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With the price of oil dropping more and more by the day, it’s undeniable that the domestic oil and gas industry is down.
Down, yes, but not out – especially at Port Fourchon where Executive Director Chett Chiasson said things are still slowly trudging forward.
Like anything else, work at Fourchon has slowed as oil prices have dipped to $30 a barrel at press-time. But Chiasson said the port isn’t yet in panic mode, touting that occupancy remains full and expansion plans are still in the works – even in the face of cloudy forecasts for the future.
“The port itself is doing pretty well,” Chiasson said. “Let me preface that. It’s doing about as well as can be expected. We expect a slow 2016, and that’s pretty much market-wide. But all of the long-term projections say that it will come back, and it will come back strong, so it’s just sort of a wait-and-see mode right now…. But we’re pushing forward and overcoming it as best we can.”
For Fourchon, forward thinking was the defining storyline of 2015, as Chiasson and the Greater Lafourche Port Commission decided in April of last year to lower rent to tenants – an effort to ease the burden on companies that were being hit by the oilfield pinch.
Chiasson has praised the port’s decision makers for the rent decrease, saying the swift action has been a huge asset for the port as it tries to endure the tough time.
The port’s executive director said that at press time, Fourchon hasn’t lost a single tenant – something that Chiasson said is a huge source of pride given the current climate. The rent shift was also a move that was praised by Louisiana Oil and Gas Association President Don Briggs, who said it helped companies in dire need.
“The industry is slower than folks had become accustomed to and companies were struggling to pay,” Briggs said. “That was the best thing for them to do – lowering the rent.”
Chiasson said with the rent decrease set to expire in April 2016, talks are already underway to extend it further to continue to lend a helping hand.
“We’re on top of it,” Chiasson said. “We’re already in discussions to see what we’ll do and where do we go from here. We’ve not lost a tenant, and I think lowering that rent had a lot to do with that. We want to keep it that way, so we all know that in the coming weeks and months, we have to evaluate that and figure out something that works for everyone.”
But through all of the industry challenges, Chiasson said the port has done its best to push forward.
The executive director said maintenance work has been nonstop to create greater access to workable property on the port – an ongoing battle as more and more land is developed.
Chiasson said in 2015, two massive bulkheads were completed in Slip C – the port’s newest slip.
“That was a big deal for us,” he said.
For 2016, Chiasson said that dredging will be done on the incomplete Slip D, which is currently under construction.
Chiasson said it was vital to continue to be cautiously aggressive in development, because when and if the oilfield battles back, the port wants to retain its position as the nation’s leader in oilfield drilling and support.
“We have to be aggressive,” Chiasson said. “We’ve taken pride all of these years in being able to meet the demands that are present in the industry. We don’t want to lose that. It may be slow now, but we have to stay ready. We have to do everything in our power to support the tenants and their needs.”
So now for the $1 million question – when is it all going to be back to business as normal in the oil and gas industry?
Chiasson said he tirelessly reads oilfield prognostications from all over the globe, and what’s troubling right now is how different everyone’s predictions are for the future.
“No one says the same thing,” he said. “That’s not what we’re used to seeing.”
But one common thread, Chiasson said, is that most of the experts pick the industry out of the gutter in the future and place the price for oil far closer to its $60-70 per barrel price.
Chiasson said he has no doubt that business will indeed get back to normal – someday. But he concedes that patience wears thin with every day that passes and the price of oil drops even further.
“It’s a tough time, and it’s hard to see,” Chiasson said. “But we’ve endured things like this before, and we have experience – unfortunately too much experience – dealing with these types of things. We’ll keep pushing. We’re going to do what we can to continue to improve ourselves and be active.
“This won’t last forever, and once it’s over, we’ll still be here.”
Briggs agreed, adding that a healthy Fourchon is good for everyone in the oil and gas industry.
“What’s done is invaluable there,” Briggs said. “Not just for you locally, but for the entire country.”
An overhead shot of Port Fourchon shows the non-stop work that is always going on within the southern Lafourche Parish hub. Even with the economic downturn, business is still churning, according to officials.
