Oil company fined $15 million for Jones Act violation

   Customs and Border Protection has fined Escopeta Oil and Gas $15 million for using a COSCO heavylift ship to transport an oil rig on the first leg of a move from the Gulf of Mexico to Alaska.
   The fine was based on the value of the rig.
   Jon Waldron, an attorney with Blank Rome that represents Escopeta, said the oil company is “considering its options including whether to appeal the fine to CBP.”
   Escopeta, which is using the rig to drill for natural gas in Cook Inlet, hired COSCO to transport the rig from Freeport to Alaska, but diverted the ship to Vancouver where it was outfitted for drilling. The rig was subsequently towed to Cook Inlet using U.S. flag tugs supplied by Foss.
   Though Escopeta had obtained a Jones Act waiver in 2006, which requires U.S.-flagged and built ships to be used for coastal movements of ships, the Department of Homeland Security ruled this year that the permit was no longer valid.
   Escopeta’s use of the Chinese ship set off a furor among U.S.-flag shipping interests. Escopeta said an appropriate vessel was not available, but U.S. companies said that U.S. heavylift barges could have been used for the job and that Escopeta had not engaged with them to discuss its needs.
   See: Controversial Alaskan rig move completed