A Tempest in a Teapot:

It was inevitable. The coordinated response to the biggest environmental disaster of this generation has become bogged down in politics. Confusion reigns over the role of foreign registered tonnage in the cleanup of the ongoing BP U.S. Gulf oil spill. That said, anyone who understands the dynamics of today’s maritime industry, energy production and the regulatory climate that controls all of that shouldn’t be at all surprised. I am also disappointed.

It isn’t altogether clear – at least to me – that any of this wrangling is having a negative impact on the cleanup operation itself. On the other hand, the lack of a cohesive voice that speaks to the urgency of getting the job done through whatever means possible in the face of this disaster is, at best, disconcerting. At worst, it borders on reprehensible behavior from all involved. In the end, it amounts to nothing more than annoying background noise.

Veteran maritime attorney and retired U.S. Coast Guard Captain Dennis Bryant perhaps puts it best when he says, “I continue to be mystified regarding all the controversy about the oil spill response and the Jones Act. The Jones Act only applies to the transport of merchandise (cargo) from one port or place in the United States to another port or place in the United States.  Such transport by water must be done by a US vessel eligible to engage in the coastwise trade. Skimming spilled oil off the waters of the Gulf of Mexico outside of three nautical miles is not an activity that implicates the Jones Act, even if the recovered oil is offloaded in a US port.” Bryant ought to know: he has been actively involved with maritime and regulatory matters for more than forty years. 

Claims and Counter Claims

Sorting through the back-and-forth bickering now underway in the Gulf provides plenty of juicy material from which to craft a month’s worth of maritime opinion columns: U.S.-flag interests are preventing quality tonnage from entering the cleanup effort in the U.S. Gulf of Mexico. Foreign flag, registered owners are trying to “break” the Jones Act. Dozens of U.S. OSRV vessels sitting at the dock awaiting work! Senator John McCain’s new bill (S. 3525), dubbed ‘America’s Open Waters Act,’ threatens to end the Jones Act as we know it. Coast Guard waivers are necessary. Coast guard waivers are not necessary. Available foreign flag assets are available and are being ignored. And so on and so forth. If any of this leaves you scratching your head and wondering what to believe, then you are not alone.

MarPro turned to the federal authorities for clarification. According to the U.S. Department of Transportation, “It is essential to underscore that, despite allegations to the contrary, the Jones Act has not hindered the BP Deepwater Horizon oil spill cleanup effort.” A prepared statement from DOT goes on to claim that the U.S. Department of Transportation’s Maritime Administration, U.S. Coast Guard, and U.S. Customs and Border Protection are working to coordinate all offers of assistance – from domestic and international sources alike. Foreign-flag vessels have been participating, and will continue to participate, in the cleanup effort. Beyond this, DOT also claims, “If the Unified Command determines that specific assets are necessary but require a Jones Act waiver, we will do whatever is needed to ensure those assets are deployed. But to be absolutely clear, to date, the Jones Act has not prevented or delayed the mobilization of useful assets.” That position seems clear enough.

Facts and Figures

On Tuesday morning, the Joint Information Center for the spill response in Houston also provided MarPro with definitive advice on the physical assets now in play in the U.S. Gulf for the purpose of assisting in the spill cleanup. This is what they had to say (*):

• Jones Act Waivers Requested: 7
• Jones Act Waivers Denied: 0
• Pending Waiver Requests: None
• Total Foreign Flag (registered) Vessels in Service (5): ~25
• Vessels of Opportunity in Service (1): 2,718
• Skimmers in Service (2): 584
• Barges in Service (3): 504
• Other Vessels (4): 2,934

(*) See footnotes.

According to a local spokesperson in Houston, the numbers do not necessarily add up in a linear way. That’s because it wasn’t clear if some of the vessels of opportunity – private boats not necessarily built for oil spill response – were included in the totals represented by the bloc of skimmers being used. In any event, a total number of as many as 6,850 floating assets were reported as being used to combat the ongoing spill.  The best information available to MarPro on Wednesday morning was that no more than 25 of these vessels were of foreign registry.

