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THE DEEPWATER DRILLING MORATORIUM: 

A SECOND ECONOMIC DISASTER FOR SMALL 

BUSINESSES? 

HEARING 

BEFORE THE

COMMITTEE ON SMALL BUSINESS AND 

ENTREPRENEURSHIP 

UNITED STATES SENATE 

ONE HUNDRED ELEVENTH CONGRESS 

SECOND SESSION 

JULY 27, 2010 

Printed for the Committee on Small Business and Entrepreneurship 

( 

Available via the World Wide Web: http://www.fdsys.gov 
(II) 

COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP 

ONE HUNDRED ELEVENTH CONGRESS 

MARY L. LANDRIEU, Louisiana, Chair 

OLYMPIA J. SNOWE, Maine, Ranking Member 

JOHN F. KERRY, Massachusetts 

CARL LEVIN, Michigan 

TOM HARKIN, Iowa 

JOSEPH I. LIEBERMAN, Connecticut 

MARIA CANTWELL, Washington 

EVAN BAYH, Indiana 

MARK L. PRYOR, Arkansas 

BENJAMIN L. CARDIN, Maryland 

JEANNE SHAHEEN, New Hampshire 

KAY HAGAN, North Carolina 

CHRISTOPHER S. BOND, Missouri 

DAVID VITTER, Louisiana 

JOHN THUNE, South Dakota 

MICHAEL B. ENZI, Wyoming 

JOHNNY ISAKSON, Georgia 

ROGER WICKER, Mississippi 

JAMES E. RISCH, Idaho 

DONALD R. CRAVINS, JR., Democratic Staff Director 

WALLACE K. HSUEH, Republican Staff Director 
(III) 

C O N T E N T S 

OPENING STATEMENTS

Page 

Landrieu, Hon. Mary L., Chair, and a U.S. Senator from Louisiana .................. 1 

Vitter, Hon. David, a U.S. Senator from Louisiana .............................................. 79 

WITNESSES

Panel 1 

Treese, Ethan, Vice President, Federal Government Solutions, Dunn and 

Bradstreet ............................................................................................................. 10 

Mason, Joseph R., Chair of Banking, E.J. Ourso School of Business, Louisiana 

State University ................................................................................................... 20 

Briggs, Don, President, Louisiana Oil and Gass Association ............................... 72 

Panel 2 

Randolph, Charlotte, President, Lafourche Parish (Louisiana) ........................... 88 

Bertucci, Leslie, Owner, R&D Enterprises ............................................................ 97 

Lillie, Troy, Former Refinery Employee, Exxon Moblie ....................................... 102 

Nastasi, Kimberly, Chief Executive Officer, Mississippi Gulf Coast Chamber 

of Commerce ......................................................................................................... 107 

ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED

Bertucci, Leslie 

Testimony .......................................................................................................... 97 

Prepared statement .......................................................................................... 99 

Briggs, Don 

Testimony .......................................................................................................... 72 

Prepared statement .......................................................................................... 74 

Gulf Citizens United 

Prepared statement .......................................................................................... 191 

Landrieu, Hon. Mary L. 

Testimony .......................................................................................................... 1 

Prepared statement .......................................................................................... 6 

Letter dated July 21, 2010, to Christina Romer ............................................ 121 

Letter dated July 26, 2010, to President Barack Obama .............................. 123 

Lillie, Troy 

Testimony .......................................................................................................... 102 

Prepared statement .......................................................................................... 104 

Mason, Joseph R. 

Testimony .......................................................................................................... 20 

Prepared statement .......................................................................................... 23 

Report titled ‘‘The Economic Cost of a Moratorium on Offshore Oil and 

Gas Exploration to the Gulf Region’’ ........................................................... 50 

Responses to questions submitted by Chair Landrieu .................................. 130 

Report titled ‘‘The Economic Contribution of Increased Offshore Oil Exploration and Production to Regional and National Economies’’ .............. 136 

Nastasi, Kimberly 

Testimony .......................................................................................................... 107 

Prepared statement .......................................................................................... 109 

Randolph, Charlotte 

Testimony .......................................................................................................... 88 

Prepared statement .......................................................................................... 91 
Page

IV 

—Continued 

Resolution from the National Association of Counties .................................. 126 

Responses to questions submitted by Chair Landrieu .................................. 134 

Shaheen, Hon. Jeanne 

Testimony .......................................................................................................... 5 

Prepared statement .......................................................................................... 6 

Snowe, Hon. Olympia J. 

Testimony .......................................................................................................... 3 

Treese, Ethan 

Testimony .......................................................................................................... 10 

Prepared statement .......................................................................................... 12 

Letter dated August 17, 2010, to Chair Landrieu ......................................... 168 

Vitter, Hon. David 

Testimony .......................................................................................................... 79 

Letter dated July 22, 2010, to President Barack Obama .............................. 80 
(1) 

THE DEEPWATER DRILLING MORATORIUM: 

A SECOND ECONOMIC DISASTER FOR SMALL 

BUSINESSES? 

TUESDAY, JULY 27, 2010 

UNITED STATES SENATE, 

COMMITTEE ON SMALL BUSINESS

AND ENTREPRENEURSHIP, 

Washington, DC. 

The Committee met, pursuant to notice, at 10:08 a.m., in Room 

SD–106, Dirksen Senate Office Building, Hon. Mary L. Landrieu 

(chair of the committee) presiding. 

Present: Senators Landrieu, Vitter, Thune, and Wicker. 

OPENING STATEMENT OF HON. MARY L. LANDRIEU, CHAIR, 

AND A U.S. SENATOR FROM LOUISIANA 

Chair LANDRIEU. Good morning. If the witnesses would take 

their seats, thank you so much. 

I appreciate everyone joining us for this very important hearing 

today. Ranking Member Snowe will be joining us in a few minutes, 

and when she gets here, I will recognize her for her opening statement. Then as members arrive, we will go into a line of questioning 

after our first panel and after our second panel, and each member 

will be allowed 5 minutes of questioning. We have about 2 hours 

set aside for this hearing, and I am very pleased to be able to call 

this hearing as Chair of this Committee. It is the first hearing conducted in Congress on the moratorium itself, which in the view of 

many of us that represent the Gulf Coast might be a greater economic disaster than the spill itself, which is what precipitated the 

calling of this meeting. 

Tomorrow will be the 100th day since 11 men perished on the 

Deepwater Horizon—and, Senator Vitter, as I said, when Senator 

Snowe comes, she will be able to give an opening statement, and 

then members will get 5 minutes of questioning for rounds. 

Tomorrow will be the 100th day since 11 men perished on the 

Deepwater Horizon drilling rig. First, the explosion that took the 

lives of those workers sent millions of barrels of oil spewing into 

the Gulf and onto our shores and into our marshes. Although this 

is not the subject of today’s hearing, determining an official calculation of the amount of oil will be extremely important to assess the 

billions of dollars of penalties that will be leveled on BP. 

Second, the uninformed and heavy hand of the Federal Government reacted to this tragedy by halting all drilling activity in the 

Gulf for more than 30 days and canceled the western Gulf leases, 
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which were scheduled to be leased or offered for bid in August. 

While some very limited shallow-water drilling has been allowed to 

move forward, all deepwater drilling has been brought to a complete standstill for an indefinite period of time. In fact, we checked 

this morning, and not one new shallow-water permit, I believe, has 

been issued since this action was taken, and it is not officially 

under a moratorium. 

This decision to halt all new energy production in the Gulf of 

Mexico appears to have been made in an uninformed manner and, 

in my view, borders on reckless. As a result, thousands of Gulf 

Coast businesses are confronting a second economic disaster that 

not only threatens jobs and businesses—those businesses include 

oil and gas fuel service organizations, transportation organizations, 

and machinery companies—but it also threatens a way of life just 

as surely as the BP oil slick does, and perhaps even more. 

The Administration’s decision to halt drilling activity did more 

than threaten the livelihood of thousands of rig workers and oil 

and gas service crews; it drastically reduced the amount of economic activity taking place in the Gulf Coast states of Louisiana, 

Texas, Mississippi, and Alabama. 

While we are here today to talk about the moratorium’s economic 

impact on small business and the economy in the region, we cannot 

ignore its consequences on our environment internationally and on 

national security. This Administration seems to be ignoring the fact 

that this action has actually increased environmental risk, and I 

will explain. 

The fact remains that America consumes 20 million barrels of oil 

a day. That is what our economy needs to function. So by stopping 

new drilling here at home, the U.S. will tragically increase exports 

from other countries who have less environmental standards, countries like Egypt, Nigeria, Angola, and Venezuela and have less 

pressure, I might say, to keep our oceans clean and beautiful. So 

this begs the question. By stopping drilling in the Gulf, are we 

helping the environment or harming it? I believe we are actually 

harming it. 

The impact of the moratorium on national security is even 

starker. Obviously, a barrel not produced here is a barrel of oil that 

is vulnerable to geopolitical decisions outside of U.S. control. Most 

of us in this room are old enough to remember the OPEC embargo. 

That is not something I think Americans would care to repeat. 

Increasing our dependence on foreign oil has direct ramifications 

on our national security. Consider this: When oil prices spiked in 

2008, Americans transferred nearly $700 billion overseas to pay 

our fuel bill during the price spike. About $400 billion went to 

OPEC countries. That transfer of U.S. dollars occurred in just one 

year, and that is when the Gulf was producing. We must get the 

Gulf of Mexico back producing for national security, for our environmental, and for small businesses, which is the subject of this 

hearing, along the Gulf. 

So today our hearing is intended to address the economic impacts 

of this moratorium on Gulf Coast small businesses. To be clear, my 

concern here is not for major oil companies like Shell or Exxon or 

BP. That will be the subject of many other hearings. We want to 

focus on the impacts of this moratorium to small business. If big 
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oil companies are prevented from producing here, they will simply 

transfer their capital to other countries, as I mentioned before. But 

the jobs that used to be based in America, many of them hired and 

employed by small businesses along the Gulf, will be devastated. 

I think it is noteworthy that the Administration was forced to revise its earlier ban this month after a Federal court decision ruled 

that its basis was not solid. As one of the first Senators calling for 

a full investigation into this accident and demanding more effective 

regulations, I share the Administration’s goal of a safer oil and gas 

industry, not their method to achieve that. 

Louisiana’s coastline is a working coast, bringing the country an 

abundance of seafood, energy, navigation assets, and much more 

through the mighty Mississippi River and the delta that it created. 

As residents of this working coast, no one wants drilling to be more 

safe than we do. No one wants the water to be more clean than 

we do. We have conducted these industries in balance for literally 

more than four decades, and we intend to continue that good balance into the future. 

But we also know that our ability to recover from this oil spill 

and any hope of a prosperous future depends on a robust plan to 

continue exploring and developing the abundant oil and gas reserves off of our coast. We know full well what prolonged suspension of deepwater drilling until November 30th, or longer, will 

mean for hundreds of oil service companies and other businesses. 

It will mean economic disaster. 

While the Administration has left open the possibility to resume 

drilling operations, it does not seem to be happening in the shallow 

water today, and there is no date certain for deepwater drilling in 

the future. For Louisiana alone, that puts some 330,000 people who 

earn a living in the oil and gas industry at risk. 

