US ready to review Jones Act waiver requests, White House says

Following a statement from the US Department of Transportation says it was evaluating resources to help mitigate potential impacts of the ongoing Colonial Pipeline cyberattack on East Coast gas and fuel supplies, including use of a limited temporary waiver of the Jones Act, the White House has said that it is ready to review Jones Act waiver requests.

The Department of Homeland Security has indicated that it’s ready to issue a waiver if needed, but said that at this point the need for such waivers was “not necessarily yet confirmed.”

The DoT said it has been monitoring reported fuel shortages along the US Atlantic coast and had started work “to enable consideration of a temporary and targeted waiver of the Jones Act”.

The Jones Act is a US federal law that requires goods (and fuel) shipped between two US ports to be transported on US built, owned, crewed and registered ships.

Any temporary waiver would permit fuel supplies to be moved on foreign ships along US coastlines, replacing the capacity lost while the Colonial pipelines from Texas to the north-east are out of action because of a cyber-attack.

The DoT said the Maritime Administration (MARAD) has initiated a survey of Jones Act-qualified vessels to begin the process of evaluating what assets are available in the Jones Act fleet to carry petroleum products within the Gulf, and from the Gulf up the Eastern Seaboard.

This would determine whether there was sufficient capacity on Jones Act-qualified vessels to carry the product and to determine if a waiver was warranted.

“The Maritime Administration’s role in the Jones Act waiver process is to determine the availability of Jones Act vessels to carry the products for which a waiver is sought. Authority to receive requests for and to approve waivers to the Jones Act belongs to the Department of Homeland Security,” the statement said.

Homeland Security Secretary Alejandro Mayorkas said on Tuesday May 11th that “we in the Department of Homeland Security began working immediately with the Department of Transportation to be ready should any request for a Jones Act waiver be made to us to allow a foreign flag vessel to deliver fuel should that need arise, and of course that need is not necessarily yet confirmed, but we want to be poised at the President’s direction to be ready and to be able to act immediately”.

Mike Roberts, President of the American Maritime Partnership, said that “the American Maritime industry has capacity available and the experience to transport refined products to help alleviate the distribution issues along the Colonial Pipeline, and is working with key energy stakeholders and policymakers to be part of the solution”.

The Federal Railroad Administration (FRA), which is also part of the DOT, has been asking rail operators to determine their capacity to help transport fuel.

The 5,500 mile Colonial Pipeline runs from Houston to New York ad is responsible for moving some 45% of refined petroleum products consumed on the eastern seaboard of the US. It has been shut since Friday May 7th.

Colonial Pipeline Co said on Monday it was working on re-starting the pipeline in phases with “the goal of substantially restoring operational service by the end of the week”. The company’s website was inaccessible for much of Tuesday due to apparent server issues.