Report forecasts uptick in Gulf oilfield
The Gulf of Mexico will see an increase in drilling this year for the first time since an oil bust began in mid-2014, a new forecast says.
“We expect 2019 to be a strong year for the Gulf of Mexico,” William Turner, senior research analyst at the global energy consulting firm Wood Mackenzie, said in a news release. “In addition to exciting new project sanctions, which could usher in more than $10 billion of investment into the region, a couple of historic firsts set to occur next year could set the stage for years to come.”
Whether that translates into new jobs for Houma-Thibodaux, and how many, remains uncertain. But the report from the prominent consulting firm is among the most optimistic since a global crude glut sent oil prices plunging, stripping more than 16,000 jobs from the area’s offshore-oil-based economy.
Shell and Chevron will lead the way, but the actual growth in exploration will come from new entrants, Wood Mckenzie says in its report, “US Gulf of Mexico: 5 things to look for in 2019.” They include companies such as Kosmos Energy, Equinor, Total, Murphy and Fieldwood.
Two major projects serve as bellwethers for the Gulf overall, according to the report, released in mid-December.
-- Chevron’s Anchor project, about 140 miles south of the Gulf oilfield service hub at Port Fourchon, is poised for a final investment decision this year. If approved, it would be the first project using new ultra-high-pressure technology to reach that stage, the result of more than two decades of industry research and development.
“Anchor will be an important one to watch,” Turner said. “The sanction of Anchor will be a significant milestone for Chevron, Total and Venari but also marks a crucial point for the offshore industry as it enters the final frontier in deepwater development.”
Success at Anchor will lead to the next wave of mega-investment in the Gulf, as several other projects using the same technology are waiting to follow its lead. Wood Mackenzie predicts that if Anchor moves forward, more than $10 billion of investment could flow into the region.
-- Shell’s Appomattox development, about 200 miles southeast of Port Fourchon, is set to begin producing oil and gas this year. It will be the Gulf’s first production from a Jurassic reservoir, high-quality oil in sediments that date back about 150 million years. It also required new technology to reach greater depths at higher pressures.
“If the Jurassic roars to life in 2019, it could give operators greater confidence in the play’s potential,” Turner said. “However, if Appomattox disappoints, the Jurassic could continue to lie dormant. The wider region would also be missing an expected strong production growth contributor.”
The report is one of several that predict an uptick this year in the Gulf oilfield. All hinge, in large part, on what happens to oil prices, which are notoriously volatile and difficult to predict, with analysts’ estimates varying widely.
Louisiana economist Loren Scott’s annual economic forecast, released in late September, projects the Houma-Thibodaux metro area, comprised of Terrebonne and Lafourche parishes, will gain 700 jobs, 0.8 percent, this year. It will add another 2,100 jobs, 2.4 percent, in 2020, driven largely by gains in oil and gas. Scott’s forecast is based on oil rising from an average of $65 a barrel in 2018 to $80 a barrel by 2020.
U.S. crude ended 2018 at about $45 a barrel, down 25 percent, the first annual loss since 2015. The trend was similar for Brent, which ended the year at $54 a barrel, down 20 percent. Both ended last week about $3 higher.
In its annual forecast, the LSU Center for Energy Studies predicts increased activity this year but says in the short term the Gulf rig count will remain around 20, where it has been for months.
The Gulf Coast Energy Outlook, released in November, tempers its forecast for offshore job growth by noting what other economists and analysts have said for years. Specifically, it says companies have cut costs through innovation and efficiency, including increased automation and the use of tiebacks that run pipelines from sub-sea wells to existing platforms rather than building new ones.
“This is great news in terms of making the Gulf of Mexico more competitive for future production by lowering costs per barrel of production,” the report says. “However, these productivity gains also mean that fewer workers are needed for a given level of production.”
-- Executive Editor Keith Magill can be reached at 857-2201 or keith.magill@houmatoday.com. Follow him on Twitter @CourierEditor.
Schools using test to indicate level of soft skills
HOUMA -- Are you struggling to hire entry-level employees who can show up on time and can be a trained?
The Terrebonne Parish School District is using a tool that can aid in reassuring you that the application of that high-school student or recent graduate you’re holding might be good fit for your company.
It’s the ACT WorkKeys National Career Readiness Certificate (NCRC) test, and it’s given to all students who are on Jump Start Career Pathway tracks, some upper level English students and is available to any student who scores a 21 or less on the ACT. Educators say that’s approximately 50 percent of the high-school population, and TPSD covers the cost for students.
Though WorkKeys testing students can earn certifications in Applied Math, Graphic Literacy and/or Workplace Documents on four levels – bronze, silver, gold and platinum. The credentials verify skills proficiency in
• problem solving
• critical thinking
• reading and using work-related text
• applying information from workplace documents and mathematical reasoning to solve problems
• locating, synthesizing and applying information presented graphically, and
• comparing, summarizing and analyzing information presented in multiple graphics.
