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Ground zero for oil disaster suffers double whammy from moratorium

By Jessica Ravitz, CNN
  • Before disaster, Lafourche Parish had state's lowest unemployment rate
  • Port Fourchon services 90 percent of deepwater gulf oil activity
  • Effect of moratorium may ripple beyond Louisiana

Lafourche Parish, Louisiana (CNN) -- A liquored-up shrimper, with nothing else to do, lazes about on his docked weathered boat.

A salesman who supplies cleaning agents to oil rigs, primarily the deepwater kind, wonders how he'll get by on 10 percent of his income.

A woman hangs her head in her shutdown roadside bait shed, dreading this year's bills, not knowing how she and her husband will pay them.

These are just some of the faces of this southern Louisiana parish, which in many ways is ground zero for the extended oil disaster's fallout. Their pain is immediate, and most say the rest of the country will soon feel the hurt, too.

In April, before the Deepwater Horizon oil rig explosion changed everything, Lafourche Parish boasted the lowest unemployment rate in the state, 4.4 percent according to the Bureau of Labor Statistics -- ranking it among the best-off places in the nation.

And while the people who live here are as sickened as anyone by the oil gushing into the Gulf of Mexico and seeping into their bayous, they are equally upset by the moratorium placed on the oil rigs they serve.

"I keep trying to find the adjective to describe the impact on us," says Charlotte Randolph, the parish president. "I still haven't found the word."

The motto for this place tells at least part of the story. Lafourche Parish: "Feeding & fueling America." It's the kind of place where company pickups traveling to industrial sites cross estuaries carrying old fishing boats, where smokestacks spew on the other side of green and serene marshlands and where from rustic docks or sandy ridges one can spot oil rigs on the gulf's horizon.

I keep trying to find the adjective to describe the impact on us. I still haven't found the word.
--Charlotte Randolph, president of Lafourche Parish

Fishing is deeply rooted in this parish's history and remains a favorite pastime for those who grew up trawling and trapping with their grandfathers. Its ties to the shrimp, oyster and crab trade helped bring Louisiana the distinction of supplying anywhere from 25 to 30 percent of seafood to the lower 48 states, according to the Louisiana Seafood Promotion & Marketing Board.

"If you eat crab cakes in Maryland, odds are they're coming from our waters," Randolph says.

But those who fish have always struggled against the uncertainty of seasonal work. The competition of, for example, cheaper shrimp farmed in foreign lands has strapped them with more recent challenges. It is the parish's other lifeblood -- oil -- that changed life here, opened up opportunities, increased parish revenues and made futures seem more secure.

Nine out of 10 of the top taxpayers in the parish today, Randolph says, are in businesses related to oil and gas. About 8,500 people, in a population of less than 95,000, are expected to directly lose their jobs amid the rig suspensions, according to Chett Chiasson, executive director of the Greater Lafourche Port Commission.

Indirectly, he and others say, many more will suffer.

Chiasson oversees operations out of Port Fourchon, an expansive industrial port which is a base for 250 companies -- everything from the names we all know, like Shell, Chevron and BP to more obscure businesses offering mud equipment, drilling fluids and diving services. It's a lifeline to the gulf's oil industry, but on this day it's not business as usual. It's quiet, not the picture of bustling big business.

From this port, about 90 percent of all deepwater gulf oil activity or 18 percent of the nation's oil supply is serviced, Chiasson says, and all of the 33 suspended deepwater rigs are supported.

The deepwater rigs are the ones that require the most outside help. In other words, those fuel the most jobs.

There are 121 oil rigs in the Gulf of Mexico, but only 60 are currently working and that number will continue to drop, according to Tom Marsh, a vice president at ODS-Petrodata, a firm that provides intelligence and consulting to the offshore industry. A dozen deepwater rigs have already gone idle. The other 21 are working to safely shut down.

Thousands of production platforms -- what's put in place after a rig has drilled a well -- dot the gulf, but most of them don't need operating personnel on a continuing basis, Marsh explains. Fifty percent of Port Fourchon business, Chiasson expects, will fall away because of the moratorium.

Already, he says, Schlumberger -- an oilfields service provider -- has shut down its port operations, Exxon let go nine vessels that service the gulf's oil industry, and other company cuts are sure to follow.

Helicopter companies in Lafourche transport 15,000 workers each month to offshore oil sites, and Rodney Doucet, a parish councilman, says layoffs have begun. The 1,200 truckers who bring daily supplies to Port Fourchon are only paid if they're hauling, and they're only hauling if their supplies are needed. Mechanics who service vehicles, equipment renters, even a tattoo artist fears lost income.

"If they're not working, I'm not working," Bobby Pitre, 33, says outside his tattoo parlor in Larose, Louisiana. Nearby are murals he's painted and art he's created to voice his concerns. A life-sized model of an adult wearing a gas mask and a child -- and a fish -- dripping in oil bears a sign that reads, "God Help Us All."

