Governor Jindal to White House: Don’t Double Down on Drilling Moratorium, Save Thousands of LA Jobs

June 25, 2010


HOUMA (June 24, 2010) – Today, Governor Bobby Jindal stood with hundreds of workers impacted by the Obama Administration’s deepwater drilling moratorium at Gulf Island Fabrication’s facility in Houma for the Economic Survival Rally. Calling the moratorium a second manmade disaster, Governor Jindal urged the White House to not double down on the drilling moratorium – which a federal judge has already ruled against – and instead to protect thousands of Louisiana jobs.

Governor Jindal said, “The last time I was here we announced that Gulf Island Fabrication was expanding their Houma facility and adding a fifth subsidiary, Gulf Island Marine Fabrication LLC. That expansion creates at least 200 new, permanent jobs, with an average annual salary of $53,000 per year, not including benefits, in addition to retaining 1,300 jobs here. Unfortunately, today we are here to talk about job losses – resulting from what a federal judge has already ruled is an ‘arbitrary and capricious’ six-month deepwater drilling moratorium that is estimated to kill 20,000 Louisiana jobs and cost us between $65 to 135 million in lost Louisiana wages each month.

“Thankfully, earlier this week we had a rare moment of common sense in this disaster from a federal judge who issued an injunction against the six-month deepwater drilling moratorium imposed by the federal government.

“You are going to hear from a lot of folks today on how this second disaster – caused by this moratorium – is impacting their lives. The federal judge who ruled to overturn the moratorium is not here today, so I want to share some of his words on what supported his decision.

“The words of this federal judge are especially important today because last night the Administration asked the court to continue their drilling moratorium and we know the Administration is also looking at implementing a second moratorium – just to make sure they have shut this drilling down. Here is some of what the federal judge said when he ruled to block the moratorium. He said, ‘The court is persuaded that it is only a matter of time before more business and jobs and livelihoods will be lost. The defendants trivialize such losses by characterizing them as merely a small percentage of the drilling rigs affected, but it does not follow that this will some how reduce the convincing harm suffered.’

“That is why we are here today. That is why this rally is called an Economic Survival Rally. We are in a fight for our survival against the oil spill disaster and that struggle has only been compounded by the second disaster of this ‘arbitrary’ and ‘capricious’ shut down of drilling off of our coast.

“Our message to the White House is simple – don’t double down on this six-month drilling moratorium that a federal judge has already ruled against.”

Governor Jindal cited the federal judge’s opinion in the case to highlight the Administration’s misguided approach in having a moratorium. The Governor said, “The federal judge said the Department of Interior’s report to shut down deepwater drilling was inaccurate and misleading. He said the Department’s statement that their report’s recommendations were ‘peer-reviewed by seven experts identified by the National Academy of Engineering’ was misleading and that five of the National Academy experts and three of the other experts have publicly stated that they ‘do not agree with the six month blanket moratorium.’

“The judge also said, ‘Of greater concern is the misleading Executive Summary that seems to assert that all the experts agree with the Secretary’s recommendation. The government’s hair-splitting explanation abuses reason, common sense, and the text at issue.’ The judge went on to say that the Minerals Management Service memo of May 28, 2010 ‘also fails to explain the reasons for the suspension of operations or the depth of operations to be affected.’

“I want to again quote you what the judge concluded. He said: ‘After reviewing the Secretary’s Report, the Moratorium Memorandum, and the Notice to Lessees, the Court is unable to divine or fathom a relationship between the findings and the immense scope of the moratorium. The Report, invoked by the Secretary, describes the offshore oil industry in the Gulf and offers many compelling recommendations to improve safety. But it offers no time line for implementation, though many of the proposed changes are represented to be implemented immediately. The Report patently lacks any analysis of the asserted fear of threat of irreparable injury or safety hazards posed by the thirty-three permitted rigs also reached in the moratorium. It is incident-specific and driven: Deepwater Horizon and BP only. None others.’”

