Is the Jones Act slowing Gulf Spill clean-up efforts?


July 22, 2010

Packed rally protests drilling moratorium

BOEMRE Director Michael Bromwich, the official responsible for implementing the administration's drilling moratorium, has put Lafayette, La. on the list of places where he will be leading a series of public meetings to collect information and views about deepwater drilling safety reforms, blowout containment, and oil spill response. He may be in for a lively reception.

About 11,000 people packed the "Rally for Economic Survival" held yesterday at Lafayette's Cajundome, to protest the drilling moratorium. Though the rally was largely ignored by national media, the embedded video on this page gives an indication of its size and mood.

A highlight of the event was a speech by Louisiana Governor Bobby Jindal.

Governor Jindal said, "I want us to send a clear message to Washington, D.C. today - our people don't want a BP check, our people don't want an unemployment check, our people want this arbitrary moratorium to end so they can go back to work.

The Governor told the stories of three people to highlight the devastating impact the Administration's moratorium is having on Louisianians.

First, the Governor recognized Lori Davis and her company Rig-Chem - a family-owned chemical manufacturing and distribution company that has served the energy industry for over 30 years. Rig-Chem is a small business whose deepwater drilling clients accounted for over 70 percent of their business.

Governor Jindal said, "Through hard work, Rig-Chem was able to become a competitor in this market and they finally thought they had reached security in their company. Then the moratorium hit. Now, Lori says she has all but forgotten plans for expansion and remodeling. She says they are not even a thought anymore. Her employees are scared, she says, because they do not know what tomorrow may bring.

"Initially, the company went into what they referred to as 'Hurricane Mode,' thinking that they would be able to quickly bounce back as they had done time and again when storms hit in the past. But Lori realized they were working with the wrong mentality. She said, 'When you know what you're having to face you can fight those battles, but now we are fighting the battle against the government, against people that are supposed to help and protect us in difficult times.'

"Lori says Rig-Chem has had no debt and has never been dependent on anyone else to support itself. Due to the moratorium and the company's uncertainty, Lori has gone to the bank to establish a line of credit in hopes to ensure the future of her company. Lori said she will never forget the day she watched boatloads of equipment coming in from offshore recently - after they had likely demobilized a rig. She said 'It's a helpless feeling watching all that come back in when you know there is nothing you've done to cause this, or nothing you can do to change it but keep talking about it and hope that people understand.'"

Rig-Chem is now working to change its focus by creating more international business opportunities. The company is having to consider sending employees overseas instead of keeping jobs here in Louisiana.

The Governor said, "Having our small, family-run companies relocate jobs abroad in a national recession is the exact opposite of the strategies we should see coming out of Washington."

Second, the Governor profiled Cory Kief who is the president of Offshore Towing, Inc., a consortium of four companies in Larose that move drilling rigs in shallow water. Although Offshore Towing does operate in shallow water, they are being affected by the "de facto moratorium" there by which the federal government has reduced shallow-water permits almost to a grinding halt.

Governor Jindal said, "Cory told us about mass confusion with the federal government's regulators. He said he is unable to plan because there is too much uncertainty in the permitting process. He said he had only heard of one new drill permit being issued for shallow water drilling since the moratorium and that he's already had to lay off one employee and fears for the future. He said 'Right now it's a short term problem, but if they don't resolve the issues in short order it's going to be a long term problem. Which means having to tie up equipment and send people home. We are looking at that every day.'

Third and finally, the Governor recognized Dwayne Rebstock who is the CEO of Allport Services. In October 2007, Allport opened its doors as a logistics brokerage company in Port Fourchon. On March 1 of this year, the company debuted its new Multi Service Dock Facility. The new facility boasted 600 feet of waterfront property and 11 acres of area overall. This multi-service dock facility would support drilling and production in the Gulf. Soon after its expansion, Allport signed a major client, indicating a rising interest in the new facility. Then, the moratorium was issued just weeks later and Rebstock's first major client backed out - on the exact date the moratorium was enacted.

Governor Jindal said, "Allport is now working spot jobs because as Dwayne puts it, 'no major company will make a move, we're all just waiting to see what the President will do.' To make ends meet, Allport has converted part of its yard into housing for BP workers to stay afloat, but despite their efforts - they're still losing money. As a result of the moratorium, Dwayne has laid off some of his management staff and labor force and he doesn't expect them to stop layoffs until the moratorium is lifted. He's also enacted a 10 percent pay cut across the board for all of his employees. Dwayne fears he will ultimately have to close his doors as a direct impact of the moratorium. He has been in continued contact with the major client he lost and Dwayne says if the moratorium would cease to exist they would come back to Allport and operations would start up immediately."

On the issue of the latest suspension of deepwater drilling announced by Interior Secretary Ken Salazar, Governor Jindal noted that the first deepwater drilling moratorium the Administration issued was called 'arbitrary and capricious' and was overturned by a federal judge.

"This second suspension of deepwater drilling issued on July 12 is a clear sign that the Administration is unwilling to follow the advice of their own scientists and instead insists on crippling our energy industry, our coastal communities, and killing jobs," said the Governor. "They have already lost twice in court, but instead of listening to these legal rulings they are trying to game the system by initiating a second moratorium and then asking the court to abandon their move to block the first moratorium. The ultimate effect of this second moratorium is the same as the first - to shut down drilling operations in the Gulf. We must stand up and fight against this, just as we did the first time around.

"The folks in Washington just don't seem to understand that you can't just turn a switch on and off with these rigs. When they leave our coast to produce oil in other parts of the country or the world, the jobs that support them go too. Instead of an arbitrary moratorium, the Administration should listen to their own experts, and if they won't listen to their own experts, I want them to listen to all the voices of the people here with us today."

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