The data provided by the Joint Information Center would appear to contradict the notion that insufficient U.S. based assets exist with which to combat the spill itself. With no pending “waiver” requests in play, it would also appear that the on-scene responders are indeed happy with the assets available, since no additional foreign vessels have applied for waivers. Those contemplating service offshore, in any event, would not require such approvals. A tempest in a teapot, indeed…

OMSA Weighs in: Ken Wells Refocuses the Conversation

The President of the U.S.-based Offshore Marine Services Association (OMSA) told MarPro on Tuesday, “It’s a confusing mess. This is no surprise.” Wells then went on to say, “Overall, the Coast Guard and BP have had a reasonable degree of sensitivity to the plight of the fishermen and offshore supply vessel operators that have the most to lose from the spill, as well as the exploration moratorium.” For his part, Wells says that OMSA – an organization that aims to “vigorously defend the cabotage laws of the United States” – has tried to provide the conduit between industry and BP during the crisis. “We’ve tried to define for them the available assets so that they can be properly and quickly employed. And this seems to be working to a certain extent.”

As the unofficial voice of the U.S.-flag offshore marine industry, Wells was curiously reluctant to criticize the Coast Guard or BP in their efforts to combat the spill and manage the assets available to get the job done. Instead, he focused his attention on an inaccurate portrayal of U.S. capabilities and the use of the crisis to revive anti-Jones Act activism.

OMSA’s  biggest concern with the ongoing response effort in the U.S. Gulf is what Ken Wells characterizes as certain parties seizing upon the “environmental” aspects of the situation as a way to break the back of the Jones Act. The addition of Senator John McCain’s bill to do just that was, in Wells’ estimation, an unwelcome addition to an already difficult situation. “Neither ploy has anything to do with the real issues,” he insists. And, while he takes at “face value” the government’s assertion that the foreign assets (that have so far been granted waivers or welcomed into the fight) genuinely possess specialized capabilities, there are, according to Well, relatively few foreign vessels that have anything in terms of technical advantages over the existing domestic fleet. He then points to dozens of U.S.-flag OSV’s already tied up alongside the pier because of the spill and drilling moratorium.

MarPro also reached out on Tuesday to the International Marine Contractor’s Association (IMCA), an entity representing the interests of foreign-registered tonnage in the U.S. Gulf. They declined to provide comment for the purposes of this article.  Likewise, efforts to elicit comment and clarifications from Allegiance Capital, a firm which is on record as trying to bring oil skimmers and vessels from Europe to the Gulf of Mexico to fight the spill, also proved fruitless. Allegiance Capital was the subject of a Texas newspaper’s recent investigative report that reported, among other things, that this firm had applied for Jones Act waivers on June 16. In contrast, the Joint Information Center in Houston told MarPro on Tuesday that no waivers had been denied and none were pending.

Grading the Response: Too much, too little or the wrong vessels?

With a clearer picture of who is doing the response work in the U.S. Gulf, and with what vessels, the focus correctly turns away from seemingly nonexistent Jones Act impediments and on to something much more important: how effective is the response? At best, the combined efforts of almost 7,000 vessels are uncertain. The hodgepodge flotilla of surface vessels acting as spill cleanup contractors includes more than 2,700 private “vessels of opportunity” and another group totaling almost 3,000 boats that the Joint Information Center identifies only as “other” vessels.” Together, the two groups make up about 85 percent of the spill response fleet. Almost certainly, the vast majority of these boats were not originally intended to combat oil spills, or “fit for purpose.”

While the amount of oily water mixture that has so far been collected can be measured and tracked, the percentage of that volume that represents hydrocarbon cannot. Critics assert that only a small percentage of the oil already spilled since April 20^th has actually been recovered and at this point, the Deepwater Horizon Command is unable to dispute those findings. On July 3^rd, the Unified Area Command announced that the skimmer fleet supporting the Deepwater Horizon Response Operations had doubled the volume of oil skimmed on the previous day near the well. That’s good news if a large percentage of that volume actually represents oil. As yet, no one really knows, however.