Our Federal Government has a responsibility, particularly in 

these difficult times, to make sure that their paychecks will not 

turn into pink slips. With our nation hopefully on the verge of an 

economic recovery, the last thing we need to do is to throw a 

wrench in the recovery that is underway on the Gulf Coast. 

I note for the record that on Wednesday, July 21st, I invited Dr. 

Christina Romer, Chair of the President’s Economic Advisers, to 

testify before this Committee to provide the Administration’s perspective and its own economic analysis in support of the moratorium. Unfortunately, the Administration was unwilling to provide 

a witness for today’s hearing. So yesterday I spoke to Dr. Romer 

personally, and she indicated the Administration does not currently 

have the economic impact data, which is very disappointing to 

learn. 

It is my understanding that such a review has been initiated, 

however, which is encouraging, and with that in mind, I sent a letter to President Obama yesterday announcing my intention to hold 

another hearing no later than September 16th where the Administration will submit their analysis and will provide testimony to this 

Committee regarding this moratorium. 

It is my sincere hope that this moratorium will be lifted by that 

time, but if not, I look forward and the people that I represent will 

look forward to that testimony. 
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Consider what we know today. Idling the deepwater rigs that 

were permitted to drill in the deepwater Gulf will immediately impact as many as 46,000 crewmen, deckhands, engineers, welders, 

ROV operators, caterers, helicopter pilots, and others who operate 

these service vessels. I have said in speech after speech, to try to 

paint this picture as clearly as I can to other Americans, it would 

be like laying off every firefighter and every police officer in Alabama, Mississippi, and Louisiana. 

Dun & Bradstreet researchers who will testify at today’s hearing 

have prepared a preliminary analysis that shows 2,828 Louisiana 

small businesses will be affected by this moratorium, and it will 

not be just businesses in coastal communities. In fact, Dun & Bradstreet found that nearly 700 of these businesses are located in central and north Louisiana, and that is just the impact to Louisiana. 

Neighboring states will also be impacted, particularly Texas. 

For example, the International Association of Drilling Contractors has found that 46,000 jobs are at immediate risk in 296 congressional districts. That is, 68 percent of all congressional districts 

will be negatively impacted by this near reckless decision. In addition, according to the Gulf Economic Survival Team, led by our 

Lieutenant Governor, Scott Angelle, long-term job losses in Louisiana could reach 120,000 by 2014. 

While Gulf waters may be clouded by oil in some places, the data 

against the moratorium is crystal clear. We cannot close down the 

offshore oil and gas sector without devastating economic impacts to 

our region. These are businesses like Laborde Marine, a familyowned business headquartered in New Orleans. In the late 1950s, 

Mr. Laborde pioneered innovations that would revolutionize the offshore service vessel industry. Today the company owns and operates 21 vessels, all built in U.S. shipyards, and employs more than 

300 people with a $14 million annual payroll. They invested over 

$150 million to build or acquire this fleet. The moratorium is essentially telling them to park their vessels for 6 months. For this company to move internationally, they would have to compete with vessels built in foreign shipyards at much lower cost and often subsidized by foreign governments. This is grossly unfair. 

This moratorium will also affect many small businesses that 

have indirect relationships to the offshore industry, as Young’s 

Grocery Store in Intracoastal City, Louisiana, can testify. Owner 

Scott Young says that his store has been supplying boats and production rigs with food for 12 years. Of the moratorium, Scott says, 

‘‘It will be a disaster I was not prepared for, one I cannot prepare 

for.’’ 

I would also note that it is not just Louisiana’s economy and jobs 

at stake. This oil service company employs people all along the 

Gulf Coast and throughout our nation. Consider Broadpoint, a 27- 

year-old company with 100 employees, based throughout the Gulf 

Coast, with their headquarters are in Houston. Their operations 

are 99 percent directly related to providing telecommunications 

services in the Gulf through satellites. Reliable communication is 

essential for the health and safety of individuals in the Gulf, but 

Broadpoint will be struggling to keep their employees on board if 

this moratorium lasts much longer. 
5 

Our hearing today is to learn more about how small businesses 

are being devastated by this moratorium. Our hearing today is to 

get testimony onto the record about the ill-conceived and heavyhanded action of the Federal Government. It does not meet our environmental needs; it does not meet our national security needs; 

and, it most certainly does not meet our economic needs. It fails 

every test. 

I believe this Congress needs to hear these stories of small businesses impacted throughout the nation that will be decimated if 

this moratorium continues. I am committed and the members of 

the Gulf Coast are committed to do everything we can to get this 

message out so that some relief can be put into place. 

If the Gulf Coast is going to recover from this nightmare, it will 

be because of the health and production of coastal Main Street 

small businesses that support the production of energy that fuels 

our nation. We cannot continue to support a policy that will put 

them out of business. 

[The prepared statement of Chair Landrieu follows:] 
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Chair LANDRIEU. I will recognize Senator Snowe when she arrives. Let us go to our witnesses, and I will allow you, Senator, to 

testify during your time, which the two of us will have plenty of 

time. 

Let us start with Mr. Treese until I can get a letter. Mr. Treese, 

go ahead. 

STATEMENT OF ETHAN TREESE, VICE PRESIDENT, FEDERAL 

GOVERNMENT SOLUTIONS, DUN & BRADSTREET 

Mr. TREESE. I would like to thank Madam Chair Landrieu, 

Ranking Member Snowe, and the Committee members for the opportunity to testify today. 

Dun & Bradstreet (D&B) has been the leading provider of business information and insight since 1841. We maintain a global 

database of over 169 million businesses, ranging from sole proprietors to the largest multinational corporations. Through our 

DUNSRight Quality Assurance Process, we collect information 

from more than 20,000 sources, including public record sources, 

third parties, and business owners themselves. We have more than 

23 million active U.S. businesses in our database and update our 

database about 2 million times a day to help ensure its accuracy, 

timeliness, and completeness. We serve as a trusted business partner for 95 percent of Fortune 1000 companies, all 15 Cabinet-level 

departments, most independent agencies, as well as state and local 

governments who use our information for business verification, risk 

assessment, and for custom analyses. 

D&B provides its customers with insights about businesses, including those that may be impacted by crises. For example, following Katrina, D&B helped both private and public sector customers assess the impact on businesses in the coastal areas in Louisiana, Mississippi, and Florida. In the 12 months after Katrina, we 

found that 15,670, or roughly 5 percent, of the 319,000 businesses 

we looked at in the impacted areas went out of business, resulting 

in the loss of roughly 89,000 jobs. 

Following the Deepwater Horizon oil spill, we conducted analyses 

on the potential business impact. We have since shared our findings with both public and private sector organizations, as well as 

Members of Congress. 

Our first analysis profiled businesses in the five Gulf Coast 

states by industry and number of employees to identify those industries most likely to be impacted by the oil spill. We determined 

the oil spill could potentially affect 7.3 million businesses. We further analyzed the top 50 industries and found that eating places, 

repair services, gift and novelty shops, hotel/motel, and gasoline 

service station industries had the highest numbers of businesses 

and employees that could be impacted. 

Our second analysis, which is our topic today, focused on the potential economic impact a drilling moratorium could have on small 

businesses located in the five Gulf states. We first identified industry classifications related to the oil and gas industries, concentrating particularly on oil and gas exploration services, field services and field machinery, as well as air transportation. We then 

looked specifically at those businesses that met the Small Business 
11 

Administration definition of a small business. Our high-level findings are as follows: 

There are at least 16,580 businesses in the five Gulf states that 

could be impacted by a moratorium in the industries I described. 

Approximately 98 percent of these businesses meet the definition 

of a small business, with 85 percent of these businesses having 

fewer than 10 employees. 

Six hundred sixty-seven of these small businesses are classified 

as woman-owned, minority-owned, or veteran-owned and 97 percent of these small businesses are U.S.-owned businesses. 

These small businesses employ 153,502 individuals, with over 95 

percent of them located in Texas and Louisiana, as shown on the 

chart. 

On average, these small businesses have been in operation for 16 

years, but we also found that roughly 2,000 of these businesses, or 

about 13 percent, were established within the last 5 years, which 

puts them at an even greater risk for failure since newer businesses tend to fail at a higher rate than more established ones. 

When we look at the potential impact of a drilling moratorium 

from a geographic perspective, we see that: 

The distribution of small businesses at the state level, as the 

chart shows, is as follows: 12,140 in Texas; of particular interest 

to you, Senators Landrieu and Vitter, there are 2,831 in Louisiana; 

579 in Florida; there are 487 in Mississippi; and 191 in Alabama. 

Only 27 percent of these small businesses, as you rightly point 

out, are located in coastal counties or parishes, while the other 73 

percent are located inland, suggesting that a moratorium could be 

felt more broadly throughout the Gulf states. Tuscaloosa County in 

Alabama, Miami-Dade County in Florida, Lafayette Parish in Louisiana, Jones County in Mississippi, and Harris County in Texas 

may be disproportionately affected. 

In Lafayette Parish alone, as you rightly point out, there are 780 

businesses employing close to 10,500 people that could be impacted. 

Now, while our analysis to date has focused on a finite number 

of industries within the five Gulf states, it is both prudent and reasonable to assume that there is an element of contagious risk 

which may extend beyond these industries. It is equally prudent to 

assume that this risk may extend beyond the five Gulf States and 

may impact small businesses throughout the country. 

In summary, D&B information and services are always available 

to the Committee, Congress, and others that can utilize this information to make policy decisions surrounding the drilling moratorium, the claims handling process, or other areas where sound decisions on policy can be achieved through the use of trusted information and analysis. 

I thank you for the opportunity to appear before the Committee, 

and I look forward to responding to any questions you may have. 

[The prepared statement of Mr. Treese follows:] 
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Chair LANDRIEU. Thank you very much, and I failed to introduce 

you properly, and I ask for your apology. 

I want you to understand that Mr. Treese oversees 60 government specialists assisting Federal, State, and local agencies with 

business verification, risk assessment, and custom analysis. We 

really appreciate your testimony today. I think you added a depth 

of insight that has been missing from the Congressional Record on 

this subject, and we look forward to continuing to call upon you all 

for objective and independent verification of the arguments that we 

are trying to make, and we thank you very much. 

Dr. Joseph Mason is Professor of Finance and Louisiana Bankers 

Association Endowed Chair of Banking at Louisiana State University. Dr. Mason is also a Senior Fellow at the Wharton School. He 

has consulted for and advised many Government agencies, research 

institutions, and corporations. I look forward to hearing your testimony. 

And we have Don Briggs at the request of Senator Vitter and 

myself, President of the Louisiana Oil & Gas Association. Mr. 

Briggs is a native of Miami, Florida, a 1964 graduate of Southwestern Louisiana. He began his career with Owen Drilling Company and has been with the industry for 45 years. Don will testify 

on behalf of the thousands of businesses that are part of his association. 

Mr. Mason. 

