Bipartisan Bill Would Require a ‘Portion’ of American Oil and Gas Exports Be Transported on U.S.-Built Ships

energizing American shipbuilders act
U.S. Senator Roger Wicker, R-Miss., introduces the “Energizing American Shipbuilders Act”, May 22, 2018.

U.S. lawmakers introduced a bill Monday that would require a portion of exported crude oil and liquefied natural gas (LNG) be transported on U.S.-built and U.S.-flagged vessels, in addition to the construction of 50 new ships built domestically by 2040. 

The bill, known as the ‘Energizing American Shipbuilding Act’, was introduced in the Senate by U.S. Senator Roger Wicker (R-Miss), Chairman of the Senate Seapower Subcommittee and a member of the Subcommittee on Surface Transportation and Merchant Marine Infrastructure, Safety and Security, as well as in the House of Representatives by Congressman John Garamendi (D-Calif), the Ranking Member of the House Subcommittee on the Coast Guard and Maritime Transportation.

The lawmakers say the bill would support American shipbuilding by requiring a “small percentage” of liquefied natural gas (LNG) and crude oil exports to be transported on U.S.-built, U.S.-crewed vessels by 2040. It bill would further require the construction of over 50 new U.S. ships built by the same time, creating “thousands of mariner and manufacturing jobs across the country,” according to a press release issued by Congressman Garamendi.

“The domestic maritime industry supports hundreds of thousands of American jobs and is critical to our military readiness and national security,” said Senator Wicker. “This bill would strengthen our shipbuilding industry and would recognize the importance of having more American-flagged ships to transport our growing exports of oil and natural gas. China, India, and other nations are investing heavily in their shipbuilding capacity. The United States must keep up.”

The U.S. shale boom combined with the opening of the Expanded Panama Canal and Washington’s lifting of its 40-year ban on crude oil exports in 2015 has ushered in a new era of American energy exports which have the global oil and gas landscape. However, the vast majority of those exports are carried on foreign flag vessels rather than American ships. In fact, there are currently no LNG carriers registered under the U.S. flag.

“Rebuilding America’s shipbuilding and mariner base is an idea that unites Democrats, Republicans, metallurgical trades, the business community, labor, and our armed forces,” said Garamendi, “These industries are not only vital to our economy—they’re vital to our country’s national security. Congress has neglected our maritime industry for too long, to the point that we’re now several dozen merchant ships and 1,800 mariners short of what’s needed to guarantee sufficient sealift support in times of crisis. This bill seeks to turn the ship around by taking advantage of America’s energy export boom to bring back American shipbuilding, shipyard, and mariner jobs rather than continuing to outsource them to countries like China. I believe this bill is the start of a long-term reinvestment in the idea of America as a maritime, seafaring nation.”

Both Wicker and Garamendi are staunch supporters of the Jones Act, the law the requires cargo shipped between two American ports be transported on U.S.-built, -owned and -operated ships.

The Energizing American Shipbuilding Act was introduced on National Maritime Day, a presidentially proclaimed holiday recognizing the importance of the maritime industry and U.S. Merchant Marine.

The bill is supported by organizations including Shipbuilders Council of America (SCA); Offshore Marine Services Association (OMSA); Navy League; American Shipbuilding Suppliers Association; American Maritime Officers Service; American Maritime Officers; International Association of Machinists and Aerospace Workers; United Steelworkers; Marine Engineers Beneficial Association (MEBA); Alliance for American Manufacturing (AAM); Seafarers International Union; Masters Mates & Pilots; Transportation Trades Department AFL-CIO; Transportation Institute; Maritime Institute for Research and Development (MIRAID); Council of American Master Mariners (CAMM); Propeller Club of Northern California, according to Garamendi’s press release.