Four seemingly unrelated fragments of U.S. sports and politics came together this month, and none of them bore any connection to Penn State football.
- The 34th America’s Cup competition, in which very expensive, very fast, sailboats from around the world attempt to wrest the prestigious trophy from its current holder, U.S. software giant Oracle Corp., began trials Nov. 12 in San Diego.
- U.S. defense contractor General Dynamics has purchased three ships, built in Massachusetts to carry Liquid Natural gas, and licensed them in the Republic of the Marshall Islands – a cluster of tiny islets in the Pacific Ocean with a total land mass of about 70 square miles and a mean height above sea level of about seven feet.
- In western Pennsylvania, international petroleum giant and major NASCAR sponsor Sunoco is busy drilling mile and-a-half deep wells in Pennsylvania’s Marcellus Shale. One of the products bursting from the holes is ethane, valuable in plastic making processes performed by industries on the U.S. Gulf Coast. And …
- In 1920, Congress passed the Jones Act, intended to protect U.S Merchant Marine jobs by requiring that all goods carried by sea between U.S. ports be carried on U.S. flagged ships.
The four items were connected Nov. 3 and 4 in the U.S Congress. That was when the lawmakers approved legislation allowing support ships from a variety of nations to work with their respective America’s Cup teams in U.S. waters.
Buried at the bottom of the sailboat waiver was an almost invisible amendment, sponsored by Sen. Pat Toomey and Rep. Patrick Meehan, both Pa. Republicans, granting a Jones Act waiver to the three General Dynamics ships, allowing the vessels to carry ethane to the Gulf coast from a loading point Sunoco says it intends to build in Marcus Hook, Pa.
Toomey and Meehan had been trying to gain support for the Sunoco-General Dynamics waiver since early 2011, and with the America’s Cup legislation, Toomey found his chance; he threatened to delay floor action on the America’s Cup Act of 2011 unless the amendment for the foreign tankers was included.
Presumably, the ethane is only profitable to Sunoco and General Dynamics if it can be hauled on foreign ships. Toomey told his fellow senators if they did not grant the waiver, 25 future permanent facility operators would not be employed in Marcus Hook, Pa. Also, Sunoco would not spend $300 million to $400 million and hire 300-400 workers to build the loading facility.
The Senate passed S.1759 by unanimous consent on Nov. 3. The House passed its version of the waivers (H.3321) the following day in a 387-2 vote.
As of Friday, President Obama had not signed the law, but his signature seems likely; in San Diego, the Oracle team already has won the first match.
The legislation did not specify how Sunoco would transport the ethane from western Pennsylvania wells to the eastern Pa. seaport. Or what happens to the loading facility when ethane no longer is profitable, even with the availability of foreign carriers, to transport.
Sunoco already has a refinery in Marcus Hook it is trying to sell. Absent the sale, the company says it will shut it down. Why any company would want to buy an unprofitable refinery escapes logic, except to shut it down for the tax loss – like Larry the Cable Guy, setting fire to his pickup so he could collect the insurance to make the truck payment.
What the energy company would do with the ethane if it cannot be shipped through Marcus Hook on foreign ships remains unclear.
Also unclear is how many tax dollars will be required to “remediate” the “brown field” – political-speak for converting an abandoned industrial site to a more profitable use – when the gas finally runs out.
It’s troubling that a bill with such long-term economic and environmental ramifications would be buried at the tail of legislation enabling a nine-month sporting event.
It also is troubling that in all the debate about Marcellus-related jobs and riches, precious little discourse has been expended on what happens to the industrial infrastructure when the gas is gone.
Photo by Port of San Diego
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