STATEMENT OF JOSEPH R. MASON, HERMANN MOYSE, JR./ 

LOUISIANA BANKERS ASSOCIATION PROFESSOR OF FINANCE, LOUISIANA STATE UNIVERSITY, AND SENIOR FELLOW, WHARTON SCHOOL 

Mr. MASON. Thank you, Ms. Landrieu, Ranking Member Snowe, 

members of the Committee, for inviting me to testify today on this 

timely and important topic. 

My study ‘‘The Economic Cost of a Moratorium on Offshore Oil 

and Gas Exploration to the Gulf Region’’ was released last week— 

and I would like to ask that it be included as part of my written 

testimony for the record here today. 

Chair LANDRIEU. Without objection. 

Mr. MASON. Thank you. It presents very conservative estimates 

of the economic loss caused just by the moratorium, assuming no 

expansion, assuming that it is lifted in November, and only affects 

the 33 deepwater projects. But even by my conservative estimates, 

the numbers are extremely large. Just the 6-month moratorium 

alone can reasonably be expected to result in the loss of approximately $2.1 billion in Gulf Region output, 8,000 jobs, and about 

$500 million in wages, and nearly $98 million in forfeited state tax 

revenues in the Gulf Region. 

The economic benefits to coastal and state communities from offshore drilling are substantial. Moreover, these offshore drilling activities revolve around small businesses, and many smaller oil companies will be crippled by this moratorium. The Wall Street Journal routinely reports that the oil industry in the Gulf of Mexico 

was largely developed by relatively small oil and gas companies. In 

the early 1990s, small players like Kerr-McGee, Ocean Energy, and 

Unocal were acquiring acreage in deep water, and their finds 
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helped prove the Gulf’s worth to bigger brethren like Chevron, 

Devon Energy Corp., and Anadarko, which later bought these successful companies at a premium. 

More recently, new generations of companies have started exploratory offshore businesses in the Gulf, and it is those new companies that are most at risk from the Administration’s policy. For example, Cobalt International Energy is already experiencing delays 

in its business because the ‘‘U.S. Government moratorium on drilling would delay the planned drilling of an exploratory well in the 

Gulf by at least those 6 months.’’ 

In response, President Obama has asserted that the Small Business Administration will be stepping in to help businesses by approving loans and allowing businesses to defer existing loan payments. The Administration seems to understand that businesses 

will be hurt, but what they do not understand is that some Gulf 

companies are already expressing worries that they have taken on 

heavy debts after Katrina and may not be able to repay those 

loans, much less take on additional loans. 

Of course, the simple solution would be to withdraw the moratorium. Unfortunately, that is not being discussed. Instead, the effects of the moratorium reverberate. Table 5 from my paper reports 

the total expected losses in employment from my study broken 

down into job types. Of course, a sizable proportion of those losses 

will occur in mining, about 26 percent. But a larger proportion of 

job losses, approximately 38 percent, are in high-skilled fields such 

as health care, real estate, and professional services, manufacturing, administration, finance, education, the arts, information, 

and management. The region can reasonably be expected to lose 

974 health care providers and 260 teachers. Nationwide, we will 

lose about 1,270 health care providers and another 321 teachers. 

While those employment and wage losses seem palatable on a 

national scale, it important to remember the effects of this are primarily local. Some communities’ job losses tied to the moratorium 

may mean the difference between having a local hospital or a local 

school or sending their children on a bus an hour and a half each 

direction to attend a school in a different area. 

As recently as March, the Administration was opening up the 

OCS planning areas that are on the map—that I had on the easel, 

but that is okay. Now they are talking about shutting those planning areas down. With each passing day, the moratorium costs the 

Gulf Region more jobs. But the Administration has apparently only 

begun to increase its hostility toward the sector. Some Members of 

Congress are now proposing changes to the Tax Code that would 

needlessly debilitate the oil and gas industry further, such proposals that really do not support economic recovery, jobs, or energy 

independence. 

But whether it is financial or environmental regulatory policy, 

regulators need to more effectively adapt to innovation and change. 

The escalating rhetoric that we see from this disaster, therefore, 

needs to be replaced with a clear direction for energy regulation. 

Regulators, regardless of sector, need not only clear responsibility, 

but clear unmitigated authority to act to investigate unfettered on 

the basis of their own suspicions. 
22 

The reason regulators require this kind of freedom is that they 

are often investigating new technologies—drilling or financial technologies—that, because they are new, cannot be deemed safe or 

risky beyond a substantial degree of error. Nonetheless, the error 

has to be biased in the direction of the social and economic good. 

That means we cannot just throw around moratoriums without economic analysis. 

Chair LANDRIEU. Can you take your 30 seconds to wrap up? 

Mr. MASON. Yes. That also means that we cannot just rely upon 

another application of the precautionary principle to address this 

crisis. 

Last, we have to accept that we are always going to have crises, 

and we have to develop strategies to deal with those crises. We 

need to be careful to set up incentives that reward those operating 

safe platforms in this instance and punish those who did not. That 

is, we need to be careful to preserve capitalism; we need to design 

policy more intelligently so that it is not obviated by markets but 

is instead magnified by market directions. 

Thank you. 

[The prepared statement of Mr. Mason follows:] 
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Chair LANDRIEU. Thank you, Dr. Mason. It occurs to me that the 

irony of all of this is that the only company drilling in the Gulf of 

Mexico today in deep water is the company that caused the spill— 

British Petroleum. 

Mr. Briggs. 

STATEMENT OF DON BRIGGS, PRESIDENT, LOUISIANA OIL & 

GAS ASSOCIATION 

Mr. BRIGGS. Chair Landrieu, Ranking Member Snowe, and members of the Committee, I am Don Briggs, and I represent the Louisiana Oil & Gas Association that has over 1,100 companies that 

operate and drill in the Gulf of Mexico and in Louisiana. Thank 

you for this opportunity. 

In Louisiana alone, the deepwater drilling moratorium now in 

place in the Gulf of Mexico stands to eliminate more than, very 

quickly 17,500 jobs in the next coming months. Overall, this detrimental policy will threaten the jobs of more than 200,000 hardworking Americans in Texas, Louisiana, Mississippi, and Alabama. 

In addition, this moratorium threatens the nearly $100 billion impact the offshore oil and gas industry contributes to the Gulf Coast 

states’ gross domestic product. 

For over a century, the State of Louisiana has served as an integral part of our nation’s energy infrastructure. Over 50 percent of 

the fuel, diesel and gasoline, that enters into this country runs 

through the intricate pipeline systems of Louisiana. And you can 

see by this chart, which is a telling story—I always call it the aorta 

of the U.S., our pipeline infrastructure. 

For decades oil and gas companies have explored and produced 

natural resources from the deep waters off our state. In total, oil 

and gas production in the Gulf of Mexico provides the U.S. with 

one-third of its oil and one-tenth of its natural gas. Nearly 80 percent of the oil produced and 45 percent of the natural gas is produced from the deep water. 

The Federal moratorium imposed on deepwater drilling in the 

Gulf of Mexico is creating a financial disaster for the Gulf Coast 

states and our nation. Nearly 3 months ago, there were 55 rigs operating in the Gulf of Mexico. There are 13 rigs operating today in 

the Gulf. 

In addition to the drastic decrease we are seeing in deep waters, 

this moratorium has created a stifling effect on all operations in 

the Gulf, including the shallow water, that were not supposed to 

be affected by this policy, as, Senator, you mentioned. In the past 

3 months of May, June, and July, a total of four permits have been 

granted. In comparison, 56 permits were granted in the 3 months 

of February, March, and April. 

When we end the day today, we will have consumed 20 million 

barrels of oil to run our nation’s economy. Today, we will consume 

65 billion cubic feet of natural gas. In addition, we will consume 

1,200 carloads of coal. On a daily basis, there are approximately 

250 million vehicles driving the roads in this country. Around 96 

percent of the fuel that runs those vehicles comes from oil. In the 

U.S., we produce 5 million barrels of oil. Of those 5 million barrels 

of oil production, 1.8 million come from operations in the Gulf of 

Mexico. 
73 

Prior to the imposition of the Federal drilling moratorium, nearly 

85 percent of the U.S. natural resources in the Outer Continental 

Shelf were off limits. Now, that number is 99.9 percent. If we look 

at other nations around the world, our country now has the largest 

prohibition to natural resource exploration in the world. In support 

of U.S. District Judge Martin Feldman’s recent decision to grant a 

preliminary injunction halting the moratorium, I too believe the 

moratorium is arbitrary and capricious. In my opinion, this detrimental policy does not reflect our American way of life. 

Industry has drilled over 4,500 deepwater wells around the world 

and 2,500 in the deep waters of the Gulf of Mexico. Yes, we do have 

the technology to drill safely. The Horizon incident should not have 

happened. Let us have an open discussion about the specifics of the 

Deepwater Horizon and find positive solutions to prevent any further disaster like this from happening. I believe industry can effectively work with the Administration to develop sound safety regulations and a long-term vision for America’s economic and energy future. We can accomplish safety measures while ensuring we do not 

endanger the economic welfare of all Americans. It is time that we 

get back to doing what we do best in Louisiana, and that is, fueling 

our nation. 

I thank you again for this opportunity to testify, and I stand 

ready to answer any questions you may have. Thank you. 

[The prepared statement of Mr. Briggs follows:] 
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Chair LANDRIEU. Thank you very much. 

I am going to recognize Senator Vitter at this time. I have received a letter from Senator Snowe designating him as her designee, so he will be allowed to make an opening statement, and 

then we will go into a line of questioning. We have been joined by 

Senator Thune, and we appreciate him joining us this morning as 

well. 

Senator Vitter. 

OPENING STATEMENT OF HON. DAVID VITTER, A U.S. 

SENATOR FROM LOUISIANA 

Senator VITTER. Thanks, Madam Chair. Thanks to all of you and 

the other panelists for being here. This is a very, very important 

topic. 

I am going to be very brief. I really want to underscore something the Chair noted. We appreciate your being here, but really 

the most important witness we should have before us is some significant representative of the Administration, of the President, that 

imposed this moratorium. Like Senator Landrieu, I invited the 

President to send any responsible witness to lay out the rationale 

for the moratorium, whether it be from the White House, the Interior Department, the Energy Department, NOAA, EPA, anywhere. 

Unfortunately, they were unable to produce a single witness, and 

I think that is very, very telling and really a shame. So I will submit for the record the letter I also sent requesting that witness. 

[The letter follows:] 
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Senator VITTER. I look forward to hearing from the Administration what we have not heard since the beginning of this moratorium and the beginning of this discussion, which is a clear economic rationale for the moratorium. Instead, what we have heard, 

whether it is from Secretary Salazar or Director Bromwich or the 

President himself, are excuses. The first excuse pointed to their 30- 

day commission, and then the Commission members immediately 

piped up and said, no, we did not recommend and we do not support this moratorium. Now the Administration is pointing to their 

Oil Spill Commission, the longer-term Commission. I talked to Bill 

Reilly, a co-chair, yesterday and he did not defend the moratorium 

in any way. And, in fact, he said he was very concerned about the 

economic impact of the moratorium, particularly based on the testimony they heard from many folks in Louisiana. 

