New study finds Port Fourchon ‘vital’ to US economy
F. Jay Schempf
Port supported $63.4 billion in oil, gas services in 2006
F. Jay Schempf, Special Correspondent
An advance copy of a soon-to-be-published report on the economic impacts of a 21-day disruption of activity at Port Fourchon, Louisiana, on both the national and regional economies contains a number of findings judged by port officials to be ‘vital’ in their strategic importance.
The Greater Lafourche Port Commission, a nine-member board, exercises jurisdiction over the area of Lafourche Parish south of the Intercoastal Waterway, including Port Fourchon.
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Port Fourchon offshore service and supply activity to US Gulf offshore operations is heavy throughout the year. The effects of even a 21-day shutdown there could have serious impacts on local, state, and national economies.
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Port Fourchon is the equivalent of a small city that is vital to US energy supply needs and to the well being of the entire Lafourche region, identified as making up part of the Houma Metropolitan Statistical Area (MSA). The port directly engages in servicing about 90% of all deepwater offshore rigs and platforms in the US Gulf of Mexico, along with nearly half of all shallow-water rigs and platforms in the region. At the end of the day, Port Fourchon plays a significant role in meeting US energy needs, supplying 16-18% of the entire country’s oil supply.
In 2006, the US Gulf accounted for 470.7 MMbbl or roughly 80% of US offshore oil, the new study, entitled “The Economic Impacts of Port Fourchon on the National and Houma MSA Economies,” points out. It also notes that the Gulf accounted for 2.9 tcf of gas production, or 88% of total US gas production, in 2005, the most recent year in which statistics are available. According to the report, the port supported more than $63.4 billion of both oil and natural gas production in 2006.
Additionally, the port is the host for the Louisiana Offshore Oil Port (LOOP), an offshore imported crude oil offloading station and underground storage system capable of servicing supertankers. Since its inception in 1981 up to March 2007, the report states, the LOOP had unloaded more than 3.5 Bbbl of oil from more than 3,000 tankers. Figures compiled by the Greater Lafourche Port Commission indicate that the LOOP today handles roughly 15% of US crude oil imports and its pipeline system connects to over 50% of total US refining capacity.
The report observes that US imports of crude oil topped 5 Bbbl in 2006, with the LOOP handling an estimated 1.5 MMb/d or almost 420 MMbbl/year. “Using the 2006 price of $66.05/bbl for oil, this translates into $27.7 billion of imported oil flowing through Port Fourchon,” according to the report.
Fictional shutdown emphasizes economic importance
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Volume 68 Issue 3
March 2008
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