Jeremy Alford

Capitol Correspondent

BATON ROUGE — An oyster ban that has kept new commercial farmers from securing waterbottoms for more than seven years could be partially lifted soon and completely dismantled over time, officials say.

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But legislative hurdles and disagreements among special interests need to be addressed first.

That’s why the Louisiana Wildlife and Fisheries Commission created a special advisory committee that has met six times this year.

Initially, the committee imposed a deadline of Dec. 31 for a course of action, but that objective will not be met. But that shouldn’t be taken as an ominous sign, said Heather Warner-Finley, a habitat program manager for the state who is also overseeing the committee.

A number of controversial issues have been put to rest, she said, and a Jan. 11 meeting expected to be held in Houma will begin to put the finishing touches on what has become an eagerly awaited plan.

“We have about eight recommendations ready to go, some of which may require legislation,” said Warner-Finley. “With that done, we’re just now getting to the moratorium as an issue.”

By most accounts, it appears the ban could be completely lifted within three years. On the way to that goal, it’s expected that certain areas will slowly be opened up for harvesting again in the interim.

The moratorium was originally imposed in 2002 and applied to waterbottoms that were not leased at the time, meaning commercial harvesters with wetlands were able to keep and later renew them.

It came about due to liability questions for the state, private landowners and oil outfits, all of which were swamped by record-setting court judgments brought about by oyster farmers.

Last year, the state Legislature told the Wildlife and Fisheries Commission to create the committee to work on lifting the ban.

The resulting group includes special interests that are traditionally — and still — at opposite ends of the policy table when it comes to waterbottoms, like the Louisiana Oyster Task Force, Louisiana Landowner’s Association and Louisiana Oil and Gas Association.

Mike Voisin, CEO of Motivatit Seafoods, an oyster-processing company in Houma, represents the oyster task force on the advisory committee. He said he has found it “interesting” how well oyster farmers and oil executives are working together since they’re historically adversaries, and how far to go landowners and oyster farmers, more recent combatants, still have to go.

“If we stand united, we can get this done, but it’s a complicated issue,” Voisin said.

Determining who owns and has the rights to use the bottoms of various waterways is often difficult, he added.

This is how the next couple of years could potentially breakdown:

The first action could come as soon as the first quarter of 2010. That’s when all of the applicants that were pursing waterbottoms when the moratorium went into effect will have the opportunity to finally move forward with leases.

But that only accounts for a small portion of the existing moratorium. There are no estimates yet, since officials are still working with local governments to make sure no new coastal restoration projects are slated for the proposed waterbottoms.

Warner-Finley said this phase would likely require that a new class of leases be created. This would be done to ensure oyster farmers can’t seek damages from an oil company if there’s already a rig, pipeline or other existing mechanism on the waterbottom.

The second phase could potentially involve giving oyster farmers who lost leases during the 1990s and the beginning of this decade to government-sponsored coastal-restoration projects the opportunity to renew their leases if the project is completed.

The third phase might give oyster farmers with leases the opportunity to expand their investment by 500 feet on any side if they had previously lost portions of their leases to coastal activities.

Voisin said once these three phases are complete and the Legislature has adopted all of the required legislation, the next step would be to completely lift what remains of the moratorium.

By Don G. Briggs, President – LOGA (Louisiana Oil & Gas Association)

The Louisiana Department of Natural Resources (DNR) recently released a report, “Economic Analysis of Oyster Lease Dynamics in Louisiana”. The overall purpose of the report was to “estimate the speculative value of oyster leases in Louisiana and show how the magnitude of that speculative value compares to the value derived from harvesting activities.” DNR contracted Walter R. Keithly, Jr.,Ph.D. and Richard F. Kazmierczak, Jr., Ph. D. of LSU to conduct the study, both are Natural Resource Economists.

Keithly and Kazmierczak summarized their findings, “At its core, our analysis indicates that the speculative value of leases is likely equal to, or exceeds, lease value based on income generated from oyster production and harvesting activities.” The report showed that oyster leased acreage has grown from 75,000 acres in 1960 to 400,000 in 2004, while oyster harvest production fell from 100 lbs per acre average in 1960 to just under 20 lbs per acre average in 2004.

The oil and gas industry has claimed for years that some oyster farmers lease acreage for speculative purposes with no intent of harvesting oysters. An oyster lease acquired for the potential to generate income other than from non-harvesting of oysters is speculative leasing. For decades oil companies have paid millions to oyster lease holders, where there never has and never will be an oyster harvested. I must say at this point, the vast majority of Louisiana’s oyster industry is made up of good, solid, hard working businessmen; and in no way am I suggesting they are carrying out speculative leasing. There is not an industry in this country that doesn’t have some bad actors.

In recent years, Louisiana’s oyster industry and oil and gas industry have worked together finding common guidelines so both industries can co-exist in the same environment; thus resulting in the creation of the Oyster Lease Damage Evaluation Board. The Oyster Lease Damage Evaluation Board (OLDEB) was created to address conflicts between mineral owners and oyster leaseholders “to effect an equitable solution … which will result in fair and predictable treatment to the oil and gas industry while assuring the oyster fishermen actual compensation for damages to their oyster beds due to mineral activities”. As a result of the OLDEB being created, few cases have come before the board, with the oysterman and oil company arriving at a compromise.

The OLDEB has been successful in curbing outlandish claims, however, speculative leasing still exists with the oil industry paying for passage across leases where potential oyster growth is non-existent. Time is money to oil executives and most would rather write a check than litigate. It is time for the oyster industry and the Louisiana Department of Wildlife & Fisheries to explore for a reasonable solution to speculative leasing.