So, again, I hope we can continue this discussion and hear directly from the President, from the Administration that imposed 

this moratorium, about what rationale, what grounds there are for 

it. 

Chair LANDRIEU. Thank you very much. 

Let us get right into our first round of questions. Let me begin 

with you, Mr. Treese. For the Committee record, was your report 

commissioned or funded by any outside group? 

Mr. TREESE. No, Senator. We conducted this analysis on our own, 

without being requested—without a request from anyone. 

Chair LANDRIEU. Okay. And, Dr. Mason, I understand that you 

are funded or have been before by the American Energy Alliance, 

which is a nonprofit advocacy group for the industry. Could you 

elaborate so that we can understand, people watching today, if your 

testimony was in any way influenced by that? Or do you want to 

comment on that situation? 

Mr. MASON. The study was financially sponsored by the American Energy Alliance. They played no part in directing any of the 

conclusions that were reached in the study or directing any of the 

analysis. 

Chair LANDRIEU. And both of you, where did you access some of 

your base information? Was it accessed through the portals of the 

Federal Government for your assessments? Starting with you, Mr. 

Treese. 

Mr. TREESE. We maintain a database of 169 million businesses. 

We used the information that we have. 

Chair LANDRIEU. Is this data available to the Federal Government? 

Mr. TREESE. Yes, ma’am. We work with Federal, State, and local 

agencies and provide this content in a variety of different ways 

based on their needs. 

Chair LANDRIEU. So if the Federal Government was interested in 

getting this data, they could access the same information that you 

received to make an analysis of this economic impact if they wanted to. 

Mr. TREESE. Yes, ma’am. 

Chair LANDRIEU. And, Dr. Mason, is the information that you are 

using available to the Federal Government? 

Mr. MASON. Purposefully, I ran essentially the study that the 

Federal Government would have run. I relied upon multipliers 
83 

from the Bureau of Economic Analysis that are published by them 

and sold by them. I followed methodologies that would routinely be 

followed by GAO and other Government research arms that 

would—— 

Chair LANDRIEU. And how long did that take you, basically, to 

conduct that kind of analysis? 

Mr. MASON. I believe it was 2 weeks. 

Chair LANDRIEU. Mr. Briggs, many Members of Congress, we believe, have a wrong view that this moratorium is affecting big oil, 

the big oil companies. Could you comment based on your representation of the independent companies along the Gulf really what you 

see are the effects of this moratorium relative to the smaller companies? That is really the focus of this hearing. 

Mr. BRIGGS. Yes, I would be glad to, and it is a common misconception that it is big oil in the deepwater Gulf of Mexico. In fact, 

70 percent of all the leases in the deepwater Gulf of Mexico are 

leases owned by independent oil and gas producers. The independents represent about 45 percent of the total activity in the deep 

water, and they represent 80 percent of the activities on the shelf, 

which is the shallow-water Gulf of Mexico. 

Chair LANDRIEU. Thank you. 

Mr. Treese—is it ‘‘Treese’’ or ‘‘Tracy’’? 

Mr. TREESE. ‘‘Treese.’’ Thank you. 

Chair LANDRIEU. ‘‘Treese.’’ I am sorry. 

Mr. TREESE. Quite all right. 

Chair LANDRIEU. Mr. Treese, another misconception—and this is 

going to help us to get this message out—is that there are only a 

few counties or parishes being directly affected by oil, either coming up on the marshes or washing onto the beaches. You know, you 

have seen the Pensacola view, the Venice view from Plaquemines 

Parish. We have seen shots of Port Fourchon and Lafourche. We 

have the President testifying, but your testimony was in stark contrast. You said it is not just the coastal counties and parishes that 

are going to be affected economically. You said many inland parishes are going to be affected as well. Could you elaborate on that 

data? Because I found that to be very, very interesting, not only 

the effects nationally but also inland in other counties and parishes 

in the Gulf Coast states that are not actually on the coast. 

Mr. TREESE. Yes, I would be happy to. I believe the point you are 

referring to is that when we looked specifically at the drilling moratorium data, we found that only about a quarter of the businesses 

or the small businesses we looked at are located in coastal counties 

or parishes. Three-quarters of them or roughly three-quarters of 

them are actually located inland, which speaks to your point that 

the moratorium will not just have economic impact on the coast 

alone but, rather, will reach farther inland. 

Bear in mind as well, for the purposes of the drilling moratorium 

analysis, we looked just at four or five industries. It is our belief, 

as we indicated prior, that there is a level of contagious risk that 

will extend out into many other industries, some of which you 

noted before. Whether they are catering services or uniform providers, it will indeed have an impact throughout the Gulf Coast 

and more broadly, we believe, in businesses, small businesses 
84 

throughout the country that are trading partners of companies in 

the Gulf Coast. 

Chair LANDRIEU. Thank you. 

Senator Vitter. 

Senator VITTER. Thank you all again for your testimony. 

Mr. Treese, can you broaden your discussion a little bit and talk 

about the impact of the moratorium on minority- and womenowned businesses? 

Mr. TREESE. Yes, sir, I would be happy to. In the analysis we did 

on just the five counties alone, as referenced in the record, we 

found that 667 of the small businesses are classified as womenowned, minority-owned, or veteran-owned. So we have not broken 

it down farther than that. However, if you so desire, certainly we 

can do some additional analysis and submit it to the Committee for 

the record. 

Senator VITTER. Okay, thank you. 

Mr. Treese and Dr. Mason, if you consider the spectrum of business from very large to very small, from a multinational major oil 

company to a Mom-and-Pop coastal shop, where will the impact of 

this moratorium be felt the most? 

Mr. TREESE. Based on our analysis, and given the fact that 

roughly, I believe, 85 to 90 percent of the businesses that we have 

analyzed are small businesses which employ thousands of people, 

by simple numbers alone there will be more small businesses impacted by this than larger businesses. And the numbers that we 

have for small businesses in these industries in the Gulf states 

mirror really what we see across the nation in that 90 percent of 

the companies that we have in our database, roughly 90 percent of 

the companies do indeed meet the definition of a small business as 

laid out by the Small Business Administration. 

Senator VITTER. Dr. Mason. 

Mr. MASON. The small businesses, too, operate with lower levels 

of reserves, are far less flexible than larger businesses. Larger 

businesses can move their operations elsewhere in the world. 

Smaller businesses are primarily local and stuck. They are the 

ones who will most likely fail, have to go through a bankruptcy 

process, and hopefully be able to re-emerge into a resuscitated 

economy, which is in doubt. 

Senator VITTER. Right. And, Mr. Briggs, one misperception up 

here I am very concerned about is that for this moratorium these 

rigs, these businesses are just going to sort of sit back and wait 

and then 6 months and a day will turn the light switch back on 

and go back into activity. I do not think that is the case at all. Can 

you describe what is beginning to happen in the industry in terms 

of moving assets and capability out of the Gulf? And how do you 

see that progressing over 6 months to a year? 

Mr. BRIGGS. Well, many of the companies are laying off people 

today. There is no way the smaller businesses that we have can 

withstand a 6-month moratorium. One of the big problems they are 

all faced with is that certainty or that trust that at the end of November this will be over. And that is something that, you know, 

when you think about it, they really are having difficulty doing. So 

they are laying a lot of people off. 
85 

Companies like Schlumberger, some of the larger firms, they are 

deploying their people to different parts of the world, and you will 

probably hear testimony to some of that. But many of the companies, the small ones throughout the Gulf Coast, some of them have 

given their people vacation time, temporarily laid off. But the jobs 

are going down, literally thousands of them as we speak, and that 

will be happening in the next several months. And, yes, there are 

three rigs that are already gone. Each one of those rigs, you know, 

employ about—direct and indirect, about 1,400 to 1,500 people, according to two different studies. So you are talking about, of the 

33 rigs, 50,000 jobs. And a lot of those—— 

Senator VITTER. Direct. 

Mr. BRIGGS. Direct. Direct jobs. You have got 250 for each rig, 

and then you have got about an eight-person-per-rig individual ancillary type jobs—your boat captains, your metal tool companies, 

your mud companies. And a lot of these companies are on hold. A 

lot of them are fortunate that they have had a good year. You 

know, business started getting back so they are holding onto people. They do not want to turn loose their people because it takes 

so much to train them. But many of them are having—we cannot 

really quantify today at this very moment exactly how many people 

have been laid off, but many have. 

Senator VITTER. Right. And, Mr. Briggs, you mention in your testimony a startling figure, if you could repeat it, the percentage of 

our area in the United States that we have now moved off the table 

in terms of natural resource production. What is that again? And 

how does that compare to any other industrialized or resource-rich 

nations in the world? 

Mr. BRIGGS. We are the only nation in the world that, prior to 

this moratorium, had 85 percent of natural resources on the coastal 

areas off limits for exploration. We are off limits on the east coast, 

the west coast, Alaska now, and the only place we were really 

about to drill and explore in the OCS was in the central and western regions of the Gulf of Mexico. We are talking about the eastern 

Gulf, but now that that is shut down and we know we have moratorium—and there is not a moratorium on the shelf, and I understand that. But, Senator Landrieu, as you well said, the permits 

coming out of there, as you saw, are just—you know, our companies 

are not able to get permits today. And the independents are the 

ones—the small businesses are 80 percent of that shelf activity. 

Senator VITTER. So that 85-percent figure pre-moratorium is now 

about what? 

Mr. BRIGGS. Well, if you calculate it, probably 99.9 percent. I 

mean, for all practical purposes, we feel in the Gulf of Mexico that 

we are shut out. 

Senator VITTER. Thank you. 

Chair LANDRIEU. Senator Thune. 

Senator THUNE. Thank you, Madam Chair, and I want to thank 

you and the Ranking Member for holding today’s hearing on a topic 

that I think has been largely overlooked in the reaction to the Gulf 

oil spill, and that is the economic damages that are caused by the 

Administration’s offshore moratorium on oil and gas exploration. 

Congress and the Administration should be focused on permanently fixing the leak, on cleaning up the gulf, and restoring the 
86 

gulf coast economy. Unfortunately, I think some of the actions that 

have been taken by the Administration proposed by some Members 

of Congress would actually have a damaging impact on the Gulf 

Coast economy, which is already devastated by the effects of the oil 

spill. And I appreciate the testimony that you have offered this 

morning that I think illustrates the impact on the way of life for 

thousands of families that depend on good-paying jobs related to 

the oil and gas industry along the Gulf Coast. You have already 

referenced the idle oil rigs that are being moved to other areas of 

the globe while workers wonder if their jobs are ever going to come 

back. We still have Members of Congress calling for a total repeal 

of liability limits for offshore energy production. While we all know 

that a major international oil company was responsible for this 

spill, such proposals also punish smaller independently owned oil 

and gas companies and leave the United States even more dependent upon foreign national oil companies to produce our oil and gas 

resources. So I see this as just a major issue that impacts, of 

course, directly people in the Gulf, but also has profound implications for energy in this country and the dangerous dependence that 

we already have on foreign supplies of energy. 

Mr. Briggs, could you tell me just how the moratorium is affecting not only the deepwater but also the shallow-water rigs, those 

that are in 500 feet of water? Is that still going on or is that—— 

Mr. BRIGGS. Yes, that is correct. What happened, you know, 

when the President and MMS or BOM or whatever it is called now, 

they immediately put in some new regulations to tighten up the 

safety operations in the Gulf of Mexico. So all those new regulations went into place. The problem is nobody knows what they are, 

and so when you apply for a permit, you do not know what you 

want to change; and if you want to ask a question, then nobody in 

the Administration can answer the question. And, consequently, 

that is why we have had this tremendous decline in the permits. 

There is no moratorium. 

Lieutenant Governor Angelle has been up here quite a bit working on these issues directly with the Administration or the MMS, 

but still it has been—the recent one permit that came out, that was 

for Apache Corporation and for a natural gas well. The new guidelines and new rules are very, very vague, and so nobody can get 

the information out of the Administration. 

Senator THUNE. And do you know how many rigs have left or are 

leaving already the Gulf area? 

Mr. BRIGGS. I can say this, and from very good sources, you 

know, we know three have left, and two have gone to Congo, one 

to Angola. There are some contracts being negotiated for Brazil. 

But, you know, it is really a horrible thing to believe that it is politically safer to drill in Angola than it is here in the Gulf of Mexico. 

The other countries around the world are very happy about this, 

and the reason they are is simply that the demand for these type 

of drilling vessels are very high. There are not that many of them. 

And, consequently, they will take—some of these vessels will stay 

for a while, no question about it. But they are not fully manned, 

and so they are not operational. They are just sitting out there. 
87 

Senator THUNE. Have any of you looked at, had an opportunity 

yet—there is a piece of legislation that Senator Vitter and others 

are putting forward that would mandate that the moratorium not 

apply to rigs that have met new inspection safety requirements 

that are required by the Department of Interior, and additionally 

it requires Interior to make a decision on these permits within 30 

days of compliance. I am just wondering if anybody has had an opportunity to take a look at that legislation and whether or not that 

might be a better approach than what is being put forward by the 

Administration in the form of this moratorium. 

Mr. MASON. I have looked at that. That is a standard crisis approach policy that makes perfect sense, because we need to get the 

industry back running again. Think of it this way: What if in response to the financial crisis we would just say, ‘‘Let’s put a moratorium on all investment banking activity until we kind of figure 

it out, and we will form a committee’’ and that is where it stopped? 

Well, that is what we have today in the Gulf. We need to get these 

inspected, again, reward the safe operations, shut down the unsafe 

ones or remediate the unsafe ones and get the business operating 

again. 

Senator THUNE. Mr. Treese, would you be willing to provide the 

Committee with the same analysis that you provided in your testimony for the five Gulf States but on a nationwide basis? Is that 

possible to provide that analysis, the impact, the ripple effect, so 

to speak, that that would have? 

Mr. TREESE. Thanks for the question, Senator. I think we can— 

yes, we are happy to do additional analysis as requested. 

Senator THUNE. Okay. I see my time has expired. Thank you, 

Madam Chair. 

Chair LANDRIEU. Thank you. 

If you would, Dr. Mason, I was particularly intrigued with the 

middle paragraph on page 21 of your testimony, and I would like 

you just to either read it into the record or just summarize it. It 

starts, as you try to get to it, that your research says that the current moratorium in the Gulf Coast will lose more than 8,000 jobs, 

$500 million in wages. Can you just repeat that for the record? Because I think I might have cut you off before you got to that point. 

Mr. MASON. Indeed, my study that I released last week, again, 

just the minimum effects of the 6-month moratorium, assuming 

business comes back immediately when that moratorium expires, is 

reasonably expected, based on Government estimation methods, to 

be 8,000 jobs, about $500 million in wages, $2.1 billion in economic 

activity, and about $100 million in state and local tax revenue just 

for the Gulf states alone. 

Chair LANDRIEU. And that is assuming the best-case scenario, 

and we are not on a glide path to that right now, in my view. 

Continue to go on, on the spillover effect of that. 

Mr. MASON. The spillover effect to the entire nation would be a 

total cost of 12,000 jobs, about $3 billion in economic activity nationwide, another $200 million in Federal tax revenues. 

Chair LANDRIEU. And if it lasts longer, what did your analysis 

show? 

Mr. MASON. Well, I looked at a worst-case scenario where the 

rhetoric escalates to the point of kind of a precautionary principle 
88 

application throughout the Gulf of Mexico. We could very easily go 

to 25,000 jobs in the intermediate scenario. These loss estimates 

can double and triple very quickly. If we go up to really shutting 

down the entire Gulf, we get to about 420,000 jobs and about $95 

billion in economic activity. 

Chair LANDRIEU. Okay. Well, I would strongly suggest with numbers like this overlaying a fragile economic recovery that the Administration get very busy with its own economic analysis, because 

this must inform, in my view and in the view of Senator Vitter and 

many others, the decisions that move us forward. 

In addition, there is a question that this panel cannot answer, 

but my question would be: Who is going to pay the businesses that 

go out of business for this action? Who is going to reimburse the 

workers that have lost this job because of this Government action? 

And where will that money come from? 

We will hold the answer to that question to potentially our next 

panel. Thank you very much, and if the second panel would come 

forward, we appreciate it. For time purposes, I am going to start 

introducing you all now. 

Mrs. Charlotte Randolph has served as Lafourche Parish President since 2003. Mrs. Randolph represents a community greatly 

impacted by the Deepwater Horizon disaster and the current drilling moratorium. She is past editor of Lafourche Gazette and is here 

to represent many businesses in the Lafourche Parish and region. 

Leslie Bertucci is a lifelong resident of New Orleans. With her 

husband, Dan, she owns R and D Enterprises, a specialty oil field 

equipment company that leases tanks and racks used for offshore 

rigs, including she was servicing the Deepwater Horizon. Mrs. 

Bertucci has firsthand knowledge of the economic stress caused by 

this moratorium, not just on her family but on the 14 full-time employees that work for them. 

Troy Lillie is a former offshore platform worker. He spent 29 

years working in an Exxon refinery, is now in retirement. He does 

some freelance work for small businesses in which he writes safety 

training manuals for the industry. We look forward, Mr. Lillie, to 

your testimony today. 

And, finally, we have Kimberly Nastasi who is CEO of the Mississippi Gulf Coast Chamber of Commerce. She was former Executive Director of the Biloxi Chamber of Commerce, and we are 

pleased to have someone of that stature representing Mississippi 

with us today. 

Ms. Randolph, why don’t we start with you? 

STATEMENT OF CHARLOTTE A. RANDOLPH, PRESIDENT, 

LAFOURCHE PARISH, LOUISIANA 

Ms. RANDOLPH. Good morning, Madam Chair and members of 

the Committee. I very much appreciate the opportunity to testify 

today. 

On May 8th, oil first appeared on the shores of Lafourche Parish 

from the Deepwater Horizon blowout. We have now endured 70 

days of relentless effort to protect our valuable wetlands and our 

wildlife, and fishermen cannot make a living. 

Then came the moratorium on deepwater drilling, literally adding insult to injury. Nine of the top ten taxpayers in Lafourche Par-
89 

ish are located at Port Fourchon, which services all 33 rigs singled 

out in the moratorium. The spill has decimated the fishing industry. The moratorium will essentially end life as we know it in our 

parish. 

Up to 40 percent of our tax base could be lost by 2012 as a result 

of the drilling ban. At other hearings, testimony by rig owners indicates that they intend to leave the Gulf for other opportunities. 

Some employees have been offered transfers to other locations. 

Families are now making decisions as to whether the husband and 

father will live elsewhere, with the rest of the family staying behind to finish schooling. These are the lucky ones; the rest will be 

terminated. 

In April 2010, unemployment in the Lafourche Parish was 4.4 

percent, the lowest in the nation. By November 30th, the so-called 

end of the moratorium, the number of unemployed will increase 

dramatically. In his State of the Union address, the President said, 

‘‘Jobs will be our number one priority in 2010.’’ People in Lafourche 

Parish and those associated with the oil and gas industry and its 

support services are not expendable Americans. We fuel this country. 

Now, Madam Chair, I have letters from other companies from 

our area. One of them is a trucking business with 20 people. At the 

beginning of June, they looked at what was happening in the industry. They haul offshore oil equipment to Port Fourchon and 

other areas. According to this, they anticipate that by the end of 

that moratorium, 20 employees will have lost their jobs. 

A riser company in the Gulf is now employing 23 indirect and 89 

direct labor employees. In June, they anticipated reducing their 

workforce by 20 percent. If the moratorium continues, they anticipate losing 60 percent and losing $16 million in revenue. 

Another company, an insurance company, has 30 employees. 

They anticipate laying off 50 percent of their staff because most of 

their insurance coverage and risk management is tied to the oil 

and gas industry. 

A communications company has 116 employees. Naturally, this is 

an issue and an industry that depends on disposable income. But 

the continuance of the moratorium, there will be no disposable income. 

Finally, a Gulf towing company with two boats, they have 12 

highly trained and qualified personnel. They anticipate having to 

let those people go at the end of the 6 months, as well as potentially two shore personnel as well. Their annual payroll is about $6 

million. 

I had the opportunity to personally ask President Obama to reconsider his decision, but he declined. He did send out an economic 

team to assess the impact on our parish, and they are studying it 

now. 

We are very, very concerned about the fact that the shallowwater drilling, as Mr. Briggs mentioned earlier, is also impacted by 

this. 

Based upon the rationale behind the new moratorium, we are 

very concerned that Secretary Salazar is saying that there are no 

assets or very little assets to protect the Gulf Coast in the event 
90 

of another spill, and they are citing that as one reason for the moratorium. 

We are very concerned about the tanker traffic that is in the Gulf 

of Mexico right now. We have about 11,000 tankers that traverse 

the Gulf annually, about 3,000 a month—I am sorry, about 300 a 

month. And, quite frankly, the tankers have a four times greater 

chance of spilling into the Gulf of Mexico than an oil rig does. So 

we implore the Administration to consider that. 

Finally, I have a message from a woman whose husband left to 

go to work in the oil fields of China. He worked 33 years in the 

Gulf of Mexico, and his choice was either transfer to China or to 

actually lose his job. He chose China. She says her family is familiar with the sacrifice of sending him away from home to work, but 

this time it was very different. No longer does he have a short boat 

ride to reach his rig in the Gulf of Mexico. He now faces a complete 

day of flying across the world to China so that he can provide for 

his family. 

The Gulf of Mexico oil field can be a dangerous place to work, 

but that risk is one that my husband can train for in the many 

safety trainings he attends. This new journey risks: the risk of flying across the world, the risk of going to a country that does not 

have a strong democracy and liberties that we have here, the risk 

of working in an environment where the English language is not 

primary. Communication is paramount to have a safe work environment. Being so far away from home, my family loses the comfort that if an emergency takes place, my husband cannot just come 

home. His 86-year-old mother, who relies on Ed for everything she 

needs due to her age and a stroke, is unable to have the comfort 

of her son available to handle her health care decisions and basic 

needs. 

Our jobs are in jeopardy. Bring back our experienced workers to 

home soil with domestic jobs. I beg for the President and the Secretary to stop killing our economy and livelihoods. Repeal the moratorium so that we can earn a living. Bring my husband home. 

Thank you, Madam Chair. 

[The prepared statement of Ms. Randolph follows:] 
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Chair LANDRIEU. Thank you. 

Mrs. Bertucci. 

STATEMENT OF LESLIE BERTUCCI, OWNER, R AND D 

ENTERPRISES OF LA, LLC 

Mrs. BERTUCCI. Chair Landrieu, Senator Vitter, members of the 

Senate Committee on Small Business and Entrepreneurship, first 

I would like to personally thank you for giving me this opportunity 

to tell you a little bit about my experience as a small business 

owner in Louisiana. 

I was born and raised in New Orleans, and my husband and I 

have raised six children there. Together we own R and D Enterprises of Louisiana. 

We are a small family-owned and -operated business in New Orleans since 1983. At R and D we rent to the drilling companies 

very specialized tanks and racks that we designed and patented 

that are used specifically to safely transport and store drilling 

chemicals to only deepwater rigs. Our customers are the drilling 

companies. We employ 14 people, and these 14 people have families 

to take care of. Forty-two spouses and children, to be exact, rely 

on our 14 employees for their financial support. In addition, we 

have more than 40 vendors that we order supplies and services 

from every single month that rely on us and other companies like 

us for their sustenance. 

We are all very sickened by the loss of life and the ecological devastation that has taken place in the Gulf due to the BP Horizon 

explosion and subsequent oil spill, and we do not wish to minimize 

that. 

My company had equipment on the BP Horizon rig, and at the 

time of the explosion we also had equipment on 23 of the 33 rigs 

in the deep water in the Gulf. Much of my equipment is still out 

on those rigs. If these rigs are not allowed to drill, our equipment 

sits idle and produces no revenue. With no revenue, we will not be 

able to order from or pay our vendors. If we have no revenue, we 

will not be able to pay our business loans. If we have no revenue, 

we will have to lay off our employees, all of which were affected 

in some way or another by the devastation of Hurricane Katrina 

just a few years ago. One of my employees was actually unemployed for 2–1/2 years after Katrina, prior to working for us. 

Some of my employees’ spouses have already had their jobs affected by the moratorium. My office manager has three children. 

Her husband is a territory sales manager in southeastern Louisiana for a flooring manufacturer, and in the last 6 weeks alone, 

specifically because of the moratorium, his sales are 50 percent off. 

He reported yesterday that 10 percent of his customers have had 

to actually close their businesses in the last 2 months, and they attribute that directly to the moratorium on drilling in the Gulf, because of the other people who were affected and losing their jobs 

being unable to purchase flooring. So it is not just the people in the 

oil field that are affected. 

Since the ban on drilling in the Gulf, my husband and I have decreased our own personal salaries by 75 percent in one of my many 

efforts to slash our operating costs, in an effort to keep our employees on the payroll and off of the unemployment rolls. Unemploy-
98 

ment benefits are not a viable or desirable option for any of the 

hard-working people that I know in the Gulf Coast region. We do 

not want to file claims. We want to work. We want to be able to 

do our jobs, support our families, and support our local economies. 

We really want to remain self-sufficient. 

This blanket moratorium on drilling in the Gulf is not and will 

not resolve the damage that has already occurred to the families 

that lost their loved ones, our precious ecosystem, or our seafood 

industry. The moratorium simply adds insult to injury, and I personally think it is very irresponsible. The people of Louisiana and 

the Gulf Coast region need to know that the rest of our country 

does care about us and will be willing to consider the long-term effects that this moratorium is causing. The economic ripple effect is 

now and will continue to be catastrophic to our entire region. 

We do agree that that safety should be number one; however, we 

also know that banning all drilling in the Gulf does not solve that 

at all. 

On behalf of my company, my employees, the thousands of others 

companies and employees, and our entire community, we implore 

the Administration and Congress to please take into consideration 

the big picture and try to understand that this moratorium has already caused much more damage than good and it needs to be lifted as soon as possible. 

Thank you. 

[The prepared statement of Mrs. Bertucci follows:] 
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Chair LANDRIEU. Thank you, Mrs. Bertucci. 

Mr. Lillie, speak into your microphone and press your ‘‘Talk’’ button, please. 

Mr. LILLIE. Senator, if possible, I may have 30 seconds or so 

over. 

Chair LANDRIEU. Go ahead. 

STATEMENT OF TROY LILLIE, FORMER REFINERY EMPLOYEE, 

EXXONMOBIL 

Mr. LILLIE. Honorable Member of the U.S. Senate, thank you for 

allowing me to speak to you today about the deepwater drilling 

moratorium. I am Troy Lillie and my wife, Melanie, and I live in 

Maurice, Louisiana. For 29 years I worked in the ExxonMobil Refinery in Baton Rouge and since have worked part-time writing refinery manuals. Last summer, I was blessed to work with a great 

bunch of people on an offshore oil platform. I am a very concerned 

citizen about what this moratorium is doing to the lives of our Louisiana people. My daughter and her husband work for oil field companies in our area. As Mr. Briggs said, my son-in-law is being 

transferred overseas as soon as he can get a visa. My daughter 

must remain behind with their two young daughters. They are 

lucky. They still have jobs. Many of the Louisiana people are losing 

their jobs and fear the worst. There were 33 deepwater rigs operating in the Gulf with approximately 200 personnel onboard. And 

I believe you all have better information from the first panel, but 

this was my guesstimate, that 6,600 jobs would be lost immediately, and I think have, and probably for each one of those, ten 

more, so that is up to the 66,000 range. And God only knows how 

many small businesses will fail. 

We live in the oil field corridor from Lafayette to New Iberia, 

Morgan City, Houma, Grand Isle, and New Orleans that is the location for countless small businesses that support the offshore industry. They are a family, and word spreads fast of layoffs and failing businesses. One can already observe in the shops and malls 

that there are fewer people shopping. Smaller businesses are losing 

customers because people are scared of the uncertainty. If the 

deepwater rigs leave the Gulf, their fears will be realized, I promise you. The tens of thousands of jobs and many, many small businesses may be lost while we are told that we are creating. People 

in our area have a hard time believing the sincerity of job creation 

by the President. 

Having been in the oil industry for three decades, I can tell you 

without a doubt that the culture of the oil field puts safe operations 

first, offshore and onshore. 

The Horizon accident is truly a tragedy and the loss of the 11 

men onboard is something none of us want. All who work in the 

oil field know the dangers and accept them. It is no different than 

working as a fireman, a policeman, serving in the military, working 

in a coal mine, or any other occupation that has inherent dangers. 

We had a coal mine accident or two in the last year, and that did 

not justify a moratorium, so we wonder why does the Horizon accident justify a moratorium. 

Most in my state do not accept it is because of the possibility of 

another blowout. Using this excuse to do far more damage to Lou-
103 

isiana, the Gulf Coast, and the nation than the spill has done is 

motivated, we believe, more by politics than sound reasoning. Supertankers offload millions of barrels of crude oil offshore of Louisiana each day. Odds are probably better—and I think we have already heard that—that something will happen with one of these 

tankers than it would with a deepwater drilling rig on the magnitude that Horizon did. 

Also, why does the executive branch of Government ignore the 

two rulings of the judicial branch and continue to ruin our economy, our small businesses, and our way of life with this unwarranted and we believe now unlawful moratorium. It also goes 

against the spirit of the law. This should not and must not be a 

political game. Tens of thousands of hard-working American lives 

hang in the balance, the economy of Louisiana, and serious damage 

to the Nation in higher fuel prices and operating costs for businesses. 

This can be prevented today with the President lifting moratorium. Just as he recently apologized for a knee-jerk reaction in the 

story about the USDA employee, he needs to do the same thing in 

this moratorium. This was one life that was affected; this moratorium is tens of thousands of lives that are being affected. 

Louisiana has been through several disasters since 2005, including Hurricanes Katrina, Rita, Ike, and Gustav, the Stanford fraud 

costing thousands of retirees their life savings, and now the Deepwater Horizon accident. Louisiana will work hard and recover from 

the disasters, but many in my state now believe that we may have 

difficulty recovering from this moratorium and may not be able to. 

It is our prayers and our hopes that the President will do the right 

thing and lift this moratorium before it is too late. There is a 

phrase in Cajun French called ‘‘Joie de vivre,’’ which means joy of 

life. Lifting this moratorium can give us back its ‘‘Joie de vivre.’’ 

[The prepared statement of Mr. Lillie follows:] 
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Chair LANDRIEU. Thank you, Mr. Lillie. 

Ms. Nastasi from Biloxi, Mississippi. 

STATEMENT OF KIMBERLY NASTASI, CHIEF EXECUTIVE 

OFFICER, MISSISSIPPI GULF COAST CHAMBER OF COMMERCE 

Ms. NASTASI. Good morning, Chairwoman Landrieu, Senator 

Wicker, and the distinguished members of the Senate Committee 

on Small Business and Entrepreneurship. My name is Kimberly 

Nastasi, and I am the CEO of the Mississippi Gulf Coast Chamber 

of Commerce, and I would like to thank you for the opportunity to 

testify today on the economic damage that the deepwater drilling 

moratorium is causing to the region that my chamber represents. 

The Mississippi Gulf Coast Chamber of Commerce fosters leadership and the advancement of the community vision and interests 

of its members. Coast Chamber strives to improve the business climate through facilitating, advocating, and providing information on 

behalf of the region. Mississippi Gulf Coast Chamber of Commerce 

is a membership organization comprised of businesses in Harrison 

County and throughout South Mississippi. 

I am here today to speak against the drilling moratorium which 

suspended all current and pending deepwater drilling operations in 

the Gulf of Mexico, placing 33 oil rigs temporarily out of service. 

In a Bloomberg national poll released last week, 85 percent of 

Republican respondents, 73 percent of independents, and 65 percent of Democrats said they opposed the Administration’s drilling 

ban. It was reported that the wide-ranging moratorium is punishing an entire industry and region for BP’s catastrophe. 

People in Mississippi, especially along the Mississippi Gulf Coast, 

are resilient as proven by their recent experience and survival of 

Hurricane Katrina. Next month marks the 5-year anniversary of 

the worst natural disaster in American history. The Gulf Coast was 

devastated by Katrina and has attempted in the last 5 years to 

come back smarter and stronger. And then the recession began in 

the midst of the recovery. Isolated to an extent because of the widespread rebuilding, the Mississippi Gulf Coast saw the loss of numerous new projects and investors. 2011 was to be our year, a year 

that we expected to be back to pre-Katrina levels in jobs, tourismconnected industries, and our way of life was on the upswing— 

until April 21st, when the Deepwater Horizon oil rig explosion and 

consequently the oil spill occurred. To this day we still do not have 

a defined end; therefore, we truly do not know what to expect. 

Mayor Holloway of Biloxi said that we have been through everything—hurricanes, tropical storms, tornadoes, recessions, depressions, everything—and we have survived it all. But the common denominator in those events is that they had a beginning, a middle, 

and an end. 

