HOUMA, Louisiana: Although the three-year oil bust has taken a toll on the maritime industry here, 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 contract to build cutters for the US Coast Guard. Last year, the company received a contract for 26 more of the ships.
Bollinger representatives declined to be interviewed for this story.
Scott said the maritime industry needs the Gulf of Mexico oil rig count to increase.
“The Gulf has gone from 56 rigs down to around 20,” he said. “They got to around 17 at one point. There are more production platforms moving into the Gulf. There have been 12-14 new production platforms that have moved into the Gulf in the last few years. A production platform requires about a fifth of the number of supply boats that a drill ship does. What the marine side needs is the drilling part to come back in the Gulf.”
Scott doesn’t expect enough change in the next couple of years to convince companies that operate in the Gulf to make major investments.
“You’re talking about seven to 10 years of planning to drill and harvest,” he said. “They need to see oil prices well above $50 and be of the belief that it’s going to stay there or go higher,” he added.
Although Danos, based in Gray, doesn’t own or operate any vessels, it does have employees who work offshore, mostly on platforms.
Executive Vice President Paul Danos said activity has dropped since the downturn, but he doesn’t believe the company has been hit as hard as others. It peaked in 2014 with just over 2,000 employees and now has a little over 1,800 – a 10 percent reduction.
The company’s new corporate headquarters, unveiled in 2015, shows a long-term commitment to the area, Danos said.
But Danos said employees are at the heart of the company’s success.
“We have weathered the storm well because we have really good people who bought into the purpose of our company, the values of our company, and are helping us to come up with creative solutions to add value in the downturn that we’ve been in for a few years,” he said. because production has been robust and there’s been a need for additional capacity to move product via pipeline.”