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A time of waiting for CBP decision on the Jones Act

Posted on 28.09.2009 - 11:00 UTC in GENERAL NEWS by Rons_ROV_Links

A time of waiting for CBP decision on the Jones ActIt is a time of waiting for the offshore oil and gas industry as the US Customs and Border Protection (CBP) considers the comments they have received about proposed modification of rulings related to the Jones Act. The 30-day comment period closed on 17 August 2009 and if CBP renders a decision in accordance with its schedule, modifications could go into effect within 90 days. These proposals are set to change the long-standing precedents governing the use of non-coastwise qualified vessels operating in the offshore oil and gas industry.


The International Marine Contractors Association (IMCA), which represents offshore, marine and underwater engineering companies, submitted detailed comments along with a number of other industry associations, international bodies, non-governmental organizations (NGOs) and many individual companies. "These submissions sought clarification of the intent of the proposed rulings, explained some of the unintended consequences that might occur and requested enough time for dialogue for all parties to understand the impact of this announcement and carry out a proper economic impact assessment," explains Hugh Williams, Chief Executive of IMCA.

"It is hoped that from this avalanche of paper (believed to be over 550 pages in total and from over 120 different commenters) that CBP will grant an extension of time for further comment and that some clarity will emerge as all the interested parties take time to review it," he adds. All comments are now visible at www.cbp.gov/xp/cgov/admin/fl/foia/elec_read_room/jones_act/

"Bearing in mind how vital the oil and gas industry is to the U.S. economy, it is interesting to note that in parallel with this frenetic and totally unexpected 'Jones Act activity', the US Minerals Management Service, MMS, announced on 20 August that they had received bids valued at $115 million for leases (including deepwater leases) in the Western Gulf of Mexico. 189 bids were received from 26 companies on 162 tracts offered offshore Texas," Mr Williams remarks.

"Such leases are the pre-cursor to the oil companies spending millions and probably billions of dollars to explore and develop the potential oil and gas fields. With this sort of expenditure in the offing it is certainly not the time to have a lack of clarity from CBP about how these operations might be undertaken. We look forward to a speedy resolution of the current confusion so that the industry can move forward with certainty, generating optimism and enthusiasm to serve the USA's best interests."

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