 With almost 600 skimmers now in place, the prospects for collecting a greater percentage of the oil being spilled should, in theory, increase. And yet, environmentalists doubt that more than 10 to 15 percent of the volume being collected actually represents oil. Still, the motley fleet probably represents the best bet for cleanup crews at this point and there is no evidence to suggest that that the collective skimming effort is not providing results equal to the amount of money being thrown at the problem.

Jones Act Arguments: the wrong issue at the wrong time, for the wrong reasons

As the Gulf spill drags on almost into its fourth month, there is no evidence to suggest that U.S. cabotage laws have had any impact on the cleanup effort. Where possible, specialized foreign assets have been brought in and waivers, where necessary, have been applied for and then granted. According to U.S. government sources, not one waiver has been denied. For most of the foreign vessels being used or considered, waivers aren’t even necessary. And, while the quality of that fleet and its collective ability to do the job at hand can be questioned, this has little or nothing to do with the registry of the assets in play. That’s a fact.

John McCain’s very public call to do away with the Jones Act through his proposed Senate bill (S. 3525), introduced on June 23 and referred to the Senate Commerce Committee, appears to be nothing short of a poorly thought-out publicity stunt. Locked in a difficult reelection battle in his home state of Arizona, this is apparently a good time to look “American” in a place where that persona carries a lot of weight. McCain has never been a proponent of the Jones Act, but his decision to push the agenda as the environmental crisis threatening the U.S. Gulf comes to a climax only serves to show the decidedly lukewarm support that the idea actually represents. In the meantime, the U.S. Congress, which took its Independence Day break shortly thereafter, is only now getting back in session. Dennis Bryant told MarPro on Tuesday, “I do not expect that the bill will ever get reported out of Committee.”

From time to time, the wisdom of the Jones Act and what it represents rears up and grips the domestic maritime industry here in the United States.  Almost one year ago, for example, a U.S. Customs and Border Protection (CBP) proposal to strengthen the Jones Act, prompted by U.S-flag interests, was aimed at ending “loopholes” in offshore work that allowed foreign-registered tonnage to perform certain work in the U.S. Gulf. The spat pitted the U.S.-based trade association OMSA against the International Marine Contractor’s Association (IMCA).

Jones Act disagreements always involve rulings over who can provide what services, on which vessels and in what waters. Usually, these rulings involve concrete issues such as regulations relating to repair expenditures made abroad for certain US vessels or perhaps, an effort to eliminate the Harbor Maintenance Tax (HMT) tax on the shortsea legs of the supply chain. In other words: valid discussions over substantive issues. Not so in the case of the Deepwater Horizon Spill Response.

This summer’s Jones Act discussions, misdirected onto the Gulf oil spill, only galvanized a loose coalition of Jones Act supporters into a more cohesive group. With the facts on the table and most folks now understanding that combating the spill should be the first priority, the noise created by special interests groups looking to capitalize on the mishap is being recognized exactly for what it is. There may be valid reasons to debate the merits of America’s cabotage laws. The largest (ongoing) environmental disaster in American history arguably shouldn’t be one of them.  Let’s keep our eyes and attention where they belong: on the oil soaked ball bobbing up and down in the U.S. Gulf. – MarPro.

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Joseph Keefe is the lead commentator of MaritimeProfessional.com. He can be reached at jkeefe@maritimeprofessional.com. MaritimeProfessional is the largest business networking site devoted to the marine industry. Each day thousands of industry professionals around the world log on to network, connect, and communicate.

Unified Command definitions:

(1) private, nondescript vessels of various types, not necessarily built for oil spill response but being used in that capacity.

(2) A number of these skimmer vessels may included in the “Vessel of Opportunity” category, with equipment placed aboard those vessels for that purpose.

(3) Used for both collection and/or ‘barrier’ purposes.

(4) No description for these vessels available. These craft probably the entire breadth of size, capacity, purpose and age categories.

(5)  Not all require “Jones Act Waivers.” Only 7 such waivers have been deemed necessary.