American vessels wait for work and resolution of conflicts in the Gulf

Since 2009, Louisiana company Hornbeck Offshore Services has spent $600 million building ships to help with deepwater drilling construction. But competition from foreign ships and foreign workers has kept Hornbeck from putting those ships in the water, said CEO Todd Hornbeck.

Now, Hornbeck and other maritime workers are hopeful that policy changes will take scale back foreign competition for American offshore oil, providing jobs and business for American companies looking to work in the Gulf.

“Foreign competition could come in with much lower crew wages,” said Hornbeck. “We just could not compete in that type of situation. It’s been crippling to our industry not being able to help with this equipment.”

While thousands of oil and gas professionals converge on Houston for the Offshore Technology Conference this week, Hornbeck and others are waiting for Trump administration to review the law that would bring them business. But the administration’s interpretation of the law, known as the Jones Act, which mandates that only U.S.-owned vessels move equipment in U.S. waters, could pit some of Trump’s key constituents against each other.

Over the decades U.S. customs officials made a series of exemptions to the act, allowing oil and gas companies to employ foreign vessels to perform specific tasks such as moving the fluid that drillers use to lubricate wells between sites or laying down massive subsea equipment that can weigh hundreds of tons.

But just days before Trump’s inauguration, Customs and Border Patrol announced that it would no longer grant exceptions to the law and would require all-American crews and ships to be working in the Gulf. The administration is expected to release its determination on the law’s enforcement by May 18.

In 2009, there weren’t enough American vessels to respond to the industry’s needs, said Hornbeck. So companies responded by building vessels, and on Tuesday Hornbeck said he has three crewed vessels ready and waiting for work.

But oil and gas drillers have said that forcing them to comply with the Jones Act would force offshore projects to shut down, and that company’s like Hornbeck’s don’t have enough vessels to meet the industry’s demand.

 

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