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Despite BP oil spill, Louisiana still loves Big Oil

Deepwater drilling and Louisiana are synonymous. Despite the BP oil spill, the industry is still seen as delivering lifeblood.

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For a relatively poor Deep South state, plentiful stores of oil and natural gas have become a crucial source of wealth.

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"An upwardly mobile career path often leads people in Louisiana to the oil and gas industry," says Kirby Goidel, director of Louisiana State University's Public Policy Research Lab in Baton Rouge. "The state lags behind in higher education, and you can go make a good living on the rigs without going to college."

A major source of jobs

The oil industry employs about 58,000 Louisiana residents and has created another 260,000 oil-related jobs, accounting for about 17 percent of all Louisiana jobs. The average annual oil-industry salary is $95,000 – a very good income in Louisiana.

Moreover, in 2008, oil and gas made up 6.5 percent of Louisiana's revenue, more than five times the national average. As a result, Louisiana and offshore drilling have become synonymous.

"One third of the oil produced in this country comes from offshore, and 80 percent of offshore production comes from deep water off Louisiana," says Eric Smith, associate director of Tulane University's Energy Institute.

Indeed, 40 deepwater platforms operate in depths comparable to that of the Deepwater Horizon rig, producing petroleum from more than 400 wells off Louisiana, according to Mr. Smith. "Deepwater is ... the most productive area of oil production and that's where the big companies are working," he says.

This all plays into Louisiana's response to what some scientists suggest is already the biggest oil spill in American history.

To be sure, the state of Louisiana and its parishes are not doing nothing. A state Senate panel on May 18 endorsed a bill that would make it easier for the state to sue BP. And on May 17, the Terrebonne Parish district attorney filed suit against BP, seeking unspecified damages for wildlife killed or injured by the oil leak. The suit is the first filed on behalf of the state over the oil spill and is expected to be followed by similar claims from other coastal parishes.

Statewide, there are signs of growing anxiety and anger as the first heavy oil slicks to make landfall washed into Plaquemines Parish May 19. Images of oil-soaked wetlands coincided with news that the federal government was doubling the area of Gulf waters where fishing is banned due to the spill.

Many families in south Louisiana work in both the fishing and oil and gas industries, and marine scientists say the spill could severely damage the state's $1.8 billion annual fishing industry for years to come.