For example, with a gold Applied Math certificate, students demonstrate their ability to solve problems using mathematical operations with mixed units, identify where a mistake occurred in calculations, calculate percentages and use it to determine a discount, markup or tax, convert between units of measurement, and other skills.
A gold Graphic Literacy certificate indicates students can locate information in a graphic using information found in another graphic, identify a trend/pattern/relationship and justify a decision based on information, among other skills.
Regarding Workplace Documents, a gold certificate indicates the ability to infer meanings of words or phrases from context, apply instructions to a new situation similar to the one described in a document while considering changing conditions and make inferences to accomplish a goal.
Why is this valuable to businesses? These areas indicate students’ strength in using mathematical reasoning and problem-solving techniques to solve work-related problems; graphs, charts, tables, floor plans and instrument gauges; and written text to do a job. The higher the score on the WorkKeys assessment (on a scale of 3 to 7), the greater the ability.
WorkKeys certificates are tools that can help employers better align their new hires’ skills with those needed for a job. That translates into a better-quality hire, shorter training times with greater knowledge retention, reduced turnover, increased performance ratings for skilled workers, improved employee morale and decreased operator error.
How do you know if an applicant has these certifications? Their school counselors have been recommending certifications be listed on resumes, added to job application forms and certificate copies offered to potential employers. Students have also been counseled to make their certificates publicly available so employers to verify them by entering a registration number online at http://www.act.org/content/act/en/products-and-services/workkeys-for-educators/ncrc.html
Want more information on WorkKeys certificates? Contact Katherine Gilbert-Theriot with Terrebonne Economic Development at 985-873-6890.
Houma shipbuilder lands two major contracts
A Houma shipbuilder has landed two new contracts as it works to rebound from a four-year offshore oil bust.
Gulf Island Fabrication will build a 245-guest riverboat for the American Steamboat Company, officials said Friday. The new paddle-wheeler, called the American Countess, will be built using the existing hull of the Kanesville Queen, a former gambling boat built in 1995. It’s expected to sail the Mississippi River starting sometime next year.
Gulf Island officials said they will report revenue and man-hours associated with the project in the company’s public financial statements for the quarter ending Sept. 30.
“We continue to break sales records and incredible demand remains for more capacity on the river with each of our boats continuing to sail full,” American Queen Steamboat Company Chairman John Waggoner said in a news release. “We look forward to collaborating with Gulf Island’s team of skilled workers and craftsmen to deliver a riverboat that will once again exceed expectations of our guests and continue raising the bar on domestic river cruising.”
The latest contract follows Gulf Island’s announcement late last month that it has finalized a deal to build a second 3300-horsepower towboat for an unnamed customer. Delivery of the second vessel is estimated two months after delivery of the first.
“We are pleased to be awarded this option for the second newbuild towboat,” Kirk Meche, Gulf Island president and CEO, said in a news release. “This work will be performed at our shipyard in Houma. ... This is yet another indication of confidence from our customers as it relates to our ability to perform and provide quality vessels.”
Gulf Island, based in Houston, is a leading fabricator of oilfield structures, including offshore platforms and ships. It also builds structures for the petrochemical and alternative energy industries. Its Houma fabrication and shipbuilding operations in Houma employ about 600 workers.
Like many oilfield service companies, Gulf Island’s business has been impacted by a four-year offshore oil bust that has stripped an estimated 16,000 jobs from the Houma-Thibodaux economy.
Meche cited some improvements in an Aug. 9 report on the company’s second-quarter financial results. The company reported net income of $500,000 on revenue of $54 million for the three months ended June 30. That compares to a net loss of $10.9 million on revenue of $45.9 million for the same period in 2017. And it’s up from the first quarter of this year, when the company posted a net loss of $5.3 million.
He cited strong performance from Gulf Island’s services division in Houma, as well as income from the sale of a fabrication yard in Ingleside, Texas, for part of the gain.
On June 6, the company landed a contract to build a second marine research vessel for Oregon State University for $67.6 million. And in March, it received a $63.6 million contract to build the first in a new class of Navy salvage, towing and rescue ships. Both projects are being built in Houma.
The company’s reported a backlog of work totaling $347.6 million as of Aug. 8, including projects through 2022.
“As of today,” Meche said in the report, “our backlog is the largest it has been in four years.”
-- Executive Editor Keith Magill can be reached at 857-2201 or keith.magill@houmatoday.com.
Houma Main Street Seeks Grant Applicants
The old City Court building in downtown Houma was renovated in 2011 with help from Louisiana Main Street grants.
