Oil and gas industry has Louisiana's best interests at heart: Chris John

08 01, 2013 by The Times-Picayune

The Louisiana oil and gas industry has been on what seems like a remarkable streak lately. Every day, industry reaches new frontiers in areas never thought imaginable because of technological advancements, and it seems like a new economic development project in the manufacturing sector is a regular headline in our state. This new and existing investment by industry accounted for more than 310,000 jobs and $16 billion in household earnings for Louisianans in 2009, and a nearly $78 billion impact in 2011. Imagine how these numbers will grow following construction of recently proposed projects and expansions. Unfortunately, there is something more ominous on the other side of the coin.

Louisiana has always been a litigious state with a reputation for being the place of big verdicts and huge plaintiff payouts. In fact, a recent study conducted by the U.S. Chamber of Commerce Institute for Legal Reform revealed Louisiana as the second worst legal environment in the country and found that by improving the state's legal environment, Louisiana may be able to save $1.1 billion in tort costs annually and increase employment rates by approximately 3 percent. So, while the oil and gas industry is generating growth and jobs in Louisiana, the plaintiff attorney "industry" is doing the opposite.

This campaign against Louisiana's oil and gas industry began with the legacy lawsuits, which has more to do with inflated court judgments than crafting a reasonable cleanup plan. The latest in this trend is a lawsuit filed that blames wetland erosion almost entirely on industry, despite its many causes both natural and manmade. Industry recognizes its role. However, our idea of a solution is very different than that of the Southeast Louisiana Flood Protection Authority - East.

For the past two decades, industry has implemented processes and dedicated resources to restoration and preservation efforts in addition to working with the state to secure funding for coastal protection efforts. We participated in the development of the state's Master Plan for Coastal Restoration and Flood Protection and continue to encourage Americans to support coastal restoration, as it is a national problem. Several Louisiana Mid-Continent Oil and Gas Association member companies have participated in the America's Wetlands Campaign, one example of how energy companies can positively impact coastal restoration and support energy security and deliverability.
Preservation of Louisiana's wetlands is also good business for our industry." -- Chris John of the Louisiana Mid-Continent Oil and Gas Association

Preservation of Louisiana's wetlands is also good business for our industry. The wetlands protect critical oil and gas infrastructure from storm surge. This infrastructure produces or transports nearly one-third of the nation's oil and gas supply and supports 18 percent of the nation's refining capacity. Coastal erosion threatens these assets and potentially the delivery of important energy resources to the rest of the country. Consider, for instance, information from Coastal.Louisiana.gov that says the replacement value for a major pipeline segment ranges from $500,000 to $1 million per mile, not to mention the lost income that results from delivery interruptions from either a temporary outage or complete loss.

Drilling technology and hydraulic fracturing are not the only advancements we've made in recent years. Environmental stewardship and sustainability are very important to our industry. The people of the oil and gas industry are the people of Louisiana--they live, work and raise their families on the coast. The industry invests in coastal restoration because it's our livelihood and it's our people's coast. It's our infrastructure, and our viability depends on it. We will continue to be a part of the solution, a solution that puts Louisiana first, working together with state leaders and the industry as a whole for a better, sustainable Louisiana coast, not sitting in a courtroom for the next several decades.
Chris John is president of the Louisiana Mid-Continent Oil and Gas Association.