Alabama Shipbuilding Town Reels Under Drilling Moratorium

With foreign-farmed shrimp already a threat, the oil moratorium 'could kill our whole economy,' says local shipbuilder

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BAYOU LA BATRE, AL.—Workers move nimbly across the frames of two half-finished steel boats at Rodriguez Boat Builders on the muddy shores of Bayou Coden. Sparks fly as a welder works beneath one starboard propeller; thirty feet over his head, a newly finished captain’s quarters smells of sawdust and varnish.

But at this time last year, the company had 120 employees instead of 16, and the shipyard typically had at least three more boats under construction.

"We always had a backlog, more work than we could do at one time," owner Joseph Rodriguez says, gesturing at the two boats. "But now, this is it."

The economic recession had already put the brakes on business in the shipbuilding town of Bayou La Batre. But the Deepwater Horizon oil spill and the subsequent deepwater drilling moratorium have made the future look even more grim.

"Everybody is sitting around going, ‘What the hell is going to happen now,’" says Tara Marshall, vice president of Steiner Shipyard. "I think with the oil moratorium, it could kill our whole economy down here."

The six-month suspension by the Obama administration that put a halt on drilling 33 exploratory wells is almost universally unpopular among the coastal communities along the Gulf of Mexico. Radio advertisements call it "Obama’s job-killing drilling moratorium," and complaints surface everywhere from casual conversation to roadside signs.

This is perhaps an unsurprising reaction in a region where the economy revolves around only two main industries: oil and seafood, and many families work in both. The moratorium is particularly unpopular now that the seafood business is suffering from closures and bad publicity associated with the oil spill.

Flood of Foreign Shrimp    

Bayou La Batre’s evolution as a shipbuilding center has its roots in the fishing industry. Perched on the edge of the Gulf of Mexico, just west of Mobile Bay, the town held a prime location for fishermen. But a gradual shift from fishing to oil has been developing for the last decade.

"Up to eight or ten years ago the market was flooded with shrimp boats, and a lot of them were built down here," Marshall says. "But now the shrimp boat industry has gone down a lot. It’s almost a dying breed."

Much of the problem stems from a flood of imported seafood, according to Rodriguez — who comes from a local fishing family and is the former president of the Southern Shrimp Alliance, a non-profit alliance with members across eight states.

The shrimping industry was booming until changes in trade agreements offered foreign markets equal prices. This would be fine, Rodriguez says, if there were a level playing field — but there is not, because other nations are not subject to the same regulations as American fishermen.

While competing against an influx of pond-raised shrimp is part of the challenge that local fishermen face, so is the mandatory use of devices that reduce bycatch and exclude sea turtles. Rodriguez says he supports these precautions, but wishes that fishermen received some financial benefit for providing a smaller quantity of a more environmentally friendly product. Since that hasn’t happened, he says, the American shrimp industry has declined by 50 percent.

"The shrimpers who are here today are survivors," Rodriguez says, while sitting in an office where wood-paneled walls are covered with photos of boats he has built. He has a story for every one – fishing boats, tugboats and lift boats that can jack themselves up above the water on hydraulic legs to work alongside an offshore platform.

"Over the past 10 years my boat-building business has become 80 percent oil service and transportation, whereas it used to be 80 percent fishing business," he added.

‘Dominos Starting to Fall’

Now, the moratorium on exploratory drilling has thrown the local ship builders into uncertainty once again.

While only some of the shipyards focus on the large boats that directly service the deepwater drill rigs, all the boat builders are feeling the squeeze.

"The smaller stuff I’m building is indirectly affected with the trickle-down effect," Rodriguez says. "The dominos are already starting to fall all along the coast here."

Although the moratorium is only scheduled to last until November 30, and is currently being challenged by a lawsuit filed by Texas Attorney General Greg Abbott, it has created an atmosphere of uncertainty that in turn has led to less investment in resources such as new equipment.

Some fear that the moratorium will be extended because it plays into "Obama’s agenda of alternative energy," as Rodriguez says. He also fears that even when the moratorium ends, business will be slow to pick up. This is because drill rigs are privately owned and are leased to oil companies when they want to drill an exploratory well. The rigs move from job to job within the gulf.

Because of the lack of work in the Gulf, there is a chance that the rig owners might move somewhere else, like Mexico or Venezuela — and business could remain slow until they return.

"Right now were like a pack of dogs around a kill," Rodriguez says. "I’ve got people bidding against me on a job that never used to bid against me."


See also:

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