A joint trade group has come together to fight plans to change the way the Jones Act is interpreted and debunk what sources claim are ‘myths’ propagated about the vessels and operations affected by the proposed changes.
The joint trade group opposed to the changes includes the American Petroleum Institute, Association of Diving Contractors International, Independent Petroleum Association of America, International Association of Geophysical Contractors, International Marine Contractors Association (IMCA), Louisiana Mid-Continent Oil and Gas Association, Offshore Operators Committee, the US Chamber of Commerce and the US Oil and Gas Association. The group has held meetings with numerous politicians in Gulf Coast states to alert them to what it believes are the significant adverse implications of the changes.
Members of the International Association of Drilling Contractors (IADC) say they are concerned by the uncertainties associated with the proposed changes, and IADC is participating in a joint effort with the associations named above in order to better understand the implications of the changes. However, the association has not taken a position either in support of, or in opposition to them.
The Offshore Marine Services Association (OMSA) claims that the vessels most directly affected by proposed changes put forward by Customs & Border Patrol (CBP) are light construction vessels of a type of which there is a growing number in the US with several under construction. However international owners say the CBP notice would expand the scope of the Jones Act well beyond light construction vessels to include many other vessels types and operations conducted by foreign flag ships, which have historically have been outside the scope of the Jones Act.
“We are concerned about all areas of deepwater construction,” a source told OSJ. “OMSA misleads its audience by focusing on vessels where they have some capability – such as light construction vessels – and claims the changes will not affect other areas. This is naïve as the changes will affect all kinds of activity.”
Opponents of the changes point out that there are no Jones Act deepwater vessels capable of heavy lift or pipelay activity. There are no Jones Act vessels with the necessary heavy lift capabilities required to install topsides or other similar large lift operations without dismantling the components or topsides, requiring reassembly on the outer continent shelf, they say.
Opponents of the CBP notice say a lack of the deepwater capable pipe-laying, heavy lift, and well intervention vessels, and a short fall of deepwater capable light construction vessels along with the operational restrictions imposed on foreign flag vessels under the CBP notice could halt almost all deepwater E&P activity in the Gulf of Mexico. Organisations concerned about the CBP notice say restricting foreign-flag vessels will slow down or even shut down offshore operations and result in loss of US jobs and revenues. Companies could be forced to build components in foreign yards and/or transport components from foreign yards or simply stop investing in work in the Gulf of Mexico, they say.
Opponents of the CBP notice also claim that if foreign-flag vessels that engage in industrial activity in the Gulf of Mexico are banned Gulf coast ports will also suffer. “Foreign-flag vessels routinely support Gulf Coast ports,” said a source. “There are significant spool bases in Mobile, Gulfport, Ingleside and Port Isabel. If foreign-flag pipelay vessels go away then so does their need for support.” Offshore fabrication facilities will also suffer, it is claimed.
For more information about the issue, see a forthcoming feature on this website.