Tags: waives | jones | act | oil | east | coast

U.S. Waives Jones Act to Help Get Fuel to Northeast

Friday, 02 Nov 2012 12:57 PM


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The U.S. government issued a temporary blanket waiver on Friday of the Jones Act, which will allow foreign-flagged oil tankers from the Gulf of Mexico help supply the Northeast with fuel after Hurricane Sandy shut two New Jersey refineries.

The waiver from the Department of Homeland Security is effective immediately and runs through Nov. 13.

The Jones Act, created to support jobs in the maritime industry, requires that goods moved between U.S. ports be carried by ships built domestically and staffed by U.S. crews.

The American Maritime Partnership, or AMP, a domestic maritime industry group, said it was not aware of any circumstances where U.S. vessels have not been available to meet transportation needs for fuel. But it supports waivers in the aftermath of the superstorm that also wiped out power to many gasoline stations in the Northeast.

"We will not oppose waivers that are necessary to facilitate delivery of petroleum products into the regions affected by Hurricane Sandy," AMP said in a letter it sent to President Barack Obama and the heads of several government departments on Friday.

DHS said it had gotten only one request from a company to waive the law, but did not say which.

Energy experts were divided on whether the move would bring much relief to the fuel-strapped Northeast.

"There appears to be no urgent need at the moment," for a Jones Act waiver, said Bob McNally, head of Washington-based consulting firm the Rapidan Group. He said shortages have been at the retail level so far, rather than the maritime import level.

But David Goldwyn, who headed international energy affairs at the State Department until early 2011, said the waiver could boost the ability to deliver fuel to the East Coast now that tankers that were set to go to Europe or other destinations can dock there without restriction.

"The travel from Gulf Coast to the East Coast is pretty quick," said Goldwyn, who currently runs Goldwyn Global Strategies, an energy research and strategy company.

© 2014 Thomson/Reuters. All rights reserved.

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