, 1997

    Mr. Chairman and Members of the Committee:
    The American Petroleum Institute, the Domestic Petroleum Council, 
the Independent Petroleum Association of America, the International 
Association of Drilling Contractors, the Mid-Continent Oil and Gas 
Association, and the National Ocean Industries Association appreciate 
this opportunity to provide the Committee with our views on the 
ratification of the U.S.-Mexico Maritime Boundary Treaty. The six trade 
associations represent virtually the entire oil and gas exploration and 
production and service industry in the Gulf of Mexico.
    The U.S. and Mexico signed the Maritime Boundary Treaty in 1978. 
Mexico ratified the treaty in 1979; the U.S. Senate considered, but did 
not vote on, ratification in 1980. Although the U.S. and Mexico have 
continued to honor the provisional boundary, it has become important to 
U.S. economic interests that the treaty be ratified. The oil and gas 
industry fully supports Senate ratification of the treaty.

Background

    In 1978, the U.S. and Mexico signed a maritime boundary treaty 
which divided the seabed, subsoil, and water column between the U.S. 
and Mexico off the Pacific Coast and in the Gulf of Mexico. The purpose 
of the treaty was to establish a permanent maritime boundary and 
eliminate overlapping jurisdictional claims between the U.S. and Mexico 
for fishing grounds, oil and natural gas, and other natural resources.
    Under the treaty, the maritime boundary was drawn as an equidistant 
line from the coast lines of the two countries giving full effect to 
habitable islands. The treaty divided the areas where Mexican and U.S. 
exclusive economic zones (EEZs) overlapped, but left two areas, 
referred to as the eastern and western ``donut holes'' or gaps, 
unresolved. These two gaps are beyond the 200 mile EEZ claimed by both 
countries. (The eastern gap is bounded by U. S., Mexican, and Cuban 
EEZs.)
    The treaty was submitted to the U.S. Senate in January 1979 for 
ratification. On July 24, 1980, the Foreign Relations Committee 
unanimously and without reservation recommended ratification of the 
treaty to ``ensure that important U.S. fishery and seabed and subsoil 
mineral rights are protected.'' The treaty had the strong support of 
the U.S. tuna industry because it gave the U.S. jurisdiction over one 
of the world's major tuna areas in the Pacific. The treaty was 
scheduled for consideration by the full Senate in September 1980 when a 
Senator requested that it be pulled from the calendar. A concern had 
been raised by Hollis Hedberg, a noted petroleum geologist, that the 
U.S. had traded potential Gulf of Mexico oil and gas resources for 
fishing grounds off the Pacific Coast. Dr. Hedberg proposed an 
alternative geology-based theory for drawing the equidistant line, not 
including the use of islands off the coast of the Yucatan Peninsula, 
which would have moved the boundary farther south in the Gulf of 
Mexico. The Senate requested that the U.S. Geological Survey conduct a 
study of petroleum resources in the area, which was completed in 1981. 
No further action has been taken on the treaty since that time.

Reasons For Ratification

Consistent With International Law Principles. The principles used by 
the State Department in negotiating the maritime treaty were generally 
recognized international law principles at the time the treaty was 
negotiated and have since been reaffirmed in other negotiations. This 
is significant because, if the boundary were being negotiated today, 
those same principles of international law would be used and would 
result in virtually the same boundary.

Use Of Islands. The principles used in negotiating the boundary were, 
and remain, consistent with the general U.S. interest of giving full 
effect to islands off the U.S. coast. For example, the boundary 
agreement with Cuba gives full effect to the Florida Keys and the Dry 
Tortugas. The U.S. has other important island interests, including the 
Alexander Archipelago in southeastern Alaska affecting the maritime 
boundary with Canada.