Efforts to revitalize downtown Houma could continue this year with the opportunity for restoration grants from Louisiana Main Street.
Each year, the state program offers grants ranging from $2,500 to $10,000 for commercial building and business owners in historic downtown areas. Houma Main Street is once again offering its services to local businesses and property owners downtown who are interested in applying.
“Over the years, Houma Main Street has received nearly $80,000 in redevelopment grant funds from the Louisiana Main Street program, initiating $500,000 in local projects costs, plus associated jobs and economic stimulation,” Houma Main Street Manager Anne Picou said.
To be eligible, a building must be in the historic downtown Houma district and be at least 50 years old. The grants have a 50 percent match with the applicant, meaning that if a project is awarded a $5,000 grant, the business or property owner must also invest $5,000, Picou said.
Only one grant can be awarded for each Main Street district. Once applications are submitted to the Houma Main Street, the organization’s board will choose a project to submit to the state program.
In her 17 years with Houma Main Street, Picou said, the agency has helped secure grants for projects by Fakier Jewelers, the renovation of the former City Court building by Lori Davis, new signage at People’s Drug Store and the renovation of Rubicon Salon.
The grants are intended to preserve the historic character downtown, she said.
For example, if someone submits a project to change the facade of a historic property, that could undermine the outlook or integrity of the building. Instead, Main Street wants to work with business owners to keep the original integrity of the building, while modernizing it for new use, Picou said.
Even a simple sign project can promote economic development, she said.
“The Main Street program totally agrees with signage as a way to do economic development,” she said.
Having a large, attractive sign can draw in business and make a building recognizable.
Years ago, grants could be awarded for as much as $25,000, but budget cuts have reduced funding for the program, Picou said.
In the case of Rubicon Salon, when a tire store abandoned the building to move to a new location, the property left Main Street organizers wondering what to do.
“By grace of god, (Rubicon Salon) turned it into upscale salon,” Picou said. “It’s a genuine project, keeping the essence of historical building ... but still modernizing the inside elements.”
The old City Court building has a similar story. The parish was considering tearing it down and converting it into parking before Davis purchased the property and turn it into a commercial and residential property, Picou said.
“More and more people living downtown,” she said. “I try to explain that to people. Don’t give up.”
Several downtown businesses have already expressed interest in the program, which has become simpler over the years, Picou said.
The application deadline is 1 p.m. June 18. Applications can be obtained by calling Picou at 873-6408.
By Julia Arenstam, Staff Writer, can be reached at 448-7636 orjulia.arenstam@houmatoday.com. Follow her on Twitter at @gingerale214.
Louisiana ranked fifth-best road trip state
While tourism being one of the biggest industries in Louisiana is no surprise to anyone in the Bayou State, the state being named one of the top road trip state in the nation was a pleasant surprise for local tourism groups.
According to an annual report by wallethub.com, Louisiana is the fifth-best state for tourists to take road trips. The 50 states were ranked based on a number of factors divided into three overall categories: cost, safety and activities.
Houma ranks #442 in U.S. cities with the lowest average student debt balances
Houma ranked #442 in LendEDU’s newest report detailing the cities throughout the U.S. with the lowest average student debt balances.
The rankings for this report were developed by licensing Experian’s most recent financial data. More than 10,000 cities throughout the U.S. were analyzed for their average student debt balance. And, Houma ranked as having one of the lowest average student debt balances!
The full report and methodology can be found here:
https://lendedu.com/blog/u-s-cities-highest-lowest-student-debt-balances/
Houma Ranked #171 in LendEDU's Best Cities for Staying in Shape Report
Not only is staying in shape entirely up to you, but choosing what city to live in is also in your control. LendEDU’s Best Cities for Staying in Shape report will help you make the right decision by blending those two choices together.
SBDC Success Story - Martial Art Studio
Nathan Parfait, owner of Martial Art Studio, came to the SBDC to seek assistance with his loan package. Nathan worked with the SBDC to do the financial projections and loan packaging that resulted in capital formation of $145,135 ($130,135 Loan and $15,000 Owner Investment). Since Martial Arts Studio has received funding, they have expanded their program to an After School and Summer Camp program, and increased their sales by $96,000. The business has also added a program for when kids are out of school (School Year camps). Overall Martial Arts Studio has impacted the local economy by adding 1 Full Time and 6 Part Time employees. During the summer Martial Arts Studio employed 20 Part Time employees for the summer camp.
This year they are opening their 2nd location in Thibodaux. The company is looking to hire another Full Time and 4 Part Time Employees. Parfait says, "When this location gets moving and we have a solid growth like the Houma location, we will open a third location in either Raceland or Morgan City."
Martial Art Studio
130 Alliance Court, Houma
www.martialartstudio.net
985-772-1861