Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Investing

Jones Act Loophole Allows Puerto Rico to Finally Access American Natural Gas

by March 26, 2025
March 26, 2025
Jones Act Loophole Allows Puerto Rico to Finally Access American Natural Gas

Colin Grabow

Since 2016, American liquified natural gas (LNG) has been exported to at least 40 countries. One place it hasn’t been sent, however, is Puerto Rico. Shipping the fuel in bulk from the US mainland to the Caribbean island has been rendered impossible due to the Jones Act, the 1920 law that restricts domestic waterborne transportation to vessels that are built and registered in the United States.

The problem for Puerto Rico (as well as New England, and possibly Alaska and Hawaii too) is that none of the world’s more than 600 LNG tankers comply with the protectionist shipping law. As a result, LNG cannot be transported by water from US export terminals to those parts of the US that consume natural gas.

Until now.

Last week, shipping firm Crowley announced that a French-built LNG tanker it recently purchased will begin supplying American natural gas to the US territory. Named American Energy, it is allowed to operate thanks to a Jones Act loophole that permits foreign-built tankers to transport LNG to Puerto Rico (sorry, New England) provided they are American-flagged, crewed, owned, and—this is a big one—constructed before the measure was passed in October 1996. 

After years of essentially being embargoed, the island can finally access American natural gas.

It’s about time—the de facto prohibition on purchasing US LNG has long been a costly headache for Puerto Rico. In 2019, the Puerto Rico Electric Power Authority’s (PREPA) CEO told Congress that the inability to source LNG from the US mainland meant hundreds of millions of dollars in lost savings (an amount later clarified at $300 million annually). This helps explain why Puerto Rico’s government in late 2018 requested a ten-year waiver of the Jones Act (ultimately denied) for LNG shipments.

With US LNG off-limits, Puerto Rico has been forced to obtain the fuel in recent years from more distant sources such as Spain, Oman, Norway, and Nigeria. 

Although some of that may now be in the rearview mirror with attendant cost savings, Puerto Rico’s Jones Act loophole isn’t exactly an optimal solution.

For starters, the steam-powered American Energy is old (by necessity, to comply with the loophole’s provisions). Built in 1994, the vessel is one of only 13 actively trading LNG tankers globally age 30 or older. Even significantly younger LNG tankers are being sold for scrap due to their lack of competitiveness. 

For added perspective, a 2013 Government Accountability Office report highlighted PREPA officials’ concern at the time about the efficiency and safety of using sixteen-year-old tankers. And now Puerto Rico must rely on a ship that turns 31 in August.

That American Energy is US-flagged will further reduce its benefit to Puerto Rico, as such ships are over four times costlier to operate than internationally flagged vessels. 

Puerto Rico deserves to be served by efficient, modern vessels instead of a costly one that, in more normal circumstances, would be a prime candidate for scrapping.

But let’s focus on the bright side. Crowley’s LNG tanker demonstrates the gains that can be realized when Americans are provided even a partial reprieve from the Jones Act. In this case, merely exempting LNG shipments from the law’s requirement that vessels be domestically built has enabled energy to flow from the US mainland to Puerto Rico and provided employment for US mariners. 

It’s a win-win.

Congress and the Trump administration should ponder what other efficient domestic supply chains can be unlocked when onerous maritime protectionism is pared back. 

0
FacebookTwitterGoogle +Pinterest
previous post
Naturalized Immigrants Probably Voted Republican in 2024
next post
⁠The Technology Ensuring Online Transactions Are Secure for Users

You may also like

Repealing Only Two Biden-Era Tax Credits Could Cement...

March 27, 2025

Canadian Court: Trudeau’s Use of Emergency Powers to...

January 24, 2024

Is Javier Milei a Libertarian?

August 15, 2023

Courts Decide Legal Questions About Foreign-Affairs Powers, Not...

February 6, 2024

Friday Feature: Oklahoma Parental Choice Tax Credit Program

June 9, 2023

New Book Excerpt: False Dawn, The New Deal...

April 21, 2025

Navigating the Future of International Taxation: A New...

February 13, 2024

Will the Precautionary FDA Slow‐​Walk Approval of a Promising...

May 31, 2023

The Chance of Being Killed by Foreign-born Terrorists...

August 22, 2023

As the Public Schooling Battle Map Passes 4,000...

April 5, 2024

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Trump’s Debanking Order Calls for Investigation, Something Tennessee Should Have Done

      August 10, 2025
    • Trump nominates State Department spokeswoman Tammy Bruce as UN deputy representative

      August 9, 2025
    • Kash Patel celebrates major FBI achievements and record seizures during Trump’s first 200 days in office

      August 9, 2025
    • The Ivy faces legal challenge from waiter over share of tips and service charges

      August 9, 2025
    • Smarter mining, more stable returns: RICH Miner launches convenient cloud mining app supporting XRP and BTC

      August 9, 2025
    • Sydney Sweeney jeans controversy making advertising great again

      August 9, 2025

    Categories

    • Business (8,730)
    • Investing (2,191)
    • Politics (16,349)
    • Stocks (3,228)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved