The US Customs and Border Protection (CBP) agency on Wednesday withdrew a proposal that would have tightened up the Jones Act to prevent exemptions that allow foreign vessels to supply equipment to offshore rigs, according to Reuters.
Advocates of the proposed changes had argued that they would benefit American workers – who they say have been undercut by cheaper foreign workers – and would bolster the nation’s security.
But opponents of the changes claimed they would cost American jobs because there were not enough domestic US vessels with the technical capacity to meet the needs for transporting the necessary equipment – items essential to pipeline, platform ad wellhead repair work.
The American Petroleum Institute (API) – a US national trade association for the oil and natural gas industry – estimated as many as 30,000 jobs could be lost through reduced activity in the Gulf of Mexico if the changes went ahead.
The Jones Act which dates to 1920, requires cargo transported between US ports to be delivered by vessels that are US-made, US-flagged and US-crewed.
But CBP waivers for foreign vessels involved in this particular aspect of the offshore energy industry have been in play for almost 40 years.
Originally the proposal to revoke the waivers had been made by the administration of former President Barack Obama.
The Offshore Marine Services Association (OMSA), a trade group for US vessel owners and operators, said the withdrawal of the planned changes was a blow to the US maritime industry, which has been investing $2bn retrofitting ships in anticipation of more work in the Gulf’s offshore fields.
CBP gave no detailed explanation of why it withdrew the proposal. This is the second time in eight years it has considered but ultimately dropped such a proposal.