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And it's not just workers in Lafourche Parish or even Louisiana who will feel the pinch, parish officials say. The wires used on rigs come from Texas, the gears from Ohio and the motors from Tennessee, they say.

A corporate office for a company producing drill bits in Houston, Texas, is abuzz with worry, says Doucet, who has a nephew working there. The councilman, who's bounced between commercial fishing and oil industry work over the years, now sells electrical supplies that support oil work. He's fretting about his own livelihood and those of his small staff.

He may "have to fire five people," he says. "One of them's my wife."

License plates from all over the country fill parking lots at helicopter launching sites, officials add, further illustrating how the local impact will reverberate outward.

For worldwide oil companies that have no loyalty to any one region, picking up their rigs and moving to drill elsewhere -- thereby increasing U.S. dependence on foreign oil -- is inevitable, they say. With contracts now void, they say these money-making companies aren't going to just sit around for six months. Chiasson confirms that already two of the 33 suspended rigs are on track to leave -- likely to Brazil or Nigeria -- and other companies, he says, will do the same.

Fewer domestic oil ventures in the gulf, they want people to realize, means less for Americans everywhere.

Each year, the U.S. Treasury rakes in $5 billion to $7 billion in royalties from Gulf of Mexico oil and gas, an amount the port executive says is second only to what the Internal Revenue Service brings in. CNN confirmed that those royalty figures are accurate and the statement about the IRS was, at least until 2004. But even if that's no longer the case, it's still a lot of government money, and Lafourche Parish officials warn that lost royalties may mean slashed funds to support, maintain or expand bridges, roads and schools across the country.

Another piece that really gets to Randolph is this: When 29 coal miners died in West Virginia, just weeks before the oil rig exploded and killed 11, it wasn't as if all mines doing similar work were issued a cease and desist order, she says. Immediate and thorough inspections of the rigs were warranted and most likely were conducted in haste by the companies that run them, she says. But a six-month freeze makes little sense to her.

"We don't want to defend wrong actions," she says, but she believes President Barack Obama "went too far," and she told him as much when she sat down with him one-on-one during one of his recent visits to the region.

She wants to know: "Are there Americans that are more important than other Americans?"

The need for alternative energy sources is something she can get behind.

"We understand. We're standing in pools of oil," she says, "But that transition will not come overnight."

On the other side of the toll bridge leading to Port Fourchon, the fishing enclave of Leeville struggles to make sense of its new reality. Tanned fishermen, still wearing their rubber boots even though they're not working, commiserate with thick Cajun accents and kick stones as they stroll down the deserted road. They seem outnumbered by out-of-town corporate consultant types -- many of whom wear logoed company shirts as they feast over large plates at Leeville Seafood Restaurant.

Owner Harris Cheramie, 65, talks about how he's hurting. With so many fishing areas closed, seafood prices are up. His customer base for the past 14 years, out-of-town commercial and recreational fishermen, has all but disappeared.

Over Memorial Day weekend last year, he says, he served up to 200 people in a night. This year, he served 46 -- almost all of them local residents. But he's not mad at the oil industry and doesn't want drilling to stop.

"Everything you have is made of oil -- fiberglass, carpets, plastic," he says. "I don't blame BP. Things happen."

It's the not knowing what will happen next that leaves him and others rattled.

For 33 years, Don Griffin and his brother have held tight to their Leeville business, Griffin's Marina & Ice. Between their small grocery store, restaurant, ice plant and fuel dock, they've continued to service commercial and recreational fishermen despite an onslaught of challenges.

They've cleaned up floods and bounced back from a long list of hurricanes -- Katrina, Rita and Ike to name a few. And they rebuilt after a fire ravaged their business in September 2008.

We're treading in waters that have never come before.
--Don Griffin, co-owner of Griffin's Marina & Ice

"You always come back. You know you have an end in sight," he says. "We're treading in waters that have never come before."

Nearby, his longest-standing employee looks on, the worry etched in her face. Three of her co-workers have already been let go, and Dodie-Dee Thomassie, who has worked for the Griffins for nearly 20 years and began as a high school student, wouldn't be surprised if her days are numbered, too.

The lines out the door at breakfast time aren't there anymore. The last time their restaurant sold anything to eat was days ago -- and that was four biscuits. At the grocery counter, she oversees a quiet store interrupted occasionally by someone who wants a soda, pack of gum or lottery ticket.

"We don't have people, so how are they going to keep me?" she says. "I'm not stupid."

About the only comfort she has right now is that her husband, a commercial shrimper, just got hired to help with the oil cleanup. With her house and her husband's boat paid off, she felt about as secure as any American could before the rig explosion rocked the world she knows.

Whether it's the simple pleasures of recreational fishing or the necessity of work to pay bills, people in this southern Louisiana parish are facing immediate losses. But to hear it from them, Americans who've never seen oil rigs while trawling bayous will soon have plenty to mourn themselves.

Just wait, they say. Just wait.

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