Jones Act will not apply to drilling off US coast

Fuel Fix:
The Trump administration has withdrawn a controversial proposal that would have forced offshore oil and gas companies to give more work to American ships and crews when drilling in U.S. waters.

Announced in the final days of the Obama administration, the proposal would have done away with decades of exemptions by U.S. Customs and Border Protection that allowed international maritime crews to perform works historically reserved for Americans under a U.S. law titled the Jones Act.

But offshore oil and gas industry had warned that such a move would lead many companies to pull back from the Gulf of Mexico in favor of a offshore fields abroad.

“By rescinding the proposal, CBP has decided not to impose potentially serious limitations to the industry’s ability to safely, effectively, and economically operate,” Erik Milito, a director at the American Petroleum Institute said Wednesday.

The announcement by U.S. Customs dealt a blow to efforts by the U.S. maritime industry, which had spent $2 billion retrofitting ships and equipment in anticipation of getting an increased share of work in the Gulf’s offshore oil and gas fields, according to the Offshore Marine Service Association, a trade group representing U.S. vessel owners and operators.
The Jones Act has been a hindrance to US energy independence for some time.  Besides the impediments mentioned here, it also makes US produced oil in Texas less competitive with imported oil that can be shipped to the East Coast cheaper.  It makes US energy independence less likely.


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