In Louisiana and Mississippi, the oil industry and the seafood industry is a way of life and a part of our fiber, our very being. Our 

neighbors in Louisiana certainly have fared far worse, and our 

hearts go out to our friends and our neighbors. 

Mississippi too has been significantly impacted. According to the 

American Petroleum Institute, what happens in the oil and natural 

gas industry reverberates throughout the economy. That is because 

the industry is connected to a wide variety of industries that use 
108 

oil and natural gas products either directly or indirectly. About 23 

percent of businesses and 35 percent of employees in Mississippi 

are heavily affected by policies imposed on the oil and natural gas 

industry. 

According to Dun & Bradstreet’s preliminary Business Impact 

Analysis of Drilling Moratorium on Mississippi, a total of 379 Mississippi businesses and nearly 3,000 employees will be impacted 

negatively. And I agree with Senator Landrieu when she said this 

was ‘‘unnecessary, ill-conceived, and a second economic disaster for 

the Gulf Coast. The BP oil spill was the exception rather than the 

rule.’’ 

In mid-July Senator Wicker said that there is no doubt that the 

Federal Government needs to review thoroughly the Deepwater 

Horizon explosion so we can prevent a disaster like this from happening in the future, but this should not be done at the expense 

of the Gulf Coast economy. Now is the time to foster economic development in the Gulf rather than to stifle it with more bureaucratic red tape. The oil spill threatens the jobs and livelihoods of 

Mississippians. The Administration should not add to this threat 

with policies that send American jobs overseas. 

The U.S. Chamber of Commerce urged Congress to reject hastily 

prepared legislation ‘‘that would keep American energy resources 

offline and thus drive energy producers overseas, along with their 

infrastructure and expertise, and hundreds of thousands of wellpaying U.S. jobs.’’ And almost 3,000 of these are filled by Mississippians. 

The U.S. Chamber continued by adding that many of the legislative proposals under consideration could have serious consequences, such as increased dependence on foreign oil at higher 

costs in the short- and the long-term, growing energy security 

risks, and a less competitive and potentially crippled gulf coast 

economy. The impact of legislation could be severe considering that 

the oil and natural gas industry employs more than 9 million 

Americans, including 46,000 in our region. 

Once again I greatly appreciate the opportunity to testify today, 

and I look forward to addressing any questions that you have. 

[The prepared statement of Ms. Nastasi follows:] 
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Chair LANDRIEU. Thank you. I sincerely appreciate that, all of 

you, and for your very personal testimony and reflections on the 

current situation, which is extremely serious. 

We have been joined by Senator Wicker. We will go through just 

a few questions. I want to make a statement, though, before I go 

into my round of questions. 

I started this hearing knowing that this decision was heavyhanded and ill-conceived. But after listening to this testimony, I 

want to add just a few thoughts to that. 

This decision was made by this Administration in disregard to 

their own committee of professionals that they assembled to advise 

them as to a path forward. This decision was wrong-headed, it is 

irresponsible, and it is reckless. It has increased our risk to the environment. It has increased our national security risk. It has increased our risk for job security for thousands of hard-working 

Americans in my state, in Mississippi, in Texas and Alabama, and 

throughout the Gulf Coast. And it must be reversed now. 

We are going to continue to have hearing after hearing in this 

committee, if necessary, until this issue is brought squarely before 

the American public. This is unacceptable—unacceptable—on the 

part of the Federal Government. 

I want to state for the record again, from 1947 until 2009, there 

were 42,645 wells drilled in State and Federal water in the Gulf 

of Mexico. And 99 days ago, one of them blew up. Eleven men lost 

their lives. But an entire industry has virtually been shut down. 

My question to President Obama and to his Administration after 

they scrambled to put an economic analysis together that they 

should have put together before they made this decision is: Who is 

going to pick up the cost of this? And what taxes are you going to 

raise or what revenues are you going to put forward to do so? Because someone has to pay for the recklessness of this decision. 

Ms. Randolph, would you say again for the record that nine of 

the ten taxpayers in Lafourche Parish are located in Port 

Fourchon? This is because Port Fourchon is our small port, but it 

is the number one port that services the deep water. Could you just 

give another minute or so of testimony about how this moratorium 

is affecting the small businesses in Lafourche, not just the rather 

large or medium-size businesses that service the Gulf, although 

Mrs. Bertucci most certainly represents the small businesses with 

14 employees that we are—but something about what you are 

hearing as parish President in the last 30 days or 60 days in your 

parish from small business owners that work indirectly, how is this 

moratorium affecting them? And in your view, is it worse than the 

spill itself or about the same? 

Ms. RANDOLPH. First, Madam Chair, I would like to say ‘‘Amen’’ 

to your statement. I did not think applause was appropriate, but 

I thought I would say ‘‘Amen.’’ 

Secondly, in Lafourche Parish, the uncertainty of this is what is 

causing so much of the decrease in employment. It is causing people to fear spending money. They do not know what tomorrow is 

going to bring. People who have had jobs for many years, Momand-Pop businesses, men and women who have worked side by side 

now for 40 years are talking about either retiring or perhaps following their children to where they are elsewhere. 
115 

The uncertainty of this is what is causing everyone to fear any 

type of large spending. Mrs. Bertucci mentioned the tile company. 

I talked to our permits department, and our permits are down. People are not applying for loans to build houses. It is impacting every 

level in the parish right now just because of the uncertainty. 

Chair LANDRIEU. Now, I understand you met with the President 

personally about probably 3 or 4 weeks ago, as I recall, you had 

the opportunity to walk with him on the beaches of Grand Isle. 

When you brought this issue to him, did he give you any indication 

that he was going to try to make it clear in the near future if he 

supports oil and gas drilling going forward in the Gulf? Or did he 

make any definitive statement to you at the time or show any understanding of the situation as it affects the economy in your parish? 

Ms. RANDOLPH. The short answer is no. His response to my request was that the mood of the nation was such that he had to take 

this action. If I could expand on that, we just recently returned 

from the National Association of Counties’ annual conference which 

represents 77 percent of the counties in the United States. We put 

forth a resolution to ask the President to lift the moratorium in 30 

days. It passed the National Association of Counties. So the mood 

of the nation is such that they do not agree with this shutdown. 

It was a test, and it indicated to me and to all others there that 

it was not just Louisiana who is concerned about this. The entire 

nation is concerned about this impact to us. 

Chair LANDRIEU. Thank you. 

Mrs. Bertucci, let me just ask you, you talked at great length and 

beautifully about your own company. You talked about one of the 

companies associated with one of your workers, I think the flooring 

company. But I understand, as Mr. Lillie said, this really is a family; it is a very large family along the Gulf. Is there any one or two 

other short stories in a minute or less that you would like to share 

about any other companies that you know that are experiencing 

hardship or just any other comments you would like to add in closing? 

Mrs. BERTUCCI. Sure. I believe there are many, many companies 

that are experiencing hardships right now. There is one particular 

company in Harvey, Louisiana, that we purchase our industrial 

hoses from, for example, and this particular company also supplies 

the ice houses that supply the fishing industry. And it was very 

normal for me, my company, my little tiny company, to order 

$30,000 a month in industrial hoses from him. We have not been 

able to order any hoses from him since this has happened. I am not 

sure exactly how many other companies like myself have all of a 

sudden not been able to order anything from him. I know that he 

is struggling. Everyone I know is struggling. 

There is a very well-known restaurateur in New Orleans that 

owns multiple, very successful restaurants that I know for a fact 

just borrowed $3 million to open a restaurant in Lafayette, Louisiana, right before the moratorium and the spill happened. And I 

know for a fact that they are devastated and not knowing what is 

going to happen because Lafayette, as we all know, is also very 

much impacted. So it is a restaurateur. Everyone I know is impacted, and people are afraid to spend money. People are holding 
116 

onto money. People are not going out to eat. They are not spending 

money on anything that they do not absolutely have to, and that 

is affecting every other business in our area. 

Chair LANDRIEU. Mr. Lillie, let me ask you one question, and 

then I am going to turn it over to Senator Wicker, and then we are 

going to probably have to wrap up. You have spent 29 or 30 years 

in the safety aspect of this industry. Without going into the details 

of the Horizon, could you just give a minute or two to help Americans understand? I think some people might have an idea that despite the fact that we have drilled 42,000 wells and we have had 

one—we have had other accidents. I mean, I am not going to indicate we have not, and those are public and for the record. But this 

sort of extraordinary explosion we have not seen in quite some 

time. Even after major hurricanes come through, we have not seen 

this amount of oil released in our Gulf. 

In fact, just for the record, Mrs. Randolph was correct. Tankers 

have four times, according to the National Academy of Sciences— 

this is not from Exxon. This is not from Shell. This is not from BP. 

According to the National Academy of Sciences, tankers are accountable for 4 percent of all spills globally. Offshore drilling, prior 

to the Horizon, was 1 percent. Runoff and small spills from cars, 

boats, and other sources is 32 percent, which is the second highest 

percentage. And natural seepage itself is 63 percent. 

So with 1 percent of the risk, this action was taken, without economic data supporting it, without an understanding, in my view, 

of the extraordinarily damaging effects, and still to date, 60 days 

or so into this moratorium, we still do not have any clear answers 

or expectations as to why or when this could be changed. 

So, Mr. Lillie, what would you like to add to the record for a 

minute or so about your experience about how maybe safety has either improved or not improved on the rigs, in personal safety, in 

your length of experience? Because my understanding is—and if I 

am wrong, go ahead and correct me—that 20 years ago and 30 

years ago there were lots of things that were not done appropriately because we were just learning how to do this. I have been 

feeling more comfortable myself in the last 10 or 15 years. That is 

why this accident is so shocking to so many of us, because we observe that things are getting so much better and safer. Is that your 

view or is it just the whole industry gone run amuck? 

Mr. LILLIE. Let me say that my career was at Exxon refinery in 

Baton Rouge, and during my career, when I first started, safety 

was not as paramount to them as it is now. Now, within probably 

5 years after I went to work, safety is everything. You go in there, 

and they spend a large part of their budget on safety. And these 

folks are the same ones that have the offshore platform. 

Now, I can tell you firsthand that, you know, last year, last summer, I went out on an offshore platform working as a clerk for a 

while, and it is the same thing out there, maybe even more. Folks 

out there are so worried and so conscious of the environment and 

of safety that you just do not see people—I mean, you get beat up. 

When I was on the rig, we would start out—we would wake up at 

5:00; 6 o’clock we had a safety meeting of the—it happened to be 

a Shell rig, and the Shell folks and the construction folks that I 

was working for would have a safety meeting together with the su-
117 

pervisors. Then we would go up there, and every man on that platform that was working in the construction crew, we had a safety 

meeting. And I can promise you, the inspectors demand safety out 

there from the time I was out there. 

Now, I did not serve, you know, the majority—I was out there 

for a summer trying to make a living. But I can tell you the industry—because I worked in that refinery, and, I mean, it is just a culture now. Everything has to be done safely. That is paramount. 

And if you do not do that, you do not do it. 

