YOU NEED TO KNOW…
September 29, 2015
Lafourche projects likely on hold with mineral royalties down 35%
September 29, 2015
Visitors to our region fall in love with our bayous, the delicious seafood and, understandably, the people.
But maybe the most important element of southeast Louisiana largely goes unnoticed – our oil and gas industry
Surely the tens of thousands of local residents who put food on the table by fueling America don’t take the oil and gas industry for granted.
It’s no secret that one of the best ways to determine the success of an economy is to take a look at sales tax figures. When people have discretionary income, they spend more. When they don’t, retailers suffer.
In Terrebonne and Lafourche parishes, sales tax figures are beginning to feel the effects of dropping prices at the pump. Mineral royalties and expected sales taxes are down, too – a sharp change from recent years. As the glut of foreign oil and uncertainty of events in the Middle East continue to influence the price of oil per barrel, local oil and gas service providers are rethinking the way they do business. Operations are trimming office staff and, in worst cases, laying off oilfield workers.
The market’s uncertainty was a common theme in this year’s Oil & Gas overview (see section C of today’s paper). But the report is not completely grim. The oil and gas industry may be taking a hit, but the pipelines are still flowing. And that’s good news for our region.
Louisiana’s gateway to the Gulf, Port Fourchon, is estimated to have several million in investments for the 2015 calendar year. Early figures show the port will have similar financial investments in 2016 as well.
Investments are also booming offshore, where oil and gas experts say the Gulf of Mexico rig count at 40 is on its way to 50 and even 60 in the coming years.
Even for locals, it’s easy to live our day-to-day lives and forget exactly how much energy our industry provides to America.
The Louisiana Offshore Oil Port (LOOP), also in southern Lafourche Parish, moves more than 1.1 million barrels of oil per day, which can be shipped via pipeline to Pelican State refineries. And why stop there? The largest point of entry for water-borne crude oil coming into the U.S. can also send oil to 10 states, consisting of more than 50 percent of the nation’s refining capacity.
And there’s do doubt that an educated workforce is paramount. Especially when estimates show that a large portion of industry workers will be hitting retirement age within the next 10 years. That “Big Crew Change” is why industry has partnered with local institutions to ensure the future from a white-collar perspective.
Nicholls State University and Fletcher Technical Community College are readying tomorrow’s workforce today.
We’re proceeding with caution, but the industry is still providing jobs and oil. And that’s something to be excited about. Admittedly, we’ll all be relieved to see the prices at the pump rise – even if the rest of the nation doesn’t understand. Bottom line, the oil and gas industry may be down from previous years, but it is definitely now out. We’ll ride out the bumps in the readjust as we have before, and visitors to our region will continue to enjoy fishing our waters, eating our Cajun cuisine and visiting our people.
The oil industry may be down, but it’s not out.
