OIL&INDUSTRY
Maritime companies employ alternative means By Bridget Mire Staff Writer
Thoma Sea shipbuilders work on an offshore vessel in Thoma Sea’s Lockport facility. [ABBY TABOR/STAFF -- DAILYCOMET/HOUMATODAY]
Economists don’t see oil price rebound anytime soon By Dan Copp Staff Writer
Although low gas prices may be popular with consumers in other states, in south Louisiana the cheaper costs at the pump are a sign of troubling times. “They don’t like low gas prices in Louisiana,” said Loren Scott, a retired LSU economist and analyst of the state’s economy. “They really depend on those oil prices being strong.” The oil bust that started in mid-2014 has cost Terrebonne and Lafourche parishes a whopping 16,700 jobs, at a decline of 16.4 percent, Scott said. But the local forecast isn’t all doom and gloom, Scott said. “The good news is that if you look at the monthly data in the Houma metropolitan area, the job losses have been getting smaller,” Scott said. “In January you lost jobs at a
rate of 6,500 a year, but that number’s down to 2,800 a year in July. So, the good news is that the rate of decline is slowing. That’s really hopeful for your area. It’s not at zero yet, so we’ll see.” The number of rigs exploring for oil and gas in the Gulf of Mexico remains at its lowest level in a year, recent figures show. The Gulf rig count, a barometer for HoumaThibodaux’s oil-based economy, stood at 16, according to figures released recently by General Electric’s oilfield services company BakerHughes. It’s down two compared to the same time last year and the lowest since plunging to 10 late last September. The count is down 71 percent from the 56 rigs working in August 2014, when a three-year bust that has stripped thousands of jobs from Houma-Thibodaux’s offshore-oil-based
economy began. According to Gifford Briggs, vice president of the Louisiana Oil and Gas Association, the HoumaThibodaux area lost about 3,000 jobs since this time last year. “If you just look at the high point of our rig activity in 2013-2014, we had 2,200 rigs in the United States and we dropped all the way down to 350-370,” Briggs said. “Today we’re back up to 950, so at least that is a pretty significant increase.” Across the country, the rig count increased by one to 944, which is up 86 percent compared to the 508 drilling a year ago, according to BakerHughes. The increase was driven by a boom in inland shale fields where drilling is less expensive and quicker than the Gulf’s deep waters. According to the most recent total, 756 rigs sought oil and 187 natural gas. One was listed as
miscellaneous. The U.S. rig count peaked at 4,530 in 1981 and reached a low of 404 in May 2016. Jobs directly involved in oil and gas production increased by 100 in August but are down 500 since July 2016, according to a recent report from the Louisiana Workforce Commission. About 5,400 people now hold such jobs locally. It is the 30th straight month of over-theyear declines in oilfield jobs and a sign that a three-year bust is still extracting a toll on the metro area, comprising Terrebonne and Lafourche parishes. “There is not going to be an oil price rebound anytime soon,” said David Dismukes, executive director of the LSU Center for Energy Studies. “Prices are likely to stay very range-bound between $48 to $52 per See PRICES, C7
Although the threeyear oil bust has taken a toll on the maritime industry, local companies are striving to stay relevant through alternative means. Louisiana economist Loren Scott predicts by the end of the year, Houma-Thibodaux will have lost 16,700 jobs since 2015 – a 16.4 percent drop. Scott didn't have job loss figures for the maritime industry specifically, but he knows it's a "sizable" number. "At least one shipping company has told me they let about 1,000 of their mariners go," he said. "You take an outfit like Edison Chouest. One of the things Chouest did in order to hang onto the mariners is they changed up the work cycle. In the good old days, a mariner would work 28 days and then have 14 days off. Now, they're either seven days on and seven days off, or 28 days on and 28 days off. Basically, the amount of time they get to work has been cut in half. But by doing that, they're able to spread the work that is available around and try to hang onto the mariners as best they can." Scott said about 100 of Galliano-based Chouest's boats are tied up now, and they almost shut down its shipyard, LaShip. Chouest representatives couldn't be reached for comment. Many shipbuilding companies are staying open by looking outside of offshore work, Scott said. For instance, they may build ferry boats for New York or inland barges. Lockport-based Bollinger Shipyards is one company that has remained stable, Scott said. That's because Bollinger is in the midst of a $1.5 billion, 32-boat See MARITIME, C11
Officials look to diversify economy beyond oil industry By Dan Copp Staff Writer
As south Louisiana continues to reel from the devastating effects of the oil downturn, there are efforts underway to diversify the local economy to make the area less reliant on oil and gas. Just as a business shouldn’t rely on only one customer, local officials say they are working to ensure that the local economy isn’t depending on just one sector to stay afloat. The Terrebonne Economic Development Authority recently launched a five-year plan based on a $70,000 study that seeks to strengthen the parish’s economy by preventing it from becoming a onetrick pony solely reliant on oil. Matt Rookard, TEDA’s chief executive officer, said Terrebonne Parish has already made significant strides to do just that.
“I think if you look at it you’ll find there are a few areas where we’ve done pretty well in terms of diversification,” Rookard said. “If you look at sectors like health care and trucking, those are some good areas where you can see economic growth. A lot of that is tied to people being here due to the oil industry, but it’s also not completely reliant on the oil and gas sector.” Although Rookard said there is still much work to be done to liberate Terrebonne Parish’s economy from its dependence on oil and gas, steps were taken to diversify the local economy since the oil bust of the 1980s. “When I hear people say we haven’t done anything since the '80s to diversify the economy, I push back on that,” Rookard said. “Are we where we need to be? I’d say absolutely not. We have a lot of work to do. As good as the oil and gas business
has been we know there are boom-and-bust cycles. The economy needs to be robust and be able to deal with the ups and downs of the oil and gas sector.” Rookard said the major non-oil sectors experiencing the most growth are transportation and warehousing. “We’ve had some growth in manufacturing as well,” he said. “We’ve also had some growth in finance, real estate and insurance. Health care is really interesting because it’s one of things that came out of the oil bust in the 1980s and was really pushed in the 2000s by the leadership in this community.” Despite the need to diversify the economy, Rookard said TEDA doesn’t want to abandon oil and seafood to chase the prospect of new economic opportunities. “It’s a slow diversification process because See DIVERSIFY, C13
Kevin Pye talks about losing his job in the oilfield while sitting with his daughter Kira, 4. [ABBY TABOR/STAFF – DAILYCOMET/HOUMATODAY]
Oilfield workers cope with industry downturn By Holly Duchmann Staff Writer
Like many other men and women in Terrebonne and Lafourche parishes, Kevin Pye of Chacahoula was brought up in an oilfield family.“Throughout my
whole life, I was subconsciously trained to do a certain field of work,” Pye said. “Right in high school, I basically knew what I was going to do. I was going to go into the oilfield because there was a vast majority of money to be made and to
be able to live a lifestyle where you didn’t have to worry about much.” Following in his father’s footsteps, Pye entered the oil industry doing wire work immediately after graduating high See WORKERS, C9