Now, I cannot explain what happened with the Horizon. I would 

suspect that there will probably be findings that folks broke the 

rules. But, I mean, you cannot legislate breaking the rules. We can 

put all kinds of rules in effect, and if someone or some individual 

or some company chooses to break that rules, there is not much 

you can do about that other than what will be done, I am sure, 

with BP when this happens. But that is all I can say. 

Chair LANDRIEU. And that is the irony—and you are right. That 

is the irony of the situation, as I have said, and I going to turn it 

over to Senator Wicker for his line of questioning and then we will 

end. But the company that broke the rules, that obviously just did 

not follow some procedures—we have read a lot of the testimony 

in the press that has done a very good job of covering the fact the 

alarm system was turned off, the fact that there were not proper 

certifications of BP supervisors. The irony of this decision is that 

they are the only ones drilling right now in the Gulf. 

Mr. LILLIE. Exactly. 

Chair LANDRIEU. And everybody else who has a much better 

safety record, everybody else that had nothing to do with this, is 

sitting on the sidelines quickly going broke or contemplating bankruptcy in some cases. 

Senator Wicker. 

Senator WICKER. Thank you very much, and I appreciate the bipartisan spirit of this hearing today, and I certainly appreciate the 

words of the Chair of this Committee. Madam Chair, you are absolutely right. Runoff puts more oil pollution in our waters. Tankers 

put more oil pollution in our waters. Seepage is responsible for 

more. 

One company takes shortcuts, engages in what I believe will be 

proved to be gross negligence, and causes this one in 42,000 event, 

and if it is not enough that the residents of the Gulf states and the 

citizens of our nation have to experience the consequences of this 

explosion, the families, of course, the loss of life and the economic 

devastation that has been caused by this—if that is not enough, 

then here comes the Government, our own Government that we 

pay taxes to that is supposed to be encouraging job creation, and 

in defiance of their own panel, in defiance of two decisions by a 

Federal court, does an end run, in effect, around the considered 

opinions not only of a Federal district judge but also a Fifth Circuit 

Court of Appeals panel, and says we are just going to do it anyway, 

and we can do it by taking another run at it and changing our 

pleadings. And apparently they are able to get away with it. 

You know, back when I was a very young man, we had the Three 

Mile Island incident in Pennsylvania, and an overreaction to that 

cut off nuclear power development in the United States. It allowed 
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the rest of the world to get ahead of the United States in that regard, and we are just now coming back to the point where we could 

be realistic in the United States about joining France and other 

Western European countries in using nuclear power for part of our 

energy. It is the same overreaction by the Federal Government. 

And I would say to the Administration, listen to your own experts. 

Listen to the facts, as the Chair of this Committee has so 

articulately pronounced them today, and let us have our jobs back. 

It is very conceivable that this action by our own Government 

will turn out to have more economic devastation than the spill 

itself. Wouldn’t that be adding insult after insult after insult to injury for our own Government to take this action against the families, the workers, and the economy of our region? 

I appreciate all the panelists. I realize we had a panel before us 

that testified also. I particularly appreciate Ms. Nastasi coming on 

behalf of the Gulf Coast Chamber of Commerce today. This is really the third major hit that our economy has had in 5 years. Isn’t 

that a fact, Ms. Nastasi? 

Ms. NASTASI. Absolutely, and Katrina, which—as I stated, we 

were looking forward to being back this year. This was going to be 

our year, 2011. We really thought we would be in pre-Katrina jobs, 

the tourism-related industry, and then the recession hit and the oil 

spill hit. But the moratorium is man-made, and the moratorium, 

our industries are tourism, gaming, all small business-related, seafood industry, and oil and gas. So these industries were directly affected by Katrina, by the recession, and now when things are on 

the upswing, the oil spill and all of those—the tourism, the fishing, 

the recreation—are affected by it—the seafood industry. And the 

moratorium is so much more than the oil and gas industry because 

our neighbors in Louisiana frequently visit our area for tourism. 

And if they are not working, then that leads into another indirect 

industry that is impacted by the moratorium. 

So it is just the multiplier effect of who is being affected, and it 

is not just the coastline. Mississippi has nearly 400 businesses in 

the states, over 3,000 employees that will be affected, and the majority are small businesses. 

Senator WICKER. You are right; it is not just the coastline. I 

would have to say to small businesses in Mississippi—and it is true 

all throughout the Gulf—the resilience shown after Katrina by the 

local folks, not necessarily the politicians but the local people and 

local governments stepping forward, is just amazing. It is a wonderful testimony in determination and resilience and recovery. 

Senator Landrieu and I were candidates for election in 2008, in 

September, when that economic crisis hit, and it seemed like the 

stock market was coming down, and everybody was losing their 

pensions. And I was getting myself acquainted politically on the 

coast there as a statewide candidate for the first time, and we had 

to face that devastation and try to wrestle with what the real 

causes were. And hopefully we have gotten the right answers—I 

am not so sure about that—in terms of our response. 

And then here comes this disaster, and you are right. It is not 

just the Gulf Coast counties; it is not just the Gulf Coast states. 

It is everybody. It is Americans from Maine and South Dakota; we 

all rely on this energy. 
119 

Let me ask you this: I was on a panel the other day where a representative from another state talked about how they have more 

tourism than we might have in Louisiana and Mississippi, more 

beaches in some states than in Mississippi and Louisiana. Talk to 

us, if you will, any of you, about how we co-exist. Tourism is a 

major industry in the three Gulf Coast counties of Mississippi. Is 

that correct, Ms. Nastasi. 

Ms. NASTASI. That is absolutely correct. 

Senator WICKER. And also the seafood industry, and also the oil 

and gas and petroleum industry, and I think it would be fair to say 

that people of the Gulf Coast are among the most environmentally 

sensitive and aware of anybody in the United States of America. 

Would you say that is a good characterization? 

Ms. NASTASI. I would agree. 

Senator WICKER. We have to co-exist with all of those, don’t we? 

Ms. NASTASI. We do. 

Senator WICKER. Would anybody else like to comment about 

that? 

Chair LANDRIEU. Senator, I would, if I could. 

Senator WICKER. Yes. 

Chair LANDRIEU. I would, if I could, while they are thinking 

about that, because you brought up an excellent point, and this 

record would be incomplete without it, and it is an extremely important point. This Gulf Coast that we are proud to represent is 

home to many industries that use this water and have used it safely and carefully and respectfully for many years. 

This action sends such a wrong message to places in the world. 

The message is: We are not sure if you can fish in the same waters 

that you can drill oil and gas. We are not sure that you can operate 

your boats safely and your fishing trawlers. We are not sure if your 

oystermen and your crabbers—and so we are just—the greatest 

country on Earth is saying to the rest of the world, ‘‘We are not 

sure.’’ 

It is a really troubling message, and I want to say as a Senator, 

the senior Senator from my state, and one of the senior members 

from the Gulf Coast, this is a point of extreme pride to our region. 

We are proud. We make no apologies. And we believe that we can 

have a vibrant tourism industry. We believe and know we can have 

a vibrant manufacturing and fabrication industry. We believe we 

can have high-tech science and engineering jobs on our coast. We 

believe we can have some of the finest restaurants in the world. 

And we believe that we can have an extraordinary quality of life— 

not maybe represented by the per capita income, but not everything great in the world is actually measured by wealth. Let me 

say that to the people of Washington, D.C. And all of this has been 

put in jeopardy. 

So if anyone wants to answer that question, then we are going 

to have to wrap up this hearing. 

Ms. RANDOLPH. Real quickly, Senator, you know as well as we 

do how much money the oil and gas industry contributes to the national treasury. Just off our coast is $6 billion a year. We are significant. And in order for any other industry to operate, they need 

oil and gas. And that has to be an accepted fact, and it has to be 

something that we react to now and that we lift this moratorium 
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and say let us resume tourism, let us resume fishing, let us resume 

everything else. But we can only do that if we lift this moratorium. 

Thank you, Senator. 

Chair LANDRIEU. Mrs. Bertucci. 

Mrs. BERTUCCI. What comes to my mind right now is I feel like 

our Government and our Administration, the job should be to protect and to serve the people. And in this particular instance, I do 

not feel like we are being protected or served at all. I feel like we 

are being devastated, and I think that is the opposite effect of what 

should be happening. And there is no real rationale for it. It does 

not accomplish anything positive for anyone or any industry. It just 

simply exacerbates the devastation. 

Chair LANDRIEU. Mr. Lillie. 

Mr. LILLIE. Yes, Senator, just to reinforce what you said, I believe the people in this area and along the Gulf Coast have known 

for years and decades that our great steel reef—barrier, reef, whatever—offshore, the oil rigs themselves are one of the reasons that 

we have such a fine fishing industry and such a fine—a lot of divers. It is a mecca for scuba divers, and that brings in a lot of tourism, a lot of sport fishing. And you cannot go to a single rig that 

there are not boats out there fishing. And I can tell you from working on the platform, you cannot go to Sea World and see as good 

a show as you can see by looking down through the grate of that 

rig. 

Chair LANDRIEU. It is quite amazing, the sight. 

Mr. LILLIE. It is unbelievable, and, yes, it does co-exist very well. 

It fits very well together. Thank you. 

Chair LANDRIEU. If it is managed appropriately. 

Ms. Nastasi. 

Ms. NASTASI. I would just once again like to thank you for allowing me this opportunity to represent my region and Mississippi 

specifically. I do think that all of the industries on the Gulf Coast 

are very interconnected, and they are impacting each other. And 

right now because of the moratorium, we are crippled with fear, 

and that is paralyzing the Gulf Coast. And I appreciate you listening to our testimony today and certainly hope that the outcome will 

be beneficial for our areas. 

Senator WICKER. Madam Chair, I do not know of a single visitor 

to Sea World that does not want to fill up their car with gasoline 

and have their home air-conditioned and heated, and all of that 

takes energy. We are talking about jobs for Americans today. We 

are talking about energy for the entire country of the United States 

of America, not just for one region. 

Thank you. Thank you for this hearing. 

Chair LANDRIEU. Thank you. Thank you, Senator, and we are 

talking about trying to use our intellect and our rationale to move 

forward, and that should be paramount. And it is absent, in my 

view. 

I want to submit to the record two letters—one that I wrote to 

Dr. Romer, and she has assured me that she will be here and 

someone else is—well, she assured me she will be here in September for the next hearing that we are going to hold, and that letter will be entered into the record. 

[The letter follows:] 
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Chair LANDRIEU. And this is a letter I sent to President Obama 

on July 26th, and that should be reflected in the record. 

[The letter follows:] 
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Chair LANDRIEU. I would also, Ms. Randolph, like to ask you to 

submit for the Congressional Record the resolution from the National Association of Counties. 

[The resolution follows:] 
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Chair LANDRIEU. And if any of you have accessed any other official resolutions from your specific areas, if you would submit that 

for the record. And we are going to build this record. It will be open 

for 2 weeks, the record of this Committee. But I can say in conclusion I intend to hold hearing after hearing about the effects of 

small businesses affected along the gulf coast and the Nation until 

this moratorium is lifted. 

Thank you. The meeting is adjourned. 

[Whereupon, at 11:58 a.m., the Committee was adjourned.] 
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Æ