The administration should adhere to the Jones Act and require that any oil released from the Strategic Petroleum Reserve be carried by American vessels, Rep. Rick Larsen, WA-02, said today. Larsen, the ranking member of the Subcommittee on Coast Guard and Maritime Transportation, today recommended an oversight hearing on the administration's plans to protect American jobs if the Strategic Petroleum Reserve is tapped.
"At a time when far too many Americans remain unemployed, we must make sure that any oil released from the Strategic Petroleum Reserve is carried on U.S. built, owned and crewed vessels," Larsen said. "The Jones Act's restriction that waterborne cargo between two points in the United States be carried on American vessels is a sensible requirement that protects American jobs and ensures that the United States maritime industries remain vibrant contributors to both our national security and our economy."
In June 2011, the United States released oil held in the Strategic Petroleum Reserve to combat rising prices of oil related to the conflict in Libya. The administration waived the Jones Act for the transportation of that oil.
"Last year's blanket waiver helped foreign tankers at the expense of American maritime workers," Larsen added. "We need to make sure that doesn't happen again."
Larsen sent a letter this week to Committee leadership with House Committee on Transportation and Infrastructure Ranking Member Nick Rahall detailing their request for a hearing. That letter is below:
The Honorable John L. Mica, Chairman, Committee on Transportation and Infrastructure
The Honorable Frank A. LoBiondo, Chairman, Subcommittee on Coast Guard and Maritime Transportation
2165 Rayburn House Office Building
Washington, DC 20515
Dear Chairman Mica and Chairman LoBiondo:
In the spring of 2011, civil unrest in Libya resulted in the removal of over 145 million barrels of oil from the world's petroleum supplies which led to a sharp increase in the price of oil. On June 23, 2011 in response to elevated oil prices and consistent with authority granted under section 161(d) of the Energy Policy and Conservation Act (42 U.S.C. 6241(d)), President Obama authorized Energy Secretary Steven Chu to draw down and sell petroleum held in the Strategic Petroleum Reserve (SPR).
Regrettably, the President also directed the Secretary of Homeland Security, Janet Napolitano, to waive the U.S. coast wise laws, more commonly referred to as the Jones Act, for the transportation of oil distributed from the SPR. As you know, the Jones Act requires that all waterborne cargo moved between two points in the U.S. be transported on American vessels. This unwarranted blanket waiver which allowed foreign tankers to transport crude oil within U.S. coastal waters drew a sharp, bipartisan rebuke from the Congress and from the maritime sector. Additionally, this action was directly responsible for the House adopting the Cummings-Landry amendment during Floor consideration of H.R. 2838, the Coast Guard and Maritime Transportation Act of 2011. This amendment would impose more stringent transparency and accountability requirements on the Maritime Administrator to justify the granting of any future waivers of the coast wise laws.
In light of the upheavals in gas prices, the Administration may again decide to release reserves from the SPR. Unlike last year, however, when the Administration justified its waiver of the Jones Act based on the unavailability of capacity in the U.S. tanker fleet, recent correspondence sent by the American Maritime Partnership to the Administration clearly articulates that there is "ample capacity to address changes in petroleum markets..."
Before the Administration makes any decisions concerning the SPR and/or subsequent waivers of the coast wise laws, we are requesting that you convene an oversight hearing on this matter at the earliest possible date before either the Full Committee or the Subcommittee on Coast Guard and Maritime Transportation. We believe it is vitally important to send a clear signal to the Administration that we fully expect any transport of oil released from the SPR -- now or in the future -- to be carried on U.S. built, owned, and crewed vessels. At a time when far too many Americans remain unemployed, we must give priority to addressing the needs of our own maritime workers.
Thank you, in advance, for your consideration of this request. We look forward to working with you to uphold the longstanding tenets of the Jones Act and to ensure that the maritime industries of the United States remain vibrant contributors to both our national security and economy.
Nick J. Rahall, II