AMFELS SHIP SUCCESS HINGES ON TRUMP'S JONES ACT EDICT

(Ed.'s Note: Keppel-Amfels at the Port of Brownsville recently announced that it was diversifying its operations to include shipbuilding. It hopes to cash in on servicing offshore drilling platforms and hopes that President Donald Trump repeals exceptions to the Jones Act and require that ships operating in U.S. waters use American-built ship and American crews. Will the "America First" president give in to pressure from oil and gas lobbyists and keep the exceptions in place? Or will he stay true to his word and come down on the side of Americans, as he said repeatedly on the campaign trail? His decision is scheduled to be announced May 18.)

Excerpts from Houston Chronicle

"For years, international ships and crews have traveled in and out of the Gulf of Mexico to construct the offshore platforms and deep-sea pipelines that allow oil and gas thousands of feet below the surface of the ocean to get to market.

But now a long-running fight between U.S. energy and maritime companies about what work international crews can do under U.S. law has come to a head, forcing a decision from the Trump administration. At issue is whether to require offshore oil and gas drillers to shift work handled by international construction crews to domestic ones, something oil lobbyists warn could decimate deep-sea drilling in the Gulf.

For President Donald Trump, who has promised to both grow the domestic energy industry and preserve American jobs for American workers, finding a path forward is fraught with political pitfalls. Whatever decision he makes, he is bound to end up alienating one of his key constituencies.

Under a century-old law known as the Jones Act, only U.S.-owned vessels are allowed to perform such work within American waters. But over the decades U.S. customs officials made a series of exemptions, 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 forward is fraught with political pitfalls. Whatever decision he makes, he is bound to end up alienating one of his key constituencies.

Then in 2009, former President Barack Obama ordered a review of those rules, setting off a panic in the offshore industry that gradually abated over the next eight years as no action was taken. Then, just days before leaving office, the Obama administration released a proposal that would repeal decades of U.S. Customs and Border Protection rulings that allowed the exemptions, forcing offshore oil companies to use U.S. ships and crews.

The White House did not respond to a request for comment, but a spokeswoman for U.S. Customs and Border Protection said the agency, which postponed a decision by two months to allow more time for public comment, is scheduled to rule by May 18.

In response, the U.S. oil and gas industry has undertaken a fierce lobbying campaign to block a repeal. The American Petroleum Institute recently released a study forecasting 30,000 job losses in this year alone, mostly in the Gulf region, and a 23 percent drop in U.S. oil and gas production by 2030.

Among the arguments used by U.S. maritime companies is that oil and gas drillers prefer international crews, which might be drawn from the less prosperous countries like the Philippines or Eastern Europe, because they are cheaper. Leatt, chief executive of the international maritime group, described that assertion as 'nice propaganda.'”