U.S. Economic And Energy Interests. When this treaty was last debated, 
technology did not exist to allow companies to evaluate or develop the 
deeper waters of the Gulf immediately adjacent to the boundary. Today, 
industry has the technology to explore for oil and gas in water depths 
up to 10,000 feet and to produce hydrocarbons in over 5,000 feet of 
water. To ensure the orderly development of these valuable deep water 
Gulf of Mexico resources and maximize federal revenues, it is in the 
interest of the U.S. to promptly ratify the treaty and to commence 
negotiations on the western gap as soon as possible thereafter.

Gap Negotiations. Senate ratification of the treaty will clear the path 
for further negotiations between the U.S. and Mexico on the western 
gap, a 4.5 million acre unexplored area more than 200 miles from either 
country's border which was left undivided in the initial treaty. The 
Mexican government has indicated informally to the Department of State 
that it will not entertain negotiations over the gaps until the U.S. 
ratifies the 1978 agreement. Once resolved, leases within the western 
gap could potentially generate significant revenues for the Treasury. 
For example, the August 1997 lease sale in the western Gulf of Mexico 
generated bids of over $734 million for leases in 800+ meters of water 
with $9.1 million being offered for a single deep water lease.

Support For Ratification

    Aside from the potential oil and gas resource issue, there was no 
opposition to treaty ratification in 1980. Oil and gas interests now 
fully support prompt ratification of the treaty. We appreciate the 
opportunity to provide these comments.

                               __________

      Prepared Statement of Shell Exploration & Production Company
         Submitted to the Senate Committee on Foreign Relations
   Hearing on the Ratification of the U.S.- Mexico Maritime Boundary 
                                 Treaty
                           September 25, 1997

Mr. Chairman and Members of the Committee:
    Shell Exploration & Production Company through its subsidiaries - 
Shell Offshore Inc., Shell Deepwater Development Inc., and Shell 
Deepwater Production Inc. - is a leading producer of hydrocarbons and 
the largest leaseholder in the Gulf of Mexico. Shell has been operating 
in the Gulf of Mexico for four decades. As a major Gulf of Mexico 
stakeholder, Shell is pleased to go on record in support of Senate 
ratification of the U. S. Mexico Maritime Boundary Treaty.
    The United States and Mexico signed a maritime boundary treaty in 
1978 which divided the seabed, subsoil, and water column between the 
United States and Mexico off the Pacific Coast and in the Gulf of 
Mexico. It recently came to industry's attention that the U.S. - Mexico 
Maritime Boundary Treaty had not been ratified by the United States 
Senate. This led to a thorough review of the issue within industry. As 
the attached map clearly depicts, existing offshore leases run from the 
shores of Gulf Coast states up to and abutting the provisional maritime 
boundary. Given the number of leases in close proximity to the 
provisional boundary, it is not surprising that the industry is unified 
in its support for prompt treaty ratification.
    When this treaty was considered by the Senate almost two decades 
ago, oil and gas activities were limited to the shallow waters of the 
Gulf of Mexico. Since then, technological advances have opened the 
deepwater frontier for petroleum exploration and production leading to 
a renaissance in the Gulf of Mexico. The deepwater Gulf has developed 
into one of the premiere exploration plays in the world today. Shell 
has been a leader in industry's march into deepwater, setting numerous 
deepwater records in the process - all in the Gulf of Mexico. 
Industry's increased activity level has resulted in thousands of new 
jobs and billions of investment dollars flowing into the Gulf Coast 
economy and has generated hundreds of millions of dollars in revenue 
for the U. S. treasury.
    As these deep water activities inch closer and closer to the 
provisional boundary, it becomes increasingly important that the Senate 
ratify the treaty. This is an issue whose time has come, and Shell 
strongly encourages the Senate to ratify the treaty promptly. 
Expeditious action by the Senate will complete action on the treaty 
itself and will allow Mexico and the United States to begin 
negotiations to delimit the western gap, a 4.5 million acre area more 
than 200 miles from either country's border left undivided in the 
initial treaty. More importantly, ratification of this treaty is in the 
best interest of the Nation and is critically important to the Gulf 
Coast economy.




