TRUMP’S CRACK­DOWN ON IL­LE­GAL WORK­ERS PUTS THE SKIDS UN­DER HIS OIL BOOM DREAMS

▶ Com­pa­nies want to play by the rules but the squeeze has left many jobs once taken by mi­grants un­filled

The National - News - - BUSINESS IN DEPTH -

New Mex­ico oil man Johnny Vega laid out his predica­ment as his crew hoisted pipes from a well dur­ing the big­gest oil boom in US his­tory.

The son of a Mex­i­can guest worker, Mr Vega can­not find enough le­gal work­ers to meet de­mand for his oil well ser­vice rigs. There is no short­age of His­panic and Latino im­mi­grant work­ers with­out work per­mits he could hire in Lea County, New Mex­ico – the sec­ond-big­gest oil-pro­duc­ing county in the United States.

But Mr Vega says he wants to play by the rules, not least be­cause of a height­ened risk of com­pany au­dits by US Im­mi­gra­tion and Cus­toms En­force­ment (ICE) un­der Pres­i­dent Don­ald Trump. As a re­sult, he has equip­ment that could be gen­er­at­ing $700,000 (Dh2.57 mil­lion) a month stand­ing idle in his yard.

“They’re de­mand­ing more rigs, more swab­bing units, but you don’t have enough em­ploy­ees,” says Mr Vega, who runs Mico Ser­vices, a com­pany with an­nual rev­enue of around $17 mil­lion. “It’s a lack of a sys­tem to get le­gal work­ers, to have more of a work­force to pull from.”

Em­ploy­ers such as Mr Vega in the Per­mian Basin oil­fields of New Mex­ico and Texas say they feel caught be­tween Mr Trump’s sup­port for their in­dus­try and his poli­cies fo­cused on tougher im­mi­gra­tion en­force­ment.

It’s a dilemma faced in other sec­tors of the US econ­omy that de­pend on for­eign work­ers af­ter ICE re­ported surges of be­tween 300 to 750 per cent in work­site in­ves­ti­ga­tions, au­dits and ar­rests in its 2018 fis­cal year.

Visas for tem­po­rary jobs in sec­tors such as agri­cul­ture and hos­pi­tal­ity have in­creased dur­ing the Trump ad­min­is­tra­tion. Oil com­pa­nies com­plain of dif­fi­cul­ties gain­ing work per­mits for im­mi­grant oil work­ers, who do not qual­ify for tem­po­rary visas.

The Per­mian Basin, by far the most pro­duc­tive oil­field in the US, has helped make the coun­try a net ex­porter of oil. Its out­put growth has re­cently slowed, but pro­duc­tion is still at all-time highs.

The num­ber of rigs drilling for oil in New Mex­ico hit a record 115 in early Oc­to­ber and labour short­ages are felt most keenly in ser­vice com­pa­nies such as Mr Vega’s that help keep the oil flow­ing.

The Per­mian Basin needs about 15,000 more work­ers, and is cur­rently meet­ing de­mand by pay­ing over­time and ship­ping work­ers in and out, ac­cord­ing to data from the Per­mian Strate­gic Part­ner­ship al­liance of 19 en­ergy com­pa­nies.

Thou­sands of im­mi­grants, mainly from neigh­bour­ing Mex­ico, have thronged to the decade-long boom. They of­ten fill the hard­est and most dan­ger­ous jobs few Amer­i­cans want, such as us­ing heavy equip­ment to lift oil well tub­ing or lay pipe­lines.

For Bob Reid, im­mi­grants pro­vide a so­lu­tion to labour short­ages and a chance for boom-bust oil towns such as Hobbs, New Mex­ico, to build a more sta­ble fu­ture.

“The prob­lem is a bro­ken sys­tem that is pre­vent­ing them from com­ing in legally in a way that al­lows them to pur­sue a path to cit­i­zen­ship,” says Mr Reid, head of the JF Mad­dox Foun­da­tion, a Hobbs char­ity.

In Lea County, His­pan­ics and Lati­nos now ac­count for as much as 70 per cent of the pop­u­la­tion, com­pared with 40 per cent 20 years ago, based on county school en­roll­ment and other data.

