Offshore drilling debate affects Valley wallets

The Rio Grande Valley's potential future in offshore oil may hang on the national debate over where companies should be allowed to drill.

Local businesses and cities are maneuvering to capitalize on the expanding network of deep-water oil and gas drilling platforms along the Texas Gulf coast.

These platforms increasingly make use of local ports, industry and labor to support the difficult and dangerous work of pumping oil from the bottom of the sea.

But if the U.S. government lifts its ban on offshore drilling in the eastern Gulf of Mexico and along the Atlantic and Pacific coasts, the Valley could lose out on some of that business.

With too few offshore rigs available throughout the world, oil companies choose their upcoming projects based on the potential for payoff, said Bob Cornelison, director of Port Isabel's port, where many of the oil services companies moving into the Valley are based.

"When there's a lack of equipment, it gravitates to the hottest prospect," he said.

Although many "exciting" prospects in the Gulf are waiting on the equipment to drill, an even better opportunity could cut in line at any time.

That prospect could turn out to be off Florida - or Brazil.

New phenomenon

The more prospects in the running, the less chance there is that the Valley will reap economic rewards.

However, if there eventually are more platforms off the coasts of Texas and Tamaulipas they could generate a host of support services, said Brownsville Economic Development Corporation President Jason Hilts.

Brownsville is already home to Keppel AmFELS, a shipbuilding yard that constructs the multimillion-dollar offshore rigs that are so in demand. But while Keppel can and does ship its products across the globe, establishment of an oil-platform-related enterprise, such as a helicopter company, would rely on having rigs nearby.

A helicopter lift - transporting people from the rigs to shore - is one of the oil-related local business ideas the BEDC hopes will come to fruition.

Such enterprises may not create the kind of employment growth a major manufacturer would, but Hilts said adding a new industry to the region would help diversify the area's economy.

The movement of oil drilling projects to the lower Gulf coast "is a relatively new phenomenon, because the waters off the Valley get so deep so fast," Cornelison said. Until recently, it wasn't worth it to go for oil so deep, he said.

As a result, the south coast is short on infrastructure, particularly pipelines to carry oil from rigs to refineries.

However, he said, a Shell/Chevron project is under construction and should be drilling by 2010.

"After Shell comes online, there will be other opportunities out there, because Shell will have put in the pipeline."

Labor issues

The other difficulty facing the Rio Grande Valley's oil dreams is the same facing most of its industrial aspirations: A shallow pool of trained labor.

Welders, Hilts said, are in high demand but short supply for companies like Keppel AmFELS and Subsea 7, a spool piping company that recently set up shop in Port Isabel.

Area colleges have begun to develop specialized training for the new future, Cornelison said.

Offshore rigs need deep-sea divers, for example, as well as skilled construction personnel and engineers.

But the Valley does have one natural human resource: Unemployed shrimpers.

"The sons of shrimpers ... are now working offshore," Cornelison said. They are already trained to be captains and deckhands, but many have had to leave the region to find work supporting oil rigs.

"They'd love to be based here out of Port Isabel, instead of Louisiana," he said.

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Sara Perkins covers Mission, western Hidalgo County, Starr County and general assignments for The Monitor. You can reach her at (956) 683-4472.