Deepwater energy industry impacts on economic growth and public service provision in Lafourche Parish, Louisiana

• Published in: Socio-economic planning sciences 2008-09, Vol.42 (3), p.190-205
• Main Authors: Fannin, J. Matthew, Hughes, David W., Keithly, Walter R., Olatubi, Williams O., Guo, Jiemin
• Format: Article
• Language: English
• Subjects: Competitive advantage; Economic growth; Employment; Energy industry; Local communities; Louisiana; Productivity; Public services; Sea; U.S.A
• ISSN: 0038-0121; 1873-6041
• DOI: 10.1016/j.seps.2007.01.001

Oil and gas produced from active deepwater leases (over 1000 feet water depth) in the Gulf of Mexico as a percentage of total output increased from 27% in 1992 to 54% in 2005. This increase is requiring more land-based services. Port Fourchon's strategic location provides it with a competitive advantage as a supply base for a diverse set of deepwater oil and gas related activities, ranging from petroleum rig supply boats to the maintenance and repair of mobile drilling rigs. Further development of Port Fourchon as a supply base is expected to markedly impact Lafourche Parish. Community impact models (CIM) quantify the linkages among local economic activity and the demand for, and ability to support, local government services. A CIM developed for Louisiana, including an input–output module of the local economy, is used to evaluate the impact of the deepwater energy industry on the economy and government finances of Lafourche Parish. According to model results, the deepwater energy industry will continue to have a significant impact on that economy. By 2010, the industry was predicted to be directly and indirectly responsible for 2593 new jobs and $571 million in total output. Such activity should not strain the ability of local governments to deliver services.