American Oil and Gas Reporter - June 2017 - 17

CBP Withdraws Notice
To Change Jones Act

WASHINGTON-The U.S. Customs
and Border Protection Agency (CBP)
has withdrawn a proposal that the
American Petroleum Institute contends
would have imposed serious limitations
on the offshore oil and gas industry's
ability to operate safely, effectively and
economically.
The National Ocean Industries
Association explains that on Jan. 18,
CBP published a general notice to
revise almost 30 Jones Act interpretive
rulings going back to 1976.
NOIA cites a blog post by
international law firm Winston &
Strawn LLP that points out the Jones
Act restricts transportation of
merchandise between two points in the
United States, including U.S. territorial
waters, to U.S.-flag vessels. One
exception to that, Winston & Strawn
notes, is "vessel equipment" that has not
been considered "merchandise" as
defined in the Jones Act.
"Over time, CBP has issued numerous
rulings interpreting this definition,
including determining that vessel
equipment includes items 'essential to the
mission of the vessel,'" Winston &
Strawn details. "This became
controversial, culminating in a ruling in
2009 that determined, consistent with
prior rulings, that an (oil and gas) subsea
assembly was vessel equipment when
transported by a construction vessel that
had as its purpose the installation of such
equipment."
CBP's Jan. 18 notice would have
revised its interpretation of vessel
equipment, but "based on many
substantive comments," on May 10, the
agency announced it was withdrawing
the proposal.
"Withdrawing the proposed changes
protects U.S. energy security, and
allows for consumers and businesses to
continue benefitting from America's
energy renaissance," praises API
Upstream Director Erik Milito.
He cites a report released by API in
April that found the economic impacts
of CBP's January proposal included:
* The loss of 30,000 industry jobs
in 2017 and as many as 125,000 by
2030;
* A 23 percent decrease in U.S. oil
and gas production between 2017 and
2030;
* A decrease in offshore spending
of $5.4 billion a year; and
* The loss of $1.9 billion a year in
government revenue from 2017 to 2030,
and a cumulative loss of $91.5 billion in
gross domestic product. r

DOI Will Reconsider
Permit Applications For
Atlantic Seismic Surveys

WASHINGTON-The Department of
Interior began to implement President
Donald Trump's America First
Offshore Energy Strategy when it
announced on May 10 it would resume
evaluating applications from six
companies to conduct seismic surveys
in the Mid- and South-Atlantic Outer
Continental Shelf planning areas that
were denied late last year by the Obama
administration.
Five days later, the Interior Board of
Land Appeals, to which the companies
had appealed the Obama administration
denial, remanded their applications to
the Bureau of Ocean Energy
Management, according to a report
from the National Ocean Industries
Association.
"NOIA applauds Interior's decision,"
states President Randall Luthi. "As the
Trump administration moves forward in
developing a new five-year program for
offshore oil and gas exploration, new
surveys using modern technology are
vital to providing an up-to-date and
scientifically accurate picture of the
resources off our Atlantic Seaboard."
While the Atlantic Ocean was
removed from the 2017-22 OCS Oil and
Gas Leasing Program released last
November by the Obama
administration, DOI notes that President
Trump's executive order on offshore
energy, which was released in late April
(see story page 24), directs it to begin
developing a new program.
"Seismic surveying helps a variety of
federal and state partners better
understand our nation's offshore areas,
including locating hazards and siting
wind turbines, as well as offshore
energy development," comments
Interior Secretary Ryan Zinke.
"Allowing this scientific pursuit enables
us to safely identify and evaluate
resources that belong to the American
people."
DOI points out that the latest
geological and geophysical data for the
Mid- and South-Atlantic OCS were
gathered more than 30 years ago. r

Interior Department Picks
Angelle To Head BSEE
WASHINGTON- Department of
Interior Secretary Ryan Zinke has
tapped former Louisiana state official
Scott A. Angelle to head the Bureau of
Safety and Environmental Enforcement.

JUNE 2017 17
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American Oil and Gas Reporter - June 2017

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