Signs of USA further restricting foreigners working offshore

[James McLauchlan]

This one appears to be gaining some more exposure of late. Not hard to see where this is headed.

Friday, March 05, 2010

USA – OMSA: New Offshore Oil & Gas Areas
The Offshore Marine Service Association represents more than 250 member companies, including about 100 firms that own and operate marine service vessels.

OMSA released the following statement in reaction to the administration plan to unveil new offshore oil and gas areas:

As the association representing the owners and operators of the offshore supply vessels that support offshore exploration, development and production, we are looking forward to the Administration following through on the President’s stated desire to increase offshore energy production — be it from oil, gas or renewable sources.

However, if we as a country are going to expand offshore energy, we need to ensure that the work is done by Americans, especially when it comes to the vessels that make that expansion possible.

The Department of Homeland Security is currently reviewing the situations in which foreign vessels and foreign mariners are allowed to work in our offshore energy sector.

The issue involves the Jones Act, a law that requires cargo carried between U.S. points to be carried only on vessels that are owned by Americans, crewed by Americans and built in America.

If the Administration agrees to enforce the original intent of the law, expanding offshore energy will result in thousands of additional jobs from the maritime sector and reverse the decline in current jobs. If the Administration sides with opponents of the Jones Act, any new jobs created and an increasing number of current jobs will go to foreign workers and foreign-flag vessels.

It is worth noting that a recent economic study indicated that the U.S. flag offshore fleet is responsible for more than 100,000 jobs in this country and $18 billion in annual business sales activity. A correct decision on this issue would be a boon to American communities that rely on American vessel and shipyard activity for jobs and tax revenue.

[James McLauchlan]

Wow! No comment?

[Scott Beveridge]

I suppose we should comment on this…. Going the way the Aussie govt. did (tho’ there are some exceptions for expat employment). Re: protectionism.

The old biscuit, Homeland Security, of course had to be there.

BTW – the first east coast drilling will commence offshore Virginia, after years of opposition on the hill.

[Craig Thorngren]

James,

What’s there to comment about? I mean the Jones Act has been around since before most people on this forum even went to work on the water. The only new thing is wether this administration is going to follow the law or change it to soot their needs. One thing is for sure, it’ll go what ever way the Uni0n’s 😥 want it to…

Chief

[Mark DuPriest]

The US Congress would be hard pressed to pass a resolution against slavery at this time, I wouldn’t get my nickers in a bunch over this.
Unions have as much support as the shoe bomber.
In the GOM, Bin Laden.

[Craig Thorngren]

Uni0ns are why were in most this financial mess. From transportation, manufacturing to especially education, they are causing utter havoc. They have too much power (i.e. money) and litterally buy congressional votes. The worst part is that it is all perfectly legal.

As for the underwear bomber (aka "Fruit-da-Ka-Boom"), because of some screwed up politics he has more legal rights than most of the free world. He is now being afforded the full protection of the US Constitution…

No, the Jones Act is safe. You can call it protectionism or whatever you want, but every country in the world does it to help keep jobs and money in the respective country. Some just do it more efficiently…

Chief

[James McLauchlan]

….. but every country in the world does it to help keep jobs and money in the respective country. Some just do it more efficiently…

Chief

mmm…. I know this thread is about the USA but, by way of comparison, I can say that the UK hardly lifts a finger to keep jobs for itself. Over the years the UK steel industry, shipping, car manufacturing (to name but a few) have been run down or sold off to foreign owners. The UK unions have been unable to do anything about it and successive governments seem not to care. Gradually the country’s manufacturing base has been run down. Yet the Germans, French and Italians all seem to be still manufacturing cars, for example.

Plus, and more in line with our interests, the door is wide open in the UK sector of North Sea for anyone to work without a work permit.
Get a letter of invitation, fly over, jump on ship and head offshore. "Simples!" 😉

In one sense (unions aside) any country’s policy that favours giving jobs and contract awards first to those persons/companies from the country, and foreign entities second, has my vote.

I saw this thing on ‘favouring’ USA citizens/companies offshore in US energy industry waters flash up about a year back and it then went all quiet.. I feel that as the article I quoted was recent it made me think that the concept is being revisited with greater interest. In the longer term I do see the USA hardening up on letting foreign vessels and personnel into the likes of the GOM to operate when the work could be carried out by USA companies using USA employees. The tax gain for the USA is, of course, very obvious.

The Department of Homeland Security is currently reviewing the situations in which foreign vessels and foreign mariners are allowed to work in our offshore energy sector.

The issue involves the Jones Act, a law that requires cargo carried between U.S. points to be carried only on vessels that are owned by Americans, crewed by Americans and built in America.

The other things is, is good to get some more input from our members in the USA on how they see it going, as that may be taken onboard by our UK members whom I know have worked in the GOM on numerous occasions, me included, and probably expect to keep heading over that way.

More and more countries are tightening up on whom they let in to take potential work away from their own people. Evidence of that is all around us. Visa’s required ahead of travel to countries where you used to just front up, having to take more locals on teams etc.