About two years ago, ICE stepped up op­er­a­tions in the Per­mian area, ac­cord­ing to Lea County em­ploy­ers.

“I know peo­ple, my peers, that have been hit by im­mi­gra­tion au­dits, and they were told, specif­i­cally, that the Per­mian Basin was tar­geted be­cause of the vast amount of work­ers that were com­ing here,” says Finn Smith, pres­i­dent of Wat­son Hop­per, a provider of oil rigs and other equip­ment in Hobbs.

ICE did not re­spond to re­quests for com­ment on its Per­mian op­er­a­tions.

Two com­pa­nies in Hobbs, the largest city in Lea County, were re­cently au­dited: Mesa Well Ser­vices and paving con­trac­tor Ramirez & Sons, ac­cord­ing to a source and a Ramirez & Sons of­fi­cial.

Mesa Well of­fi­cials were not avail­able for com­ment. Ramirez & Sons se­nior su­per­in­ten­dent David Gal­le­gos says the com­pany was pay­ing around $40,000 in le­gal fees to ap­ply for work per­mits or US cit­i­zen­ship on be­half of five of the em­ploy­ees laid off af­ter the au­dit. “They’re worth fight­ing for,” says Mr Gal­le­gos, a Re­pub­li­can New Mex­ico state rep­re­sen­ta­tive, of the long term em­ploy­ees who had bought homes in the area.

ICE op­er­a­tions, and Mr Trump’s threats of raids, have left many im­mi­grants in Lea County fear­ful. Some bolt from job sites at ru­mours of ICE ac­tiv­ity, said Maria Ro­mano of im­mi­grant rights group So­mos Un Pue­blo Unido in New Mex­ico.

More com­pa­nies are us­ing the gov­ern­ment’s E-Ver­ify im­mi­gra­tion back­ground checks to vet new hires, said Ms Ro­mano, whose or­gan­i­sa­tion helps im­mi­grants get on a path­way to cit­i­zen­ship.

“It’s now get­ting very dif­fi­cult here for any­one who isn’t doc­u­mented,” says Juan, an un­em­ployed pipe­line worker who en­tered the US il­le­gally 11 years ago and asked that his last name not be used to pro­tect his iden­tity.

About a third of all im­mi­grants in New Mex­ico and Texas lack valid work­ing pa­pers, ac­cord­ing to a Pew Re­search Cen­tre study based on 2016 US cen­sus data.

Hobbs Mayor Sam Cobb says he is frus­trated by the fail­ure of po­lit­i­cal lead­ers at a na­tional level to cre­ate a path­way to cit­i­zen­ship for im­mi­grants he gen­er­ally finds to be hard­work­ing and law abid­ing.

“The very peo­ple who have suf­fered from that are the peo­ple who are here grow­ing our com­mu­nity, adding to the eco­nomic wel­fare of the com­mu­nity,” says Mr Cobb, a Demo­crat, sit­ting in his of­fice sur­rounded by paint­ings of oil wells and cow­boys.

Yet plenty of em­ploy­ers in Lea County still hire un­doc­u­mented work­ers.

“What we do is we don’t ask,” says Lorena, a Mex­i­can im­mi­grant whose fam­ily has built up a small oil­field ser­vices busi­ness. She es­ti­mates that more than 90 per cent of her em­ploy­ees were Mex­i­can im­mi­grants and that only 5 to 10 per cent had gen­uine work­ing pa­pers. Her last name is not used to pro­tect her iden­tity.

Mr Vega’s labour woes are push­ing him to re­ori­ent his oil well ser­vice busi­ness to­wards hir­ing out his equip­ment.

“We have to rely on some of these im­mi­grants, in this neck of the woods, to pro­duce the work­force that we’re need­ing,” said Mr Vega, who says he sup­ports Mr Trump “100 per cent” but wishes he would “tone down” his rhetoric against im­mi­grants. “Why not al­low them to be doc­u­mented?”

Reuters

A swab­bing rig in a field in Semi­nole, Texas. US Oil com­pa­nies need more em­ploy­ees to op­er­ate these units

Bloomberg

The Per­mian Basin, in Texas, is by far the most pro­duc­tive oil­field in the US

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