The Governor added, “The judge says plainly that the Secretary’s determination that a six-month moratorium on issuance of new permits and drilling by existing rigs is necessary “does not seem to be fact-specific and refuses to take into measure the safety records of those others in the Gulf. There is no evidence presented indicating that the Secretary balanced the concern for environmental safety with the policy of making leases available for development. There is no suggestion that the Secretary considered any alternatives: for example the individualized suspension of activities on target rigs until they reached compliance with the new federal regulations said to be recommended for immediate implementation.”

In addition to the Governor, speakers at the rally included Gulf Island Fabrication Chairman & CEO Kerry Chauvin, ENSCO Offshore Co. VP/General Manager John Knowlton, Allport Services CEO Dwayne Rebstock, Rig Chem Owner Lori Davis, Offshore Towing, Inc. President Cory Kief, Shelia Rouse of K&S Trucking Company, NREC Mechanic Jamie Thibodaux, Captain Eric Hemmingway and Anthony Thibodeaux of Edison-Chouest, Parish President Michel Claudet, State Senator Norby Chabert and State Representative Gordon Dove.

Governor Jindal blasted the federal government’s inability to do their own jobs at the expense of tens of thousands of Louisiana jobs. He said, “The bottom line is this: Thousands of Louisianaians shouldn’t have to lose their jobs because the federal government can’t do their job”

“Not only does the moratorium threaten thousands of direct jobs in our state, it also jeopardizes many other industries that supply our oil and gas industry and the entire communities that depend on them. It is also deeply concerning that the Administration’s moratorium was enacted against the judgment of the Department of the Interior’s own expert advisors and scientists.

“The Administration already asked the court to continue their ban – and also enact a new moratorium. They 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.

“We absolutely do not want another spill or one more drop of oil on our coast or in our water, but thousands of Louisianians should not have to lose their jobs because the federal government can’t adequately do their job of ensuring drilling is done safely. The federal government has an entire agency dedicated to monitoring safe drilling. It shouldn’t take them six-months or longer for a new national commission to ensure safety measures are in place and their laws and regulations are being followed. Instead of an arbitrary moratorium, the Administration should listen to their own experts and enact the specific recommended steps from their own experts to ensure proper oversight and safe drilling.”

Governor Jindal railed against the new national commission set up by President Obama to study deepwater drilling saying the commission will not even have the first meeting until next month and they may not even finish their report until next year. The Governor also noted the need for a clear answer on how wage losses will be handled for the thousands of workers impacted by the oil spill.

Governor Jindal said, “The new national commission they are forming to study the moratorium for the President for six months now says they won’t have their first meeting until mid-July and they won’t finish their report until next year.

“Moreover, the $100 million set aside by BP to offset the wage losses of deepwater rig workers will cover only a few weeks of lost wages for those workers – and these funds will do nothing to offset the hundreds of millions in wage losses for workers in support industries that count on deepwater drilling activity for their livelihood. BP now tells us they will not pay for moratorium-related losses. The President said BP would pay. We know the President’s new point-man for the claims process will be here tomorrow and we hope he has some answers for our families.

Governor Jindal highlighted the potential total wage loss per month if the moratorium remains in effect and the Governor also called on the new national commission to hold each of their meetings in Louisiana so the members can have a first-hand look at how this industry impacts Louisiana.

Governor Jindal said, “I want to be very clear on this point: Each month that the work of the commission is delayed means another month that thousands of Louisiana people won’t be able to work. Each month that the work of the Commission is delayed, we expect additional energy companies to move existing deepwater rigs to other parts of the world and/or to plan new deepwater drilling capacity for other parts of the world in lieu of the Gulf – further extending and expanding job losses in Louisiana. Each month that the work of the commission is delayed will result in the loss of approximately $65-135 million in Louisiana wages.

“There is no reason this Commission should wait to have even their first meeting until next month and then take well into next year before they finish their work. In fact, today, we ask that this national commission hold all their meetings right here in Louisiana – and that they do so quickly. Not only will this help bring more economic investment to businesses along the coast that are suffering from the oil spill and now the drilling shut-down, but these Commission members should get a first-hand look at what our working coast looks like and how vital this industry is to our many coastal communities and our state.

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