[Craig Thorngren]

…Over the years the UK steel industry, shipping, car manufacturing (to name but a couple) have been run down or sold off to foreign owners. The UK unions have been unable to do anything about it…

And why have all of those UK industries been sold off or had the job "outsourced"? Plain and simple, the uni0ns became so powerful (and power hungry) that it wasn’t profitable to keep those industries in Country. It’s happened (ing) in the States. I can’t think of one job that a uni0n member does better and cheaper than a non-uni0n member just because they are in the uni0n…

Chief

[James McLauchlan]

…

And why have all of those UK industries been sold off or had the job "outsourced"? Plain and simple, the uni0ns became so powerful (and power hungry) that it wasn’t profitable to keep those industries in Country…

Chief

The Germans and French have managed on hang on quite nicely thanks. Nobody can try to convince me that either of those two countries don’t have strong unions. the outsourcing is not about unions having a stranglehold.

Those are land based industries. Now look offshore…
ROV doesn’t have union representation in the North Sea and yet some ROV jobs are already being outsourced and replaced by foreign labour at around 20-30% of the going rate.

[senior]

Hi,

Another job, but it requires you to be of a certain nationality WTF

http://twitter.com/amfalconer

it reads; amfalconer

1. is looking for an ROV Pilot for a permanent assignment in The Netherlands, must be Dutch national ideally with Seaeye experience. about 3 hours ago via LinkedIn .

????

Cheers Senior $$

"All for one and one for all"

[Anonymous]

In the longer term I do see the USA hardening up on letting foreign vessels and personnel into the likes of the GOM to operate when the work could be carried out by USA companies using USA employees. The tax gain for the USA is, of course, very obvious.

Its a global industry and vessels will continue to work worldwide. The idea that the States is going to build a new Solitaire, Saipem 7000, DeepBlue, Thialf, etc is complete nonsence of course. These will always be allowed to work. The GoM deepwater fields will never be developed without these vessels. The smaller construction vessels continue to work in the GoM with ease also. Its common practice to bring out jumpers, spool pieces and other Subsea construction hardware by cheap American owned and crewed barges and supply boats. Out to the expensive foreigned owned construction vessel. This simple work around the Jones act has been used constantly as it passes the transportation of goods section of the act.

As for the tax gain…Under the provisions of 135 domestic tax law, individuals will be subject to income tax on the income received for duties carried out in the US sector. Most folk are subject to American tax these days. Those that work for Subsea 7 in the GoM will have bitterly noted that.

[James McLauchlan]

The idea that the States is going to build a new Solitaire, Saipem 7000, DeepBlue, Thialf, etc is complete nonsence of course.

So we are supposed to acknowledge that the USA can build space ships but not ships that sail on the sea.
If the USA can put people into space and land stuff on Mars I’m sure they can build a DSV or two!

As for the tax gain…Under the provisions of 135 domestic tax law, individuals will be subject to income tax on the income received for duties carried out in the US sector. Most folk are subject to American tax these days. Those that work for Subsea 7 in the GoM will have bitterly noted that.

As some may be aware there is more to a country’s tax revenue than a few individuals working offshore. Plus… If they are not hardening up on foreigners working in the GOM how come most foreigners are subject to US tax these days when not too long back that wasn’t the case. I seem to remembers SS7 had problems getting Filipinos in to the states to work offshore last year… If that is not getting tougher on foreigners what is?

[Anonymous]

225 wrote:
The idea that the States is going to build a new Solitaire, Saipem 7000, DeepBlue, Thialf, etc is complete nonsence of course.

So we are supposed to acknowledge that the USA can build space ships but not ships that sail on the sea.
If the USA can put people into space and land stuff on Mars I’m sure they can build a DSV or two!

Missed the point somewhat, its not that they cant build these type of vessels, its just that they wont. They are hugely expensive and only a worldwide market is enough to keep them working full time. Intresting you mention space travel though. The USA can put men into space but not after this year of course. They will be entirely reliant on foreigners for that, in this case the Russians.

Hardening up on foreigners by making them pay USA tax??? In the context of protectionism, unions, and the Jones act, thats pretty weak. Only those lucky enough to pay no tax get upset by US tax, as US tax is often less than their home country.

[Mark DuPriest]

"US tax is often less than their home country"

US Federal Tax Brackets gerneric:
10% $0 – $8,375
15% $8,376 – $34,000
25% $34,001 – $82,400
28% $82,401 – $171,850
33% $171,851 – $373,650
35% $373,651+

After deductions and exemptions US$ 100k puts you in the 28% tax bracket, since that’s the highest rate applied to any of your income; but as a percentage of the whole $100,000, your tax is about 22.37%.
Lowest Fed. taxes of the industrialized world I believe.

http://en.wikipedia.org/wiki/Income_tax_in_the_United_States
http://www.moneychimp.com/features/tax_brackets.htm

[R2D2]

….and State Tax, County Tax and not least of all …… Medical Insurance along with eveyone else who wants their piece of your cake.
You’re left with crumbs on the floor 